Market overview: CRH leads on Eurozone optimism



LONDON (ShareCast) - 1630:Close Stocks finished moderately higher on Wednesday despite news that the US fiscal cliff stalemate may have further to play-out. That as Republicans apparently have yet to make any new concessions following the White House´s own. Banks led gains throughout the better part of the day on the top share index following a positive broker note out from analysts at Credit Suisse (NYSE: CRP - news) . The best performer however was CRH (NYSE: CRH - news) . Deutsche Bank (Xetra: 514000 - news) today raised its shares to buy from neutral. On improved expectations for its operations Stateside? Not at all, the German broker believes the company will benefit from a gradual decrease in sovereign risks in the Eurozone; that has been a recurring theme amongst equity strategists of late.

Bunzl (LSE: BNZL.L - news) was the worst performer on the Footsie (FTSE: ^FTSE - news) after Caroline de La Soujeole downgraded the company´s shares to reduce from hold. This is what she had to say: "The shares are highly rated in our view, trading on a 1 year prospective price-to-earnings (P/E) multiple of 15.5 times. Estimated fiscal year 2012 P/E falling to 14.3 times, compared with a 5 year through the cycle average of 13 times. We move from HOLD to REDUCE (Hold since October 25th 2011) with a 980p target price based on an estimated fiscal year 2013 target P/E of 13 times." FTSE 100 up 26 to 5,962.

1513: Shares of Vodafone (LSE: VOD.L - news) are now perched atop technical support in the 155p area, such that not losing that area may merit watching closely. To be had in account for Vodafobe perhaps, the risk of any drift higher in long-term yields on Gilts, given the stock´s negative correlation to the same. Shares of the LSE on the other hand are having a go today at technical resistance in the 1,107p area, having earlier touched a 52 week high at 1,120p. IAG is also doing well in afternoon trading, having earlier announced the opening of routes to China.

1511: Impala Platinum (Other OTC: IMPUY - news) said its Zimbabwean joint venture with Aquarius Platinum, Mimosa, had concluded an agreement to transfer 51 per cent of its stake as part of an empowerment deal to black Zimbabwean groups, South Africa´s Times reports.

1508: There are reports taht BAE Systems (LSE: BA.L - news) could announce a contract win with Oman, for Eurofighter Typhoons, on the next 21st of December.

1500: "Rio Tinto (Xetra: 855018 - news) merits an update following its latest strong price action. When I last mentioned the stock it was breaking out above resistance in the region of 3300p and its winning run now extends to 14 sessions, during which it has surged by an astonishing 21%. Investors are clearly taking the view that the company will benefit from rising metals prices in 2013 and this new-found optimism is broad-based - yesterday's 98p advance was driven by a significant rise in volumes. The only real question mark over the rally at this stage is that it has left Rio Tinto looking extremely overbought - its 14-day RSI has charged up to a reading of 82% - a five year high," write technical analysts at Charles Stanley (LSE: CAY.L - news) . FTSE 100 up 38 to 5,974.

1442: Analysts at UBS (Berlin: UBRA.BE - news) have waxed optimistic on the outlook for Aviva (LSE: AV.L - news) today. This is what they had to say: "Although Admiral and Direct Line (BUY) offer commensurate exposure to tort reform upside, Direct Line's lower valuation and restructuring story mean it remains our preferred UK motor play. Aviva (BUY) looks cheaper still, and also offers the catalyst of a de-risking overseen by a new CEO with impressive pedigree." The rise in shares of RBS (LSE: RBS.L - news) are also being attributed by some to an upgrade from UBS.

1330: US housing starts for the month of November (Xetra: A0Z24E - news) have come in at an annualised rate of 861,000 (Consensus: 872,000). Housing permits on the other hand rose to 899,000 (Consensus: 875,000).

1156: Goldman Sachs (NYSE: GS-PB - news) sees yields on 10 year Gilts reaching 2.25 per cent by year end 2013.

1155: Analysts at Credit Suisse have today decided to move up to overweight on European financials (including insurers). They have also included Rio Tinto amongst their core picks for the year in the Metals&Mining space.

1110: The London Stock Exchange has reportedly lowered its offer for LCH Clearnet by 30 per cent.

1100: The total sales balance for the Confederation of British Industry´s distributive trades survey for the month of December has come in at 19 points, below the reading of 25 expected by the consensus and the previous month´s reading of 33. FTSE 100 up 35 to 5,971.

0930: According to the minutes of the last rate-setting meeting of the Bank of England the Monetary Policy Committee (MPC (KOSDAQ: 050540.KQ - news) ) voted by a margin of 8-1 in favour of maintaining the size of its asset purchase facility unchanged. The decision to keep the main policy rate at 0.5 per cent was unanimous. The results of both decisions were as expected.

0900: The IFO Institute´s German business confidence index for the month of December has come in at 102.4, rising for a second month and coming in ahead of expectations for a reading of 102 (Previous: 101.4).

0825: UK stocks have begun the day trading slightly in the blue, dragged higher by gains on Wall Street overnight. RBS, Lloyds and Barclays (LSE: BARC.L - news) are at the top of the leader board this morning. Bunzl on the other hand is the worst performer Bunzl despite saying that trading has been in line with the expectations. All of the above comes ahead of the release of the minutes of the last Monetary Policy Committee (MPC) meeting at 09:30. Some analysts say they will be watching for any hint that the latest macroeconomic data may have unnerved some of the Bank´s policymakers. They may not be the only ones.

Also on the 'macro' front, the FT details on how the UK plans to amend the 90 day consultation period required by firms to make large-scale redundancies, down to 45 days from April (Paris: FR0004037125 - news) . The risks that could arise if the United Kingdom chose to leave the European Union have also caught the attention of some observers according to some media reports. At 11:00 the CBI distributive trades survey is released. Barclays Research expects the total sales balance to have eased to 25 points from 33 in the previous month. Last, but not least, it would seem the ratings agencies axe can actually move in both directions and rather quickly at that. Greece has had its rating lifted by S&P to B- from selective default as it cites the 'strong determination' of local governments to maintain the nation within the euro. FTSE 100 up 15 to 5,951.