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| | London Market Report |  | | FTSE 100 | Euronext | Dax perf | CAC 40 |  |  |  |  | | Please click on the images to view our interactive charts | | | London open: Stocks lower as Gilt yields hit post-Brexit high Stocks started the session moving lower as the yield on the benchmark 10-year Gilt set another post-Brexit high.
At 0822 BST, the FTSE 100 was trading 0.46% or 32.72 points lower at 6,980.72 and the yield on the 10-year Gilt was up by eight basis points to 1.17%.
Cable was trading lower by 0.08% to 1.2175 after earlier hitting an intra-session low of 1.2150.
Gilts underperformed at the end of the previous week, in part tracking losses on US Treasuries after a speech from Fed chair Janet Yellen in which she said that policymakers need to consider the potential benefits of a "high pressure economy" in which the labour market was allowed to tighten more.
Speaking to BBC Radio on Monday morning, Monetary Policy Committee member Ben Broadbent emphasised the importance of a flexible currency when asked whether the Bank of England might intervene in currency markets.
Broadbent also indicated he was not concerned with the possibility that inflation might overshoot the Bank´s target "somewhat".
Against that backdrop, investors were waiting on a speech from US Fed vice chairman, Stanley Fischer, scheduled for later in the day.
At the close of trading in New York on 14 October, Fed funds futures were assigning a 69.5% probability to a 25 basis point interest rate hike by the US central bank when it met in two months´ time.
To take note of - especially for investors in the pharmaceutical sector - the latest WSJ/NBC poll gave US presidential candidate Hillary Clinton an 11 point lead over Donald Trump with just one month to go before the elections and ahead of the following Wednesday´s televised debate.
"Nothing in last week's US economic data appears to have altered expectations that the Federal Reserve will look to raise interest rates by the end of this year, probably at its meeting in December. The currency markets already appear to be pricing in just such a prospect with the US dollar index closing at its highest level since early March.
"Last week's Fed minutes didn't really alter that calculus either, in fact they only served to reinforce it, given the fact that recent economic data shows no signs of any significant weakness. Friday's retail sales numbers for September came in slightly ahead of expectations, more than reversing the small decline seen in August, while weekly jobless claims continue to come down," said Michael Hewson, chief market analyst at CMC Markets.
Pearson starts lower
In corporate news, underlying sales remained underwhelming at Pearson in the third quarter but it reported improving trends since September and that the weakness in the pound is likely to provide a material lift to full year numbers. Sales were down 7% at the underlying level in the nine months to the end of September but were down 3% at headline terms due to the dollar-sterling exchange rate, which could push earnings per share 4.5p higher for the calendar year.
Scottish energy company SSE is to sell a stake in Scotia Gas Networks to subsidiaries of the Abu Dhabi Investment Authority for £621m.
The company will sell 16.7% of its stake and retain 33.3% equity in SGN by the end of the October, with the proceeds used to return value for shareholders or invested, which will be announced on 9 November.
Bookmaker Ladbrokes announced on Monday that subsidiaries of both itself and merger partner Gala Coral Group have agreed to sell a total of 359 licensed betting offices to Done Brothers Cash Betting Limited - trading as Betfred - and StanJames Abingdon - trading as Stan James.
