CFD Traders Diary
Black Monday avoided and a relief rally
4/3/2008
It looks as though there is still life in the bulls after what could have been a very difficult session yesterday, and today the focus moved back to very busy reporting schedule as the FTSE 100 index set off at a pace on a relief rally. This did not last too long however with a bout of selling mid-morning leaving the index around 20 points ahead.
Although there were no major movers in the blue chips, one or two shares stood out, with Schroders leading the way on the back of good year end results showing a 35% profit rise. As with many groups at the moment, it did add a note of caution, saying the difficult market conditions would have a less favourable impact on its business, but given that some investors had expected the worst, the outlook appears reasonable here.
Down at the bottom end was Admiral, whose shares have been resilient this year. Although its 2007 pre-tax profits were better than expected, it added that improved premiums in the UK car insurance markets would not hit market results until 2008, and it would also be a much tougher year for its comparison website Confused.com. It's not a profits warning as such, but there is no room for disappointment here and the shares may drift until we see better market conditions.
Another stock that has been in fine form recently is Cable & Wireless, which set new growth targets today for the next five years and reiterated its EBITDA guidance for 2007/08, but as is often the way at the moment profit takers jumped in, so whilst it looks set fair for the future, we may have seen the best in the short term.
