Newspaper article The Evening Standard (London, England)

Footsie Extends Its Gains as Morgan Turns Bullish

Newspaper article The Evening Standard (London, England)

Footsie Extends Its Gains as Morgan Turns Bullish

Article excerpt

Byline: MICKEY CLARK

THE London stock market was shaping up for its sixth consecutive day of gains as one of the City's big-hitters turned bullish after being almost 18 months out in the cold.

As Americans voters were due at the polls and with the prospect of cheaper money on the way this week in the UK, Morgan Stanley has turned from seller to buyer of European stock markets.

It has moved from a "full house sell signal" in June 2007 to a "full house buy signal" as of 31 October 2008. It says: "We have now come full circle. Our market timing indicators are giving us a full house buy signal".

So it was today urging clients not to be caught short, and to start buying.

The broker has based its decision on four main indicators valuation, capitulation, risk and fundamentals.

Cynics may say Morgan Stanley has jumped the gun although, with interest rates in the UK set to fall by at least half a point, there is arguably plenty of value to be had among equities. The unanswered question is how deep will the recession be and how long will it last? Shares today rallied from opening falls amid signs of a massive bear squeeze. The news today may have been bad but at least it wasn't disastrous, and that was the signal for stock-market bears to head for the exit.

As a result, the FTSE 100 index of leading shares climbed 115.9 points to 4559.1 while among second-liners the squeeze was even more ferocious with the FTSE 250 index ahead by 293 points at 6736.7. Turnover among leading shares was just over a billion.

A drop in same-store sales and profits from Marks & Spencer could have been a lot worse, and the share price rallied 211/2p to 243p. Even Royal Bank of Scotland was putting a positive slant on a profits warning, but the shares retreated 4.5p to 60.7p. That means its [pounds sterling]20 billion share placing and open offer, which has been underwritten by the Government, is now under water.

One company drawing encouragement from the M& S results was Premier Foods, up 121/2p at 41p. It is a big supplier of food products to M& S, and has been savaged by the bears this year. …

Search by... Author
Show... All Results Primary Sources Peer-reviewed

Oops!

An unknown error has occurred. Please click the button below to reload the page. If the problem persists, please try again in a little while.