| | | | | | | CITY INDEX PRESENT TRUMP VERSUS THE FED: ROUND 1 The President-elect and Janet Yellen aren’t exactly best friends. Given Trump’s stimulus plans, how will she react when the Fed make their interest rate announcement on December 13th/14th? Seize the trading opportunity at City Index. Losses can exceed deposits. Trade now | | |
| | London Market Report |  | | FTSE 100 | Euronext | Dax perf | CAC 40 |  |  |  |  | | Please click on the images to view our interactive charts | | | London open: Stocks flat as investors mull hawkish Fed hike, BoE eyed Stocks in London were little changed in early trade as investors digested a 25 basis points rate hike by the Federal Reserve, as anticipated, but a more hawkish tone than expected.
At 0830 GMT, the FTSE was down just 0.1% to 6,940.20. Meanwhile, oil prices were fairly steady, with West Texas Intermediate down 0.2% to $50.94 a barrel and Brent crude up 0.2% to $54.00.
On Wednesday, the Fed raised the range of its main policy rate to between 0.50% and 0.75% and signalled that more interest rate increases were on the cards for next year than it had at the meeting in September. Rate-setters in Washington DC were unanimous in their decision to tighten policy.
According to the newly-submitted 'dot-plot' graphs of interest rates projections from the Federal Reserve's board members and regional Fed presidents, the median expectation is for three quarter-point interest rate hikes in the following year, up from two previously.
A further three hikes were projected in 2018, followed by another three in 2019.
Spreadex's Connor Campbell said: "Raising rates by the expected 0.25%, marking only the second hike in a decade, Janet Yellen struck a hawkish tone on Wednesday despite warning of a 'cloud of uncertainty' that will only disperse once Donald Trump has outlined his intentions more fully.
"The Fed chair also got a subtle dig in at one of the President-elect's most discussed policies, hinting that the proposed infrastructure spend may make little difference to the country's fairly healthy labour market. Arguably the most important news market-wise is that the central bank now expects three, not the previously stated two, rate hikes in 2017 - likely to combat the incoming Trumpflation - a revision that sent the dollar index to a 14-year high."
Investors in the UK were also looking ahead to the Bank of England rate announcement at 1200 GMT amid expectations the bank rate will be kept at a historical low of 0.25% and the asset purchases target will be unchanged at £435bn.
In corporate news, British Gas owner Centrica pushed up after lifting its earnings outlook for the full-year.
Just Eat gained ground after announcing the acquisition of UK rival Hungryhouse and Canada's SkipTheDishes.
GVC Holdings rallied as the FTSE 250 sports betting and gaming group said it expects pro-forma net gaming revenue for the year to the end of December and adjusted earnings to be at the upper end of forecasts.
Distribution and outsourcing company Bunzl nudged lower despite saying it expects revenue to increase for the year mainly due to several acquisitions and after slow growth in the first three quarters.
Royal Dutch Shell edged up as it said chief financial officer Simon Henry will retire after more than seven years in the role, to be succeeded by Jessica Uhl, who will take on the job with effect from 9 March.
Transport operator Go-Ahead Group slipped after saying its rail business is likely to miss expectations following the Southern Rail strikes.
Tate & Lyle was in the red as it appointed Gerry Murphy as chairman designate with effect from 1 April, when Peter Gershon retires.
JD Sports was on the back foot as it hit back at a Channel 4 News report on working conditions at its Rochdale warehouse.
Oilfield services provider Petrofac gushed lower after saying it expects profit for the year to be in line with guidance but slightly below last year.
