Save from as low as €40 per month
Change modify pause
Markets are called higher this morning. This is what's happening today:
Markets are called higher this morning in Europe however we have withnessed a fierce sell off in the markets yesterday after we got to know that Spain's regions are now asking for bailout money and the probability of Greece leaving the Eurozone is now realistic.
As if the markets didn't have enough bad news to deal with, Moody’s Investors Service said it cut Germany, the Netherlands’ and Luxembourg’s Aaa credit rating outlooks to negative, citing “rising uncertainty” about Europe’s debt crisis.
A report released from China showed its PMI in July grew at its fastest in nine months, helping lift the HSBC Flash PMI to a five-month peak. The flash PMI is the first indicator that China's economy may show some improvement in the third quarter of this year. Still this is the ninth straight month that the figure has been in the contraction zone.
Apple report results today after the closing bell. Deutsche Bank came up with the following a few days before the results: AAPL: We expect Apple to post in-line to slightly below consensus revenues and an EPS beat supported by commodity led GM upside (Street at $37.4B and $10.34; DB at $37.7B and $10.15). We believe iPhone units could be 1-2m units light (DB at 30M) due to a demand pause in front of the iPhone 5 product transition later this year. We also expect in-line iPad (DB at 15M) and Mac (DB at 4.4M). Rev guidance is likely to be very conservative due to the combination of weaker Euro demand and the iPhone product transition. We expect consensus estimates to trend down on materially lower September Q iPhone units as Apple clears inventory in front of the iPhone 5 launch (we expect Oct).
Stock to watch: Inchcape, Price 360.4p, DB Price Target 480p
INCH sits on a low valuation because the market views it as hyper-cyclical like auto manufacturers. We believe it is better quality than this: its distributor-led model has more stable margins, higher ROCE's and better profit growth than autos and many of the UK General retailers. Newsflow is healthy with INCH's new car markets up 4.4% YTD v. INCH's 1.5% forecast, and INCH Australia benefiting from a likely 20% sales rebound after the 2011 tsunami-delayed deliveries. INCH has £200m cash, some of which may be returned to shareholders. EPS CAGR '11-14 of 10% & a 3.3% dividend yield should deliver a good return – even better would be a re-rating to 11x PE, giving 30% upside.
For further information on Inchcape or other stocks and bonds we follow, contact our offices on 25688688.
Good day and happy trading!
You are signing up to receive news, updates, general market announcement, articles and product or service marketing. By signing up you are consenting