Morning Market, Monday 28th April 2008

The FTSE was up baout 35 points at 6,128 in its first hour, whilst the FTSE 250 was up about 120 points at 10,140.

Over the pond on Friday, things were looking more settled as the DJI closed up nearly 43 points at 12,891.86, whilst the S&P500 closed up 9 points at 1,397.84, and the Nasdaq actually closed down nearly 6 points at 2,422.93. It had started lower, but picked up as investors felt the week’s satisfactory earnings reports, and that the Fed’s cash input had helped to steady the economy. This week investors will be looking forward to the US Feds Open Market Committee meeting, which is expected to lower its benchmark borrowing rate. The Fed Res cut its key federal funds rate by 3/4% to 2.25% last month, and economists expect a further 1/4% fall this coming Wednesday, although this isn’t certain.

In the Far East today the Nikkei 225 closed up 30.90 points at 13,894.37, whilst in Hong Kong the Hang Seng was up about 95 points at 25,610 by lunchtime chow time.

Staying in the Far East, oil had almost hit that US$120 bbl figure today, wiht he new Grangemouth refinary problems in Scotland causing further concern. Light sweet (June del) was at US$119.93 bbl, whilst Brent North Sea crude (Jun del) was up nearly a buck at $117.25 bbl, about 30cents off its peak of the day.

Back here in London it was Oil stocks, Whitbread and the banks that were all chirping away this week.  Whitbread was up 32p at 1,222 after reporting over a 26% rise in full-year earnings, which was much better than expected. It also said that it plans to increase the size of its Premier Inn hotel chain by 50% in the next five years. Pre-tax profit before exceptional items for year end 28Feb08 was up at £210.3m, up from £166.5m last year. Broker Merrills gave a ‘buy’ recommendation and a 23-quid target.

The banks were also doing well, with press reports that HBOS will be deciding today whether to take a £4 bln rights issue of its own, just to shore up its reserves. HBOS was up a penny at 498p, whilst peers were also doing ok - RBS up 6p at 355p, Barclays up 8p at 475p, and Alliance & Leicester gained 7 at 521-1/2.

As we emntioned above, with oil at nighg-on US$120 bbl, the oil majors were also up.  RD Shell was up 23p at 1,949, BP was up 4p at 584p, BG Group was up 5p at 1,311, Cairn Energy was up 95p at 3,001, and Tullow Oil up 18p at 775.

The miners also did well, with Xstrata up 87p at 4,092, Lonmin up 69p at 3,264, Anto up 15p at 797p, and Vedanta up 32p at 2,389p.

Shire Pharma didn’t have such a good start, though, down nearly 40p at 901p after a  Credit Suisse downgrade to ‘underperform’ from ‘neutral’ and a target cut to 823p, down from 930.

Financial software group Sage was down 4p to 201p after a Morgan Stanley downgrade to ‘underweight’ from ‘overweight’ and a target cut to 185p, down from 255p.

Stagecoach was up over 13p to 235p after a trading up0date that said this last quarter was much better than expected.  Stagecoach said the JV with Virgin Rail had helped its earnings, which is hopes will be at about 20p.  Its peers responded too, with Go-Ahead Group up 30p at 1,687p and National Express up 14p at 930p.

Centrica down a penny at 298p after a Societe Generale downgrade to ’sell’ from ‘hold’ and a target reduction to 260p from 295p.

Shaftesbury was down 10p to 523p after a Citigroup ’sell’ rating and 5-quid target.