Shares settle

25 April 2008

There was much rejoicing on the London Stock Exchange in late March when the FTSE 100 Index broke through the 6000 point barrier for the first time in five years. It still has some way to go before it reaches the levels seen in 2000 at the height of the dot.com and telecoms booms, but it is certainly heading in the right direction.

The FTSE gained 2.91% between weeks 8 and 12, and its longer-term buoyancy is reflected by the fact that it is up 22.68% from a year ago, when it was flirting with the 5000 point barrier. Even stronger during March was the Topix 500, which gained 3.42%, following something of a lull in the first two months of the year. This Index is up an impressive 41.82% for the last 12 months, reflecting strong business confidence in Japan.

The Dow also did well over the last month, with a 2.24% rise. Over the longer term though, it has been a little subdued, with just an 8.24% gain since March 2005.

Unusually,IC 's Share Index for the crane manufacturing fraternity lagged behind the mainstream indexes, with just a 1.11% increase in March. However, it is the clear winner over the longer term, with its value currently a massive 66.01% higher than it was a year ago. It should also be pointed out that its value of 378.31 points at the end of week 12 is an all- time record.

It is too early to say whether March's performance is just a temporary lull in theIC Index's inexorable rise, or whether it is the first sign of a slowdown after almost three years of robust growth. Unfortunately the performances of the individual companies in the Index provide only mixed messages.

March's strongest performer was Manitowoc with an 8.85% gain, and recent announcements from the company indicate that it is very up- beat about prospects for the early part of the year. In contrast fellow US manufacturer Terex lost 4.65%.

In Europe, KCI Konecranes went ahead with a 4 for 1 stock split in week 12, and its share price rose 8.14%. Stock splits are generally positive signs - they raise the number of shares available on the market, in this case it was a four-fold increase, and are indicative of high demand for a company's equity.

The Japanese manufacturers were more subdued, with Hitachi and Kobe Steel posting moderate gains, and Tadano seeing a 4.65% drop.

Currencies

March saw the US Dollar weaken -0.24% against the Yen and -1.42% against the Euro. However, a meeting of the Federal Reserve in week 13 was widely expected to result in another 0.25% rise in US interest rates, which may help the Dollar to stabilise, or even continue the rally that has been seen over the last year. •

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