FTSE charges higher after company earnings and broker actions lift optimism

<p>A combination of positive factors including company earnings, broker recommendations and bid speculation has helped to encourage investors to buy into equities today, pushing the […]</p>

A combination of positive factors including company earnings, broker recommendations and bid speculation has helped to encourage investors to buy into equities today, pushing the FTSE 100 higher by 1% and back above the 6000 level once again.

There are a lot of positive catalysts to today’s markets that is helping to boost optimism that the last few days of losses were more about profit taking than a change in sentiment. The fact that the FTSE 100 has quickly regained the 6000 level once more raises confidence that the recent bull trend could continue, particularly if the UK Index can consistently maintain above the 6050 level.

Alcoa’s numbers brighten hopes for a good Q4
Earnings from US miner Alcoa, which beat markets expectations, has boosted hopes for a strong earnings season and this has helped to encourage higher risk appetite in some of the key miners this morning. A stronger Copper price, which has shunned the stronger dollar, has also helped to facilitate buyer demand for mining shares.

That said, investors are likely to want to see earnings from tech bellwether Intel and bank JP Morgan later in the week before buying into an outperforming US earnings season.

ARM jumps another 6%
Bid talk continues to lift the market with shares of ARM Holdings this time taking flight to lead the FTSE 100 winners list, jumping 6%. Bid talk has surrounded the chip designer for some time now with Apple, Intel and Microsoft being widely speculated by some of the UK press. We have seen high investor interest in ARM’s shares since the announced Microsoft deal, both in terms of what the deal could bring ARM but also how its rivals may react.

CSR shares leap on patent settlement
CSR shares leapt 13.5% on Tuesday after the chipmaker settled a legal battle over patents with US rival Broadcom. The settlement figure comes in at $67.5m, which will be paid over the next 5 years, and will be offset by a reduction in legal costs of at least $50m. Some analysts have also predicted the settlement could result in a 10% jump in both operating profit and EPS.

The patent legal issue had created a cloud of uncertainty over the firm, and this has kept its shares pinned down of late whilst rival chip makers such as ARM have enjoyed a good run. Investors clearly are taking the settlement as drawing a line in the sand and this has helped to free up strong buyer demand for its shares.”

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