The FTSE 250 firm said Betfred will purchase 322 shops for a cash consideration of £55m, and Stan James will purchase 37 shops for a cash consideration of £0.5m. |
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| Market Movers
FTSE 100 (UKX) 6,972.08 -0.59%
FTSE 250 (MCX) 17,862.99 -0.65%
techMARK (TASX) 3,529.16 -0.42%
FTSE 100 - Risers
Standard Chartered (STAN) 661.40p 1.43%
Anglo American (AAL) 1,014.50p 0.84%
Provident Financial (PFG) 3,059.00p 0.76%
ITV (ITV) 173.60p 0.64%
Glencore (GLEN) 229.65p 0.61%
Rio Tinto (RIO) 2,611.00p 0.58%
Randgold Resources Ltd. (RRS) 6,825.00p 0.37%
Polymetal International (POLY) 852.50p 0.35%
United Utilities Group (UU.) 947.00p 0.32%
Centrica (CNA) 211.60p 0.14%
FTSE 100 - Fallers
Pearson (PSON) 792.50p -4.80%
Persimmon (PSN) 1,672.00p -1.99%
Barratt Developments (BDEV) 474.00p -1.80%
Royal Mail (RMG) 489.10p -1.57%
Mediclinic International (MDC) 901.50p -1.42%
Taylor Wimpey (TW.) 143.20p -1.24%
Royal Bank of Scotland Group (RBS) 170.70p -1.22%
Imperial Brands (IMB) 3,843.00p -1.21%
Next (NXT) 4,549.00p -1.15%
BAE Systems (BA.) 537.00p -1.10%
FTSE 250 - Risers
Euromoney Institutional Investor (ERM) 1,017.00p 2.11%
SIG (SHI) 114.20p 1.42%
Spire Healthcare Group (SPI) 384.20p 1.37%
Vedanta Resources (VED) 643.50p 1.34%
UK Commercial Property Trust (UKCM) 79.80p 1.14%
Aberforth Smaller Companies Trust (ASL) 1,025.00p 0.99%
Sophos Group (SOPH) 249.80p 0.93%
IP Group (IPO) 147.80p 0.82%
Telecom Plus (TEP) 1,115.00p 0.81%
Kaz Minerals (KAZ) 260.20p 0.77%
FTSE 250 - Fallers
PayPoint (PAY) 1,109.00p -5.05%
Debenhams (DEB) 52.75p -4.44%
Countrywide (CWD) 191.50p -3.04%
Rank Group (RNK) 197.80p -2.61%
Ladbrokes (LAD) 135.70p -2.44%
Ted Baker (TED) 2,521.00p -2.29%
OneSavings Bank (OSB) 269.30p -2.25%
Polypipe Group (PLP) 259.70p -2.18%
DFS Furniture (DFS) 248.00p -1.98% |
| | UK Event Calendar | | Monday 17 October
INTERNATIONAL ECONOMIC ANNOUNCEMENTS
Capacity Utilisation (US) (14:15)
Consumer Price Index (EU) (10:00)
Empires State Manufactacturing (US) (13:30)
Industrial Production (US) (14:15)
FINALS
Applied Graphene Materials , Avacta Group, Bioventix, Lok'n Store Group, Tristel
AGMS
City of London Investment Group, Clipper Logistics
FINAL DIVIDEND PAYMENT DATE
HML Holdings, National Westminster 9%pf, Renishaw
|
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| | US Market Report | | US close: Stocks rise as Yellen argues benefits of tight labour market US stocks finished slightly higher on Friday as Federal Reserve chair Janet Yellen said she sees some benefit to allowing inflation to run above the central bank's 2% target.
The Dow Jones Industrial Average increased 0.22% to 18,138.38 points, the S&P 500 rose 0.02% to 2,132.98 points and the Nasdaq grew 0.02% to 5,214.16 points.
In contrast oil prices fell as the dollar strengthened and data from Baker Hughes showed US drillers added four rigs in the week to 14 October.
West Texas Intermediate crude dropped 0.19% to $50.34 per barrel and Brent dipped 0.07% to $51.99 per barrel at 2141 BST.
The dollar rose 0.40% versus the pound, 0.75% against the euro and 0.43% against the yen. A stronger dollar makes oil more expensive for importers trading in other currencies.
In a speech at the Boston Fed conference, Yellen said it may be wise to run a "high pressure" economy with a tight labour market to reverse some of the negative effects of the Great Recession.
On the data front, US retail sales rose 0.6% in September, as expected by analysts, following a revised 0.2% fall in August, the Commerce Department revealed.
Elsewhere, a survey from the University of Michigan found consumer sentiment in the US unexpectedly deteriorated in October, dropping to its lowest level since last September and the second-lowest in the past two years.
The preliminary reading of the consumer sentiment index fell to 87.9 from 91.2 in September and 90.0 in October last year. Economists had been expecting a reading of 91.9.
Earlier, Chinese data gave global stocks a boost as it improved more than forecast.
China's consumer price index rose 1.9% year-on-year in September following a 1.3% increase in August. Economists had pencilled in a 1.6% gain.
Producer prices climbed 0.1% last month, beating forecasts for a 0.4% drop and following August's 0.8% decline.
Meanwhile, US earnings were in focus.
JP Morgan Chase shares snapped an earlier rally as it reported quarterly earnings and revenue that beat expectations.
Wells Fargo also erased gains as a sales-tactics scandal that led to the departure of the company's CEO John Stumpf earlier this week overshadowed its better-than-expected third quarter results.
HP Inc. slumped after issuing a cautious outlook and announcing plans to cut 3,000 to 4,000 employees.
Salesforce.com Inc. gained following reports that the company has withdrawn interest in buying Twitter Inc.
