| | | London stocks ticked lower in early trade on Wednesday as investors eyed a slew of key data releases amid ongoing trade war concerns. At 0840 BST, the FTSE 100 was down 0.1% to 7,231.19, while the pound was 0.1% firmer against the dollar at 1.3159 and 0.2% higher versus the euro at 1.1456. Trade relations between the US and China were on investors' minds again after US Treasury Secretary Steven Mnuchin renewed a warning to China not to engage in competitive currency devaluation. Neil Wilson, chief market analyst at Markets.com, said: "As previously argued there is a risk that a full-blown trade conflict leads naturally to a currency war as countries affected by tariffs devalue to remain competitive. Currency and trade are just two sides of the same coin. Without the firepower on trade, China’s chief weapon is its currency and it is no surprise if it were to utilise this." On the UK data front, industrial and manufacturing production figures are due at 0930 BST, along with the goods trade balance and gross domestic product for August. UK economic growth is expected to have eased to just 0.1% on the month from 0.3% in July. Meanwhile, manufacturing and industrial production are expected to have picked up marginally. In corporate news, British American Tobacco fell after chief marketing officer Andrew Gray quit after a 32-year career, just two weeks after he was overlooked for the top job. DS Smith, Smurfit Kappa and Mondi were all on the back foot on news that ND Paper, the Illinois-based subsidiary of Hong Kong's Nine Dragons Paper plans to invest $300m over the next two years into its mills in Wisconsin and Maine. Rank Group was under the cosh after the Gambling Commission said it must pay £500,000 for failing to follow rules that protect problem gamblers, while International PPL was in the red after announcing plans to raise around £75m in an equity placing. On the upside, PageGroup rallied after saying it expects its full-year operating profit to be marginally ahead of consensus after notching its highest quarterly growth rate in seven years. HSBC was a touch higher even after it emerged overnight that it has agreed to pay a $765m settlement in the US over its sale of mortgage-based securities in the run-up to the financial crisis. SSE was steady after its merger with Npower was provisionally cleared by the UK's Competition and Markets Authority. In broker note action, Ocado was the top riser after being lifted to 'equalweight' at Barclays. Dixons Carphone was boosted to 'buy' by HSBC, Rio Tinto was raised to 'buy' at Goldman and Sage was upgraded to 'hold' at Deutsche Bank. Soco International was upgraded to 'outperform' at RBC Capital Markets. Rightmove was bumped up to 'buy' at Liberum and Hunting was cut to 'equalweight' at Barclays. | | | | | Bespoke Market Trading Services EBLN provides bespoke research and market intelligence. Receive:
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| | | Europe open: Gains for Big Oil offset drag from trade, Italy concerns | | | | | Stocks are trading slightly lower at the start of the session, with a jump in Oil&Gas names helping to offset the drag on sentiment from early selling in Italian debt. In the background, trade tensions with China continued to simmer. Commenting on the market backdrop, Mike van Dulken, research director at Accendo Markets, said: "A flat opening call comes amid mixed global trading. Wall St extended its losing streak despite bond yields easing on global growth fears (IMF cut estimates) and Trump criticising a hawkish Fed, dragging USD back from 7-week highs. "Asian bourses, whilst choppy, showed signs of finding their feet after the recent sell-off, although trade fears remain to the fore after US Treasury Secretary Mnuchin renewed a US warning to China not to engage in competitive currency devaluation." As of 0843 BST, the benchmark Stoxx 600 was dipping 0.26% or 0.99 points to 371.94, alongside a decline of 0.73% or 147.32 points to 19,918.34 for the FTSE Mibtel and a drop of 0.57% or 31.30 points to 5,287.25 on the Cac-40. Helping to limit the downside in share prices across the Continent, the Stoxx 600's Oil&Gas sector index was advancing 0.97% to 361.48 on the back of concerns that hurricane Michael might exacerbate the supply situation Stateside. Going the other way, the equivalent gauge for Retail shares was down by 0.67% at 294.56 after analysts at Morgan Stanley downgraded their view on the EU luxury goods space. According to analyst Krupa Patel, the recent out-performance of 'value' stocks versus 'growth' had further room to run; hence his decision to downgrade the sector to 'underweight' from a 'top-down' perspective. In parallel, the yield on the benchmark 10-year Italian government note was up by 12 basis points at 3.59%, while euro/dollar was essentially flat at 1.1937. Pressuring Italian BTPs, Italian deputy minister, Matteo Salvini, said he was "absolutely sure" the risk premium on the