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US stocks claw back some of yesterday's heavy losses

Last updated: 01:20 04 Jan 2014 AEDT, First published: 02:20 04 Jan 2014 AEDT

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After taking a bit of a biffing yesterday, US markets are edging higher today ahead of a speech by Fed chairman Ben Bernanke.

The Dow Jones is up 52 (0.3%) at 16,495 while the broader-based S&P 500 is up 4 (0.2%) at 1,836. The tech-stock heavy NASDAQ Composite is up 5 (0.1%) at 4,148.

Bernanke is set to speak in the afternoon at an American Economic Association event in Philadelphia in what will be one of his last major appearances before he steps down at the end of this month.

As in the UK, there is not a lot of corporate news to occupy investors' minds. While in the UK the focus is on retailers' Christmas trading, in the US the spotlight is on car companies and their December sales figures.

Chrysler was quick out of the traps, reporting a 6% year-on-year increase in US sales, below expectations.

Ford is tipped to post a 5.9% rise and General Motors a more modest 0.8% increase.

Social networking giant Facebook is under fire in the US with some users bringing a class-action lawsuit against the firm, alleging it monitors users' private messages.

Elsewhere in the tech sector, FireEye is wanted after the cyber-security firm announced it had acquired rival outfit, Mandiant Corp., in a deal valued at US$1bn.

AIM and NASDAQ-quoted payments processing company Planet Payment (LON:PPT) is notching up gains on both sides of the Atlantic, after it was revealed its boss Philip Beck increased his stake in the company to 4% after exercising share options.

In the US, shares are up 2.5% while in Blighty they are up 6.1%.

In the UK, the FTSE 100 is up 27 (0.4%) at 6,744, with spirits raised by more evidence of an overheating housing market and an upbeat trading update from Next (LON:NXT).

The High Street stalwart raised its full-year profit guidance in stark contrast to department store group Debenhams (LON:DEB), which earlier this week lowered profit guidance.

A strong fourth quarter means the retailer now predicts profit of between £684mln and £700mln for the 12 months to January 25.
The bottom end of this new guidance would represent 10% growth, while the upper end would imply a 12.6% increase. The median forecast of analysts covering the stock prior to the profits guidance upgrade was £666.5mln.

Investors reacted favourably to the news, sparking a 10.2% rise in the share price, which breached £60 for the first time.

Other rag trade retailers followed Next higher, with Primark’s parent AB Foods (LON:ABF) up 1.1% and Britain’s biggest clothing retailer Marks & Spencer (LON:MKS) up 4.5% in third place.

Away from the FTSE 100, online fashion site ASOS (LON:ASC) also revelled in Next’s success, rising 3.9% to a new all-time high of £67.31 a share. Even Debenhams is revelling in the feelgood mood, hardening 3.9%.

Away from the clothing sellers, other retailers are also wanted, helped by data that suggested house prices rose by the most in a single month in December since August 2009.

House prices are widely regarded as being key to consumer sentiment in the UK, with shoppers more prepared to max out on the credit card if they think selling the house will bail them out of difficulties.

DIY chain Home Retail (LON:HOME), up 4.6%, is an obvious beneficiary of the house price surge, while the likes of Dixons (LON:DXNS) and Sports Direct (LON:SPD) are also on the climb.

House builders such as Bovis (LON:BVS), up 2.1%, and Berkeley Group, up 1.8%, also respond well to the housing data.

Elsewhere, there was very little for traders to latch on to.

Wildhorse Energy (LON:WHE) claimed it did not know why its share price rose so rapidly on Thursday. Subsequently, shares in the Hungary-focused unconventional energy group dropped back 9% to 1.75p, before recovering to 1.9p, down 1.3%.

Fastnet Oil & Gas (LON:FAST) has confirmed that the drilling of the FA-1, or Eagle, exploration well offshore Morocco will begin in the first half of 2014 following the signing of a rig agreement.

Johnson Services’ (LON:JSG) boss for the past five years is to stand down with immediate effect, the dry cleaning and textile rental specialist said today.

It added that full year profit before tax will be in line with expectations, while net debt was below £25mln at the end of December.

Shares in the group have risen by almost 50% over the past twelve months as the market has warmed to the group’s attempts to cut its debts and re-focus on textiles services. They added another 4.1% on Friday to 55.45p.

Regal Petroleum (LON:RPT), meanwhile, fell 6.8% as it revealed production has been hampered by shut-downs to gas processing facilities, which were being upgraded.

Shares in Medusa Mining (LON:MML) received a boost on Friday as US investment management firm Van Eck Associated upped its holding to 5.29%.

The shares have been on a tear since the start of December, rising from 98.23p to close at 116p last night, and are up 7.3% to 124.5p today.

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