Dow Jones - Risers
Goldman Sachs Group Inc. (GS) $170.61 1.85%
E.I. du Pont de Nemours and Co. (DD) $69.04 1.31%
Intel Corp. (INTC) $37.45 1.30%
Microsoft Corp. (MSFT) $57.42 0.88%
Caterpillar Inc. (CAT) $87.69 0.80%
Visa Inc. (V) $82.47 0.71%
Apple Inc. (AAPL) $117.66 0.58%
International Business Machines Corp. (IBM) $154.47 0.47%
General Electric Co. (GE) $28.88 0.42%
Wal-Mart Stores Inc. (WMT) $68.45 0.32%
Dow Jones - Fallers
McDonald's Corp. (MCD) $114.09 -1.14%
Nike Inc. (NKE) $51.62 -0.79%
Johnson & Johnson (JNJ) $117.56 -0.59%
Merck & Co. Inc. (MRK) $62.14 -0.59%
American Express Co. (AXP) $60.15 -0.43%
JP Morgan Chase & Co. (JPM) $67.54 -0.32%
Pfizer Inc. (PFE) $32.67 -0.31%
Coca-Cola Co. (KO) $41.67 -0.22%
Unitedhealth Group Inc. (UNH) $133.91 -0.20%
Exxon Mobil Corp. (XOM) $86.52 -0.02%
S&P 500 - Risers
Salesforce.Com Inc. (CRM) $74.27 5.15%
Westrock Company (WRK) $46.71 3.68%
Level 3 Communications, Inc. (LVLT) $46.15 2.35%
Analog Devices Inc. (ADI) $62.06 2.22%
First Solar Inc. (FSLR) $39.47 2.04%
Chesapeake Energy Corp. (CHK) $6.55 2.02%
International Paper Co. (IP) $46.73 1.99%
Goldman Sachs Group Inc. (GS) $170.61 1.85%
Expedia Inc. (EXPE) $120.80 1.78%
Intercontinental Exchange Inc (ICE) $271.29 1.77%
S&P 500 - Fallers
Southwestern Energy Co. (SWN) $12.89 -5.43%
HP Inc (HPQ) $14.48 -4.42%
EQT Corp. (EQT) $67.45 -4.14%
United Rentals Inc. (URI) $75.29 -3.76%
Mylan Inc. (MYL) $36.50 -3.64%
Range Resources Corp. (RRC) $37.98 -3.63%
Macy's Inc. (M) $35.57 -3.34%
CF Industries Holdings Inc. (CF) $22.27 -3.30%
Kohls Corp. (KSS) $43.70 -3.19%
Royal Caribbean Cr (RCL) $69.97 -2.90%
Nasdaq 100 - Risers
Analog Devices Inc. (ADI) $62.06 2.22%
Kraft Heinz Co. (KHC) $88.53 1.70%
Micron Technology Inc. (MU) $17.13 1.66%
Maxim Integrated Products Inc. (MXIM) $38.20 1.65%
Liberty Media Corporation - Class A (LMCA) $27.96 1.53%
Stericycle Inc. (SRCL) $75.47 1.47%
Intel Corp. (INTC) $37.45 1.30%
Activision Blizzard Inc. (ATVI) $43.69 1.23%
Netflix Inc. (NFLX) $101.46 1.23%
eBay Inc. (EBAY) $31.89 1.21%
Nasdaq 100 - Fallers
Mylan Inc. (MYL) $36.49 -3.67%
Incyte Corp. (INCY) $87.10 -2.71%
Biomarin Pharmaceutical Inc. (BMRN) $85.03 -2.12%
Celgene Corp. (CELG) $98.51 -2.11%
Tesla Motors Inc (TSLA) $196.51 -1.86%
Cognizant Technology Solutions Corp. (CTSH) $50.34 -1.78%
Henry Schein Inc. (HSIC) $153.36 -1.72%
Vertex Pharmaceuticals Inc. (VRTX) $79.23 -1.65%
American Airlines Group (AAL) $38.65 -1.50% |
| | Bargain Blue Chips | | Is the current dip a buy opportunity? The UK's blue chip stock index has delivered exceptional trading opportunities to date in 2016 and, with the FTSE100 currently consolidating, optimism remains that the trend will resume imminently. Download this exclusive report to find out why a good run of UK macro data has been taken badly by the markets, what key event in September could pump them up once more, and which key stocks that could play a leading role in boosting the index back to last year's all-time record highs. Losses can exceed deposits |
| | Newspaper Round Up | | Monday newspaper round-up: New Brexit plans, dividends, supermarkets Britain would continue to pay billions of pounds into the EU budget after Brexit to maintain cherished single-market access for the City of London and other sectors under plans being discussed by Theresa May's cabinet. The prime minister's demand that Britain controls its borders and throws off the jurisdiction of EU judges has led many in London and Brussels to conclude that British-based banks and insurers would inevitably lose the "passporting" rights that allows them to trade freely in Europe. - Financial Times
Britain has become a less desirable place for companies to invest because of uncertainty surrounding Brexit. The country has dropped from second to the seventh most favourable destination for mergers and acquisitions as investors delay deals while its future with mainland Europe remains unclear, a survey by EY has found. - The Times
Banks could start making decisions to move assets out of the UK as early as the end of 2017 if there is no deal in place to maintain their rights to sell services freely across the European Union, a leading thinktank has warned. Open Europe, which took a neutral stance on the referendum, said Britain could risk losing its status as a hub for financial services unless passporting rights are made the top priority in negotiations with the EU. - Guardian