country's debt would not exceed 400 basis points. On Monday morning, the risk premium versus German Bunds, was at 304 basis points, having reached 315 on Tuesday. Speaking before the budget committee of Italy's lower house of parliament overnight, the economy minister, Giovanni Tria, said if the yield spread on Italia debt hit 400 or 500 basis points, then "the government will do what it needs to do, as Draghi did," ANSA reported. Elsewhere, INSEE reported that industrial production in France was higher by 0.3% month-on-month in August, edging past forecasts for a rise of 0.2%. Meanwhile, in Italy, ISTAT reported that industrial output jumped by 1.7% versus July (consensus: 0.8%). For later in the day, investors were waiting on the release of the US producer price index for August, at 1330 BST. | | | US close: Wall Street sees mixed trading as bond yields continue their ascent | | | | Wall Street trading ended on a mixed note on Tuesday as bond yields resumed their march higher. At the close, the Dow Jones was 0.21% lower at 26,430.57 and the S&P 500 was 0.14% weaker while the Nasdaq was 0.03% firmer at 7,738.02. Meanwhile, the yield on the benchmark 10-year US Treasury note was dropped to 3.208% after moving above the 3.25% threshold for the first time since late April 2011. "Rising rates are a double whammy for stocks - higher corporate debt costs, a lower premium to hold riskier assets against safe-haven Treasuries," said Neil Wilson, chief market analyst at Markets.com. "The question is do rates rise further from here? A confluence of factors mean[s] US yields could continue to climb with the Fed tightening for longer, its balance sheet being reduced and a huge issuance of debt to fund the tax cuts in the US. But if anything, the US economy just looks stronger and stronger and this yield story is not a reflection of fears of it being a bubble, but of greater confidence in growth." Over in Europe, the yield on Italy's 10-year government bond hit a new four-and-a-half year high of 3.63% as finance minister Giovanni Tria gave a downbeat assessment to parliament of the country's fiscal outlook and said he wanted to have constructive talks with the EU after the European Commission said it was concerned about Italy's budget plans. In corporate news, the White House made a rare exception on Tuesday as the administration was beginning to take steps towards its next set of sanctions on Tehran. Trump's waiver extension will allow Serica to complete its acquisition of BP's stake in three fields in the region - the Rhum, Bruce and Keith fields - the first of which is half owned by Iranian Oil Company, a subsidiary of the national oil company. US sanctions on Tehran, set to come into effect on 4 November, block US firms and citizens from doing business with Iranian companies. Elsewhere, Pinnacle Foods gained 0.84% despite the company's third-quarter sales outlook falling short of expectations. Alphabet closed 0.93% lower following a Wall Street Journal report that Google exposed the private data of thousands of users of the Google+ social network, found out about it and then decided to say nothing. Pyxus International closed 4.15% higher following on from its 59% gain in the previous session. On the data front, the National Federation of Independent Business's small business optimism index fell to 107.9 in September from 108.8 the month before, missing expectations for a reading of 108.3. However, Pantheon Macroeconomics said this was "a trivial dip", leaving the index still very elevated. "We'd be surprised to see further declines in the near-term, given the rapid pace of economic growth and the need to renew the ageing capital stock." "The message is straightforward; labour demand is very strong, but people are becoming very difficult to find, and labour cost pressures are intensifying." | | | | | A sharp, trader-centered broker is an agile trader’s choice So take your time to carefully assess, and make a bold choice for your trading ventures #AskStratton for insights Connect Now *Between 74-89% of CFD traders lose | | | eToro Daily Update 10/10/2018 | | | | Today’s highlights: Global markets mostly lower - Wall Street closes lower after volatile session: 10-year Treasury note yield once again put pressure on US markets, as it reached a 7-year high yesterday. Trading on Wall Street was choppy, as both the S&P and Dow Jones traded within a wide range before closing slightly lower. The Nasdaq closed nearly flat, as several tech companies, such as Apple, Facebook, Amazon and Netflix finished the day higher and kept the index afloat. Warren Buffett’s Berkshire Hathaway closed at an all-time high.
- Crypto market shows slowdown: Cryptocurrencies were mostly lower over the past 24 hours, as 9 of the top 10 crypto coins registered losses. At the time of writing, Bitcoin was down less than 1%, holding above the $6,600 mark. Of the top 10 cryptos, XRP registered the largest losses, declining nearly 3%.
