European markets gain on Martin Luther King Day
Joshua Raymond, Market Strategist at City Index commented: "European markets started the week in positive fashion with investors using sharp losses on Friday to cherry pick some of the badly beaten equities.
However, with the US markets closed and nothing of real interest on the macro or micro front today, trading volumes are low and the session will give little indication of how the weeks trading may pan out.
We have a very important week of company earnings ahead of us and given the markets reaction to earnings from JP Morgan last week, the banks are likely to catch everyone's gaze, with Citigroup, Bank of America, Morgan Stanley and Goldman Sachs all reporting this week. As a result, investors may be a little jumpy this week and the markets could take turn volatile.
We have seen investors looking to buy into the miners today, with the sector losing almost 7% last week providing the excuse for bargain hunters to come in. Copper prices are also making some advances and this has facilitated further interest within the miners, with Kazakhmys, Anglo American and Xstrata all rallying over 2%.
International Power gains on bid talk
International Power has also been of high interest this morning, with shares up over 7% on speculation that GDF Suez could be set to launch a takeover bid. The speculation has got the speculators moving quickly this morning and this has helped to lift International Power's share prices to a new 15 month high.
Kraft/Cadbury in focus
The pursuit for Cadbury remains a focus as we move closer to tomorrow's deadline for Kraft to raise their bid. Share prices have gained over 6% since the 5th January on hopes that Kraft will return with a higher offer and there has been much speculation over the last few days that they may do so today, which is helping to lift share prices past the 800p mark.
It is looking likely that Cadbury shareholders are looking for a bid higher than 800p but it remains to be seen as to how high Kraft will have to go to entice Cadbury's shareholders to a deal. With the press speculating over the weekend that Hershey may launch their own offer this week, this could force Kraft's hands to increase their bid before tomorrow's deadline."