Liams Last Post : Bond yields go over 7% , AIB new low , C&C rallies , US economy strengthening.

Good Afternoon ,

 

Thanks Brian for the understatement of the year…Brian Cowen mentioning that there is turbulence in bond markets. Irish 10 year bonds closing at 7.01% yield having been higher in the course of the day and a 450bp spread vs German bonds. Hmmm it has not gone away…

 

British Airways had decent results this morning that beat consensus but the stock fell -3.5% this in the course of the day. Ryanair fell -1.5% on news that the OFT in the UK is to probe the airlines shareholding in Aer Lingus. Aer Lingus welcomed this decision as it increases the pressure on Ryanair to dispose of the stake. This however is contrary to Ryanair CEO recently expressed intentions.  

 

The Financials were all weaker today , AIB fell to a new low of 34c which certainly did not help sentiment at all towards the rest of the financials.

 

Ex Ireland US GDP grew at 2% in line with forecasts and the news was well received as was the household expenditure component which grew by +2.6% and is showing signs of acceleration.  Euro-area consumer prices rose 1.9 % in October from a year earlier after increasing 1.8 % in September. This inflation report is an initial estimate with a detailed breakdown due on November 16^th. The unemployment rate was 10.1 % in September, the highest since July 1998,

 

Barton Biggs managing partner of New York-based Traxis Partners LLC, said in an interview with Betty Liu on Bloomberg Television's "In the Loop." U.S. stocks may rise 10 percent should the Federal Reserve signal quantitative easing next week, and emerging markets, while halfway to a bubble, will probably

keep gaining,  Biggs said that the conventional wisdom is that the markets are going to probably sell off after the election and after the Fed's

quantitative easing announcement but he thinks that Investors may in fact get a "surprise" with "another 10 percent rally after the announcement."  Food for thought.

 

 C&C went on a little run today and gained nearly 4.7%

 

 A busier week looms next week with Ryanair Q2 numbers on November 1^st and Kerry IMS next thursday and the market will focus on CRH again with their IMS due on November 9^th and DCC interim results also due that day. Smurfit Kappa Q3 is due on the 10^th.   We get back to some newsflow after a sort of hiatus for the last few weeks.

 

Have a good weekend

 

Liam

 

 

 

___________________________________________

Liam Boggan

　

Merrion Stockbrokers

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