PZ Cussons ticked lower as the consumer goods group said it was had traded in line with its expectations in the first half of the year. |
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| Market Movers
FTSE 100 (UKX) 6,940.20 -0.13%
FTSE 250 (MCX) 17,641.85 -0.23%
techMARK (TASX) 3,296.69 -0.02%
FTSE 100 - Risers
Centrica (CNA) 224.10p 2.38%
Barclays (BARC) 226.55p 2.16%
Royal Bank of Scotland Group (RBS) 221.40p 1.84%
Lloyds Banking Group (LLOY) 63.66p 1.43%
Carnival (CCL) 4,100.00p 1.36%
AstraZeneca (AZN) 4,352.50p 1.10%
Standard Life (SL.) 364.40p 1.05%
Legal & General Group (LGEN) 240.60p 1.05%
International Consolidated Airlines Group SA (CDI) (IAG) 438.20p 0.99%
Direct Line Insurance Group (DLG) 351.80p 0.95%
FTSE 100 - Fallers
Fresnillo (FRES) 1,082.00p -8.31%
Randgold Resources Ltd. (RRS) 5,555.00p -6.48%
Polymetal International (POLY) 780.50p -3.10%
United Utilities Group (UU.) 866.00p -2.91%
Mediclinic International (MDC) 727.50p -2.28%
BHP Billiton (BLT) 1,328.50p -1.99%
Anglo American (AAL) 1,179.00p -1.95%
National Grid (NG.) 905.00p -1.85%
Old Mutual (OML) 189.80p -1.81%
Hikma Pharmaceuticals (HIK) 1,699.00p -1.74%
FTSE 250 - Risers
GVC Holdings (GVC) 645.50p 4.96%
Aggreko (AGK) 917.50p 4.68%
CYBG (CYBG) 278.50p 2.77%
Just Eat (JE.) 610.50p 2.18%
Barr (A.G.) (BAG) 494.00p 1.86%
SSP Group (SSPG) 386.10p 1.61%
WH Smith (SMWH) 1,469.00p 1.52%
Playtech (PTEC) 777.50p 1.37%
Rentokil Initial (RTO) 208.50p 1.21%
esure Group (ESUR) 196.80p 1.18%
FTSE 250 - Fallers
Hochschild Mining (HOC) 229.90p -5.39%
Acacia Mining (ACA) 378.00p -4.88%
Centamin (DI) (CEY) 124.60p -4.52%
Marston's (MARS) 133.90p -3.88%
Brown (N.) Group (BWNG) 203.10p -3.42%
Inmarsat (ISAT) 712.00p -3.20%
Mitie Group (MTO) 211.70p -2.85%
Kaz Minerals (KAZ) 382.40p -2.52%
Petrofac Ltd. (PFC) 889.00p -2.31% |
| | Six serious reasons to think about Sirius Sirius Minerals has been topping The Share Centre buy list for the last week or so, so why is it proving so popular? Number one: The company
Sirius Minerals is not the company it used to be. This decade, under the leadership of Chris Fraser, the company has been transformed, and today its focus is a polyhalite project in North Yorkshire. Polyhalite is a naturally occurring mineral, consisting of sulphur, potassium, calcium and magnesium, making it effective as part of a fertiliser. But research has been throwing up some interesting findings about a polyhalite, making it seem a lot more valuable. Sirius, which uses the brand name POLY4, says that it believes that the North Yorkshire resource is ‘the world's largest high-grade known polyhalite deposit.’ And big things are expected. Read More... |
| | UK Event Calendar | | Thursday December 15
INTERIM DIVIDEND PAYMENT DATE
PayPoint, Vedanta Resources
INTERIM EX-DIVIDEND DATE
BCA Marketplace, Bonmarche Holdings, British Smaller Companies VCT, Brown (N.) Group, Caffyns, Charles Stanley Group, Circle Property , Cropper (James), Greene King, Halfords Group, JPMorgan Global Growth & Income, Lazard World Trust Fund, Mitie Group, Norcros, Northgate, Plastics Capital, Severfield, Sirius Real Estate Ltd., Speedy Hire, United Utilities Group, Ventus VCT D Shs, Ventus 2 VCT, Ventus 2 VCT 'C' Shares, Ventus 2 VCT D Shs, Ventus VCT, Ventus VCT 'C' Shares, Vianet Group
QUARTERLY PAYMENT DATE
Canadian General Investments Ltd.