The chancellor has angered Eurosceptic ministers by calling for a delay on migration curbs that would lead to a hard Brexit and dismay business. Philip Hammond suggested that members of the Brexit cabinet committee should continue examining options after Amber Rudd, the home secretary, put forward plans for a visa-entry scheme for skilled migrants that would close the door to low-skilled migrants from the EU. - The Times
The plunging value of sterling has provided a £2.5bn dividend boost to owners of London-listed shares, with the drop in the pound making global firms' payments more valuable, according to new figures. Despite several industries including mining and retail cutting billions from their payments to shareholders this year, the boost from currency changes meant that overall dividends rose 1.6pc to £24.9bn in the third quarter of 2016, research from Capita Asset Services said. - Telegraph
Britain's biggest supermarkets have been accused of treating suppliers unfairly by demanding savings when the pound was strong but refusing to share the burden of higher costs now that sterling has collapsed. Concerns have been raised with the Groceries Code Adjudicator, the supermarket watchdog, that retailers who requested price reductions when suppliers gained from the stronger currency were stonewalling the same suppliers as they struggled to deal with the fall in sterling since the European Union referendum. - The Times
Retailers are poised to impose a wave of price rises that could add 5 per cent to shopping bills in the new year after the pound plunged by more than the worst forecast of so-called 'Project Fear'. The hikes, expected to hit soon after Christmas, will cost consumers an estimated £15billion next year. - Mail
Britain should brace itself for a growth slowdown in the coming years, as falling consumer spending and business investment applies the brakes to the UK economy, a report has said. Influential thinktank EY Item Club said the UK economy will produce GDP growth of 1.9% this year, fuelled by a 2.5% rise in consumer spending on the back of low inflation. - Guardian
The European Central Bank is becoming dangerously over-extended and the whole euro project is unworkable in its current form, the founding architect of the monetary union has warned. "One day, the house of cards will collapse," said Professor Otmar Issing, the ECB's first chief economist and a towering figure in the construction of the single currency. - The Times
The Treasury is facing demands to strengthen the independence of the Office for Budget Responsibility after being criticised for meddling in its affairs. Officials had pledged to redraft the so-called memorandum of understanding to protect the watchdog from interference from Whitehall and to put an end to political interference in economic and fiscal forecasting. - The Times
The property rental market is booming at the expense of the sales market, making it look as if house-buying will be outstripped for the first time in eight decades next year, as home-buyers face a continued struggle to find properties they can afford. Activity in the sales market has cooled since June's Brexit vote and a lack of property for sale combined with rising prices are set to lead to more new lets than purchases, the UK's largest estate agency chain, Countrywide, said. - Guardian
A system set up by bookmakers to address problem gambling is in disarray, according to campaigners, after a report exposed vast differences in how firms apply the measures. The report, produced by accountancy group PwC and seen by the Guardian, found flaws in how betting shops use "player awareness systems", which are meant to curb addiction to fixed-odds betting terminals (FOBTs). - Guardian
Ladbrokes and Coral have agreed to sell more than 350 betting shops as part of their £2.3billion merger. Rivals Betfred will buy 322 shops for £55million and Stan James will purchase 37 sites for £500,000. - Mail
Companies should remove candidates' names from job applications and offer flexible working from the outset of the recruitment process to create a more dynamic and diverse workforce, according to employers' body the CBI. In a new report, published on Monday, the CBI will highlight the economic and social challenges facing the UK that have been "thrown into sharp relief by Brexit" and focus on issues of productivity and inclusion. - Guardian |
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