Cambridge Index rises 2.1%

24/02/2010

The Cambridge Index gained 2.1% or 128.4 points to 6,294.7, as seven of the top 10 index heavyweight stocks recorded healthy returns.

Global equities maintained their upward march as investors shrugged off an unexpected hike in the discount rate by the US Federal Reserve, while speculating that the first monthly fall in core CPI since 1982 would prompt the Fed to continue with its easy monetary stance. Upbeat earnings reports and positive economic data lent further support to the markets during the week.

 

In keeping with the upward trend, the Cambridge Index gained 2.1% or 128.4 points to 6,294.7, as seven of the top 10 index heavyweight stocks recorded healthy returns.

Johnson Matthey rose 3.0%, as platinum prices edged up during the week. ARM Holdings gained 2.7%, after BMO Capital Markets initiated coverage on the stock with an “Outperform” rating. ARM announced that Samsung has adopted the ARM(R) Mali(TM) graphics processor architecture. Also featuring among the gainers were Domino Printing Sciences, CSR and DS Smith, all up between 1.4% and 4.9%.

230210_Cambridge Index and FTSE AIM 100 movement

Sepura jumped 15.1%, emerging as the top gainer in the Cambridge Index. Sagentia Group, up 10.0%, announced that full-year revenues decreased 18% to £23.8 million and pre-tax loss widened to £3.5 million. On the outlook front, the company mentioned that it is in a good position to respond to the changing market conditions in 2010.

Sareum Holdings added 7.9%, after the company announced that its pre-tax loss for the first half ended 31 December 2009 narrowed to £0.32 million from £0.89 million recorded in the previous year. Other prominent gainers were Greene King,

Pursuit Dynamics and LPA Group, all up between 3.3% and 8.2%. Amino Technologies rose 1.6%, after the company announced that it has won an order from Costa Rican Electricity Institute (ICE) to supply set-top boxes in support of ICE’s ”major” IPTV rollout. 
 
Cyan Holdings dropped 7.7% to 1.9p, becoming the top loser in the Cambridge Index. Bango, down 5.2%, reported a 600% growth in mobile web usage. Other noticeable losers included ITM Power, Phytopharm and ANT, all down between 3.3% and 5.2%. 
The benchmark FTSE 100 index rallied 4.2% to 5,358.2, buoyed by increased risk appetite among investors.

Barclays led the UK banking sector higher, as its full-year profit before tax rose to £11.64 billion from £6.08 billion, surpassing market expectations, and after Abu Dhabi’s government increased its stake in the bank to 5.2%. The sector also benefited from a bullish note on UK banks by Citigroup, which increased the earnings forecasts and target prices.

Robust results posted by their European peers, BNP Paribas and ING Group, helped to further shore up investor sentiment. Firm metal prices and Goldman Sachs’ prediction of higher growth (of 11.4%) for China’s 2010 GDP supported index heavyweight miners. The FTSE AIM 100 Index was up 2.4% to 3,067.6, while the FTSE techMARK 100 Index gained 3.2% to 1,759.1.

Even as the US Federal Reserve hiked the rate it charges for direct loans to banks for the first time since 2006, markets moved upwards during the week, encouraged by positive economic data, and better-than-expected quarterly earnings from companies such as Merck, Deere and Hewlett-Packard.

The industrial sector recorded a higher-than-expected 0.9% rise for January and increased manufacturing activity in the New York and Philadelphia regions. Furthermore, housing starts climbed 2.8% to an annual rate of 591,000 units in January, a six-month high. The Dow Jones Index gained 3.0% to 10,402.4, while the Nasdaq Index rallied 2.8% to 2,243.9.

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