QUARTERLY EX-DIVIDEND DATE
Assura , Mercantile Investment Trust (The), Real Estate Credit Investments Ltd, Real Estate Credit Investments Ltd Pref Shs , XP Power Ltd. (DI)
INTERNATIONAL ECONOMIC ANNOUNCEMENTS
Consumer Price Index (US) (13:30)
Continuing Claims (US) (13:30)
Current Account (US) (13:30)
Initial Jobless Claims (US) (13:30)
SPECIAL DIVIDEND PAYMENT DATE
PayPoint
SPECIAL EX-DIVIDEND DATE
British Smaller Companies VCT, Polymetal International
EGMS
Etalon Group Ltd GDR (Reg S), Plus500 Ltd (DI), Riverstone Energy Limited
AGMS
Alternative Liquidity Fund Limited, Falanx Group Ltd, GCM Resources, Gunsynd , Haydale Graphene Industries, InnovaDerma, Leaf Clean Energy Co (DI), Nanoco Group, Northern Venture Trust, Sareum Holdings, Smart (J) & Co., Standard Life Equity Income Trust, Tiso Blackstar Group SE (DI)
TRADING ANNOUNCEMENTS
Centrica, PZ Cussons
UK ECONOMIC ANNOUNCEMENTS
BoE Interest Rate Decision (12:00)
Retail Sales (09:30)
FINAL DIVIDEND PAYMENT DATE
Aeci 5 1/2% Prf, MJ Gleeson
FINAL EX-DIVIDEND DATE
A&J Mucklow Group, Associated British Foods, Brunner Investment 5% Prf, Carr's Group, Gooch & Housego, Hargreave Hale AIM VCT 1, JPMorgan Chinese Inv Trust, Marston's, Numis Corporation, OMG, Orchard Funding Group , Zoopla Property Group
|
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| | Europe Market Report |  | | FTSE 100 | Euronext | Dax perf | CAC 40 |  | | | | | | Europe open: Banks pace the advance as investors digest hawkish Fed hike European stocks edged higher in early trade after the Federal Reserve upped interest rates by 25 basis points, as anticipated, but struck a more hawkish tone than expected, signalling three hikes next year.
At 0850 GMT, the benchmark Stoxx Europe 600 index was up 0.3%, Germany's DAX was 0.5% higher and France's CAC 40 was up 0.6%. In London, the FTSE 100 was down 0.1% as investors eyed the latest rate announcement from the Bank of England amid expectations the bank rate will be kept at a historical low of 0.25% and the asset purchases target will be unchanged at £435bn.
Meanwhile, oil prices were in the black, with West Texas Intermediate up 0.2% at $51.16 a barrel and Brent crude up 0.7% to $54.27.
On Wednesday, the Fed raised the range of its main policy rate to between 0.50% and 0.75% and signalled that more interest rate increases were on the cards for next year than it had suggested at the meeting in September. Rate-setters in Washington DC were unanimous in their decision to tighten policy.
According to the newly-submitted 'dot-plot' graphs of interest rates projections from the Federal Reserve's board members and regional Fed presidents, the median expectation is for three quarter-point interest rate hikes in the following year, up from two previously.
A further three hikes were projected in 2018, followed by another three in 2019.
David Morrison, senior market strategist at SpreadCo, said: "The 25 basis point rate rise was expected. However, the consensus view (or hope) among investors was that the FOMC's 'dot plot' would point to 50 basis points-worth of tightening in 2017. So there was some disappointment when the Committee coalesced around the likelihood of three 25 basis point hikes instead. This led to a surge in the dollar and a sharp sell-off in equities and precious metals.
"However, while the dollar is holding onto gains and precious metals are still under pressure, equities appear to be bouncing back. After all, it's really neither here nor there whether the fed funds rate ends next year just below 1.25% or 1.50%. This is especially the case if the US can look forward to the stimulus of tax cuts, infrastructure spending and less regulation. The danger will come if bond yields shoot higher on fears of inflation taking off. This would be a disaster given the high levels of debt sitting at the base of the global economy."
Banks led the advance on Thursday, with the Stoxx 600 sub-index for the sector up 1.9% on the Fed rate hike.
Elsewhere, British Gas owner Centrica pushed up after lifting its earnings outlook for the full-year.
Royal Dutch Shell edged higher as it said chief financial officer Simon Henry will retire after more than seven years in the role, to be succeeded by Jessica Uhl, who will take on the job with effect from 9 March.
On the downside, Swiss pharmaceutical manufacturer Lonza was under the cosh after announcing the acquisition of US capsule products maker Capsugel for $5.5bn in cash.
French utility EDF tumbled after it warned over its 2017 earnings. |
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| | US Market Report | | Europe open: Banks pace the advance as investors digest hawkish Fed hike European stocks edged higher in early trade after the Federal Reserve upped interest rates by 25 basis points, as anticipated, but struck a more hawkish tone than expected, signalling three hikes next year.
At 0850 GMT, the benchmark Stoxx Europe 600 index was up 0.3%, Germany's DAX was 0.5% higher and France's CAC 40 was up 0.6%. In London, the FTSE 100 was down 0.1% as investors eyed the latest rate announcement from the Bank of England amid expectations the bank rate will be kept at a historical low of 0.25% and the asset purchases target will be unchanged at £435bn.
