London open: Markets rebound after US jobs-related sell-off

8th Apr 2013 08:27

Despite renewed political uncertainty in the Eurozone this weekend, stocks in London started Monday's session broadly higher, rebounding after a heavy sell-off on Friday following a disappointing US employment report.American non-farm payrolls increased by just 88,000 in March, the lowest rise in nine months, according to the Labor Department last week. With the figure coming in well below the 190,000 consensus estimate, the FTSE 100 lost around 1.5% of its value on Friday."Despite this the US economy still remains one of the few economies where the economic data is still posting numbers well above Europe and the UK, and once all the hue and cry has subsided the markets could well reflect that, starting with a higher European open this morning," said Senior Market Analyst Michael Hewson from CMC Markets. "It does though beg the question as to whether US markets are too high relative to valuations as well as future earnings estimates, and prospective US GDP targets for 2013. We should get a better indication of company optimism on this point as US earnings season starts this week with Alcoa the first to report later this evening."However, Hewson said what is certain is that the lacklustre jobs report will delay the idea of scaling back stimulus measures Stateside into the latter part of the year at the earliest.Focus turns to PortugalJust as markets have begun to digest the Cyprus bailout last month, eyes are now turning to Portugal where the government's austerity programme received a severe blow this weekend after the Constitutional Court ruled against proposed budget measures, which include cuts to extra summer payments in pensions and public wages.After the court rejection, Prime Minister Pedro Passos Coelho promised to adjust for the measures blocked by reducing spending on healthcare, education, social security and state-run companies. The vetoed measures mean Portugal need to come up with €1.3bn in new cuts. Analyst Antonio Garcia Pascual from Barclays Research said this morning: "While an unfavourable ruling had been expected due to the Court's track record in 2012, it was the broad range of measures overturned that has created an unexpectedly large hole in 2013 fiscal budget."He said that the recent fiscal blow is likely to delay Portugal regaining full market access in 2013, and negative growth, rising unemployment and delayed fiscal target could push the country to request further aid in 2014.Polymetal keeps a lid on costs in 2012Precious metals giant Polymetal was a high riser early on after managing to hold back on costs in 2012 despite a strong rise in production. The company also raised its payout ratio to shareholders last year as it reported a 47% jump in adjusted EBITDA.Premier Oil was also making gains after saying that an exploration well on the Luno II prospect in PL 359 (30% owned) had found a "potential significant discovery".Travel stocks were rebounding this morning after their heavy falls on Friday when reports of a new bird-flu virus in China hit share prices across the sector. TUI Travel, easyJet and IAG were among the better performers today.FTSE 100 - RisersEurasian Natural Resources Corp. (ENRC) 258.80p +6.46%Polymetal International (POLY) 870.00p +3.82%Aggreko (AGK) 1,791.00p +3.59%ARM Holdings (ARM) 905.00p +3.08%Antofagasta (ANTO) 989.00p +2.91%TUI Travel (TT.) 307.00p +2.81%ITV (ITV) 124.10p +2.56%Weir Group (WEIR) 2,236.00p +2.38%WPP (WPP) 1,048.00p +2.34%Rexam (REX) 525.00p +1.94%FTSE 100 - FallersMarks & Spencer Group (MKS) 374.20p -0.69%Capita (CPI) 870.00p -0.63%Kingfisher (KGF) 288.00p -0.21%Centrica (CNA) 373.30p -0.21%Standard Chartered (STAN) 1,661.50p -0.15%Vodafone Group (VOD) 182.45p -0.08%BAE Systems (BA.) 386.20p -0.03%FTSE 250 - RisersAfren (AFR) 134.80p +5.89%Premier Oil (PMO) 381.00p +5.02%Thomas Cook Group (TCG) 111.00p +4.91%Kazakhmys (KAZ) 381.00p +4.44%Petra Diamonds Ltd.(DI) (PDL) 117.60p +4.07%Supergroup (SGP) 662.00p +3.92%Redrow (RDW) 187.50p +3.59%Cairn Energy (CNE) 282.70p +3.55%Barratt Developments (BDEV) 273.30p +3.41%Taylor Wimpey (TW.) 88.80p +3.32%FTSE 250 - FallersSpirent Communications (SPT) 134.10p -5.03%NMC Health (NMC) 316.62p -3.38%SDL (SDL) 397.70p -1.56%Greggs (GRG) 468.10p -1.39%Savills (SVS) 526.98p -1.04%PayPoint (PAY) 881.00p -1.01%New World Resources A Shares (NWR) 214.00p -0.93%Dignity (DTY) 1,391.00p -0.86%Anite (AIE) 119.40p -0.75%Ted Baker (TED) 1,271.00p -0.70%BC