Meanwhile, oil prices were in the black, with West Texas Intermediate up 0.2% at $51.16 a barrel and Brent crude up 0.7% to $54.27.
On Wednesday, the Fed raised the range of its main policy rate to between 0.50% and 0.75% and signalled that more interest rate increases were on the cards for next year than it had suggested at the meeting in September. Rate-setters in Washington DC were unanimous in their decision to tighten policy.
According to the newly-submitted 'dot-plot' graphs of interest rates projections from the Federal Reserve's board members and regional Fed presidents, the median expectation is for three quarter-point interest rate hikes in the following year, up from two previously.
A further three hikes were projected in 2018, followed by another three in 2019.
David Morrison, senior market strategist at SpreadCo, said: "The 25 basis point rate rise was expected. However, the consensus view (or hope) among investors was that the FOMC's 'dot plot' would point to 50 basis points-worth of tightening in 2017. So there was some disappointment when the Committee coalesced around the likelihood of three 25 basis point hikes instead. This led to a surge in the dollar and a sharp sell-off in equities and precious metals.
"However, while the dollar is holding onto gains and precious metals are still under pressure, equities appear to be bouncing back. After all, it's really neither here nor there whether the fed funds rate ends next year just below 1.25% or 1.50%. This is especially the case if the US can look forward to the stimulus of tax cuts, infrastructure spending and less regulation. The danger will come if bond yields shoot higher on fears of inflation taking off. This would be a disaster given the high levels of debt sitting at the base of the global economy."
Banks led the advance on Thursday, with the Stoxx 600 sub-index for the sector up 1.9% on the Fed rate hike.
Elsewhere, British Gas owner Centrica pushed up after lifting its earnings outlook for the full-year.
Royal Dutch Shell edged higher as it said chief financial officer Simon Henry will retire after more than seven years in the role, to be succeeded by Jessica Uhl, who will take on the job with effect from 9 March.
On the downside, Swiss pharmaceutical manufacturer Lonza was under the cosh after announcing the acquisition of US capsule products maker Capsugel for $5.5bn in cash.
French utility EDF tumbled after it warned over its 2017 earnings. |
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| | Newspaper Round Up | | Thursday newspaper round-up: Brexit, Yahoo, Sky London's lead in financial services technology risks being blunted by bureaucratic new migration rules, according to business leaders cited by the latest House of Lords report on leaving the European Union. Peers conclude that the fast-growing sector is one of a number of world-beating industries at risk if London loses its status as an international melting pot for talent, partly because Europeans may not be able to come to work in the UK so freely. - Guardian
Yahoo said on Wednesday it had discovered another major cyber attack, saying data from more than 1bn user accounts was compromised in August 2013, making it the largest such breach in history. The number of affected accounts was double the number implicated in a 2014 breach that the internet company disclosed in September and blamed on hackers working on behalf of a government. - Guardian
It is vital to fight for the City in the Brexit negotiations, and the Government should not be ashamed to stand up for Britain's banking expertise, a committee of Lords has announced. Senior financiers have told The Daily Telegraph that ministers have warned that they cannot be seen to prioritise the City over other sectors, as bankers are perceived as unpopular figures. - Telegraph
Nearly a quarter of workers at the accountancy giant KPMG attended a private secondary school, the firm has revealed, as it tries to broaden access to the profession. The company said 23pc of its 13,500 workers came from private school, compared to the national average of about 7pc, and a further 14pc came from a selective state school. - Telegraph
21st Century Fox is expected today to make a formal offer to buy Sky in an £18.5 billion takeover. The American company, which is the majority shareholder in Sky with a 39 per cent stake, will offer to buy the remaining shares for £10.75 each, less future dividends, after an informal agreement was reached between the companies last Friday. - The Times
Britain's unemployment rate remained at an 11-year low in the three months to October but employment fell as economists warned that resilience in the economy since the Brexit vote had begun to fade. The number of people out of work fell by 16,000 to 1.62 million, the Office for National Statistics said. However, employment fell by 6,000 to 31.76 million compared to the previous three-month period- the first drop in a year - knocking the employment rate down from its record high of 74.5 per cent to 74.4 per cent. - The Times | | |
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