Read More.. | | | Wednesday newspaper round-up: Brexit, HSBC, Barclays, Paddy Power | | | | | Britain’s public finances are among the weakest in the world following the 2008 financial crash, according to a fresh assessment of government assets and liabilities by the International Monetary Fund (IMF). The Washington-based lender said a health check on the wealth of 31 nations found almost £1tn had been wiped off the wealth of the UK’s public sector – equivalent to 50% of GDP – putting it in the second weakest position, with only Portugal in a worse state. - Guardian Theresa May is preparing to bind her cabinet into further compromises to her Brexit blueprint before European leaders meet next week. The prime minister will hold an extended discussion on Brexit at the cabinet meeting on Tuesday, the eve of her trip to Brussels, where she hopes to outline a compromise deal on the Irish border. - The Times Allegations that its American division fraudulently mis-sold toxic mortgage products before the financial crisis have forced HSBC to agree a $765 million settlement. The US Department of Justice had claimed that the bank broke the law by misrepresenting to investors the quality of loans in residential mortgage-backed securities and its procedures for checking these loans. - The Times President Trump renewed his criticism of the Federal Reserve last night, saying that the central bank was raising interest rates “too fast”. Mr Trump said: “I like to see low interest rates. The Fed is doing what it thinks is necessary, but I don’t like what they’re doing because we have inflation really checked and we have a lot of good things happening. I just don’t think it’s necessary to go as fast.” - The Times Consumers should pay a tax on all payments to help foot the bill for compensating victims of fraud, a lobby group for banks has argued. UK Finance chief Stephen Jones told MPs on the powerful Treasury committee today that lenders should not always be on the hook for payouts when criminals trick people into transferring money into their bank accounts. - Telegraph President Trump’s trade war with Beijing could help Britain’s banks to steal a march on their American counterparts in China, according to a senior director at Barclays. Sir Gerry Grimstone, chairman of Barclays’ ringfenced international bank, warned that the acrimonious dispute was part of “something very long term”. He added that “being British is probably a help”, as US companies braced for tighter Chinese market restrictions. - The Times The Irish government has announced plans to double betting duties, which Paddy Power Betfair, the largest operator across the Irish Sea, estimated would increase its annual betting duty bill by £20m. Finance minister Paschal Donohoe said Irish turnover tax will rise from 1pc to 2pc for both retail and online bets from next year. Duties levied on gambling exchanges - where bookmakers match wagers between customers - will increase from 15pc to 25pc. - Telegraph ITV has put its headquarters on London’s South Bank up for sale, scrapping plans to move back in after a now-shelved five-year redevelopment programme. The broadcaster has already vacated the building, which it has inhabited for more than 40 years, and now plans to stay put in what were meant to be temporary offices in Holborn, another area of the capital. - Telegraph The chief executive of Unilever — who was criticised by shareholders for being disengaged during its botched attempt to relocate to the Netherlands — is tax resident in Switzerland. The Anglo-Dutch consumer goods company has denied that the arrangement limits the “number of days” that Paul Polman, 62, can work in the UK. - The Times The boss of mining giant Eurasian Resources Group has defied the Serious Fraud Office by failing to answer a court summons in London. Benedict Sobotka, chief executive of ERG, did not attend the hearing at Westminster Magistrates Court, where he was accused of failing to turn up for questioning at the crime agency earlier in the summer. - Telegraph Companies selling fossil fuels in Britain should face a steadily rising carbon tax to tackle climate change after Brexit, according to the former Labour chancellor Alistair Darling and the Conservative party grandee Michael Howard. In a cross-party campaign to ensure the government sticks to its commitment to cut carbon emissions after Britain leaves the EU, the two politicians said a tax should be introduced as soon as reasonably possible. - Guardian The boss of Shell has said a huge tree-planting project the size of the Amazon rainforest would be needed to meet a tougher global warming target, as he argued more renewable energy alone would not be enough. Ben van Beurden said it would be a major challenge to limit temperature rises to 1.5C, which a landmark report from the UN’s climate science panel has said will be necessary to avoid dangerous warming. He said observers should not mistake headlines on the company’s forays into low-CO2 projects as a sign it was “going soft” on oil and gas. - Guardian The number of teenagers and young people shunning alcohol entirely has almost doubled in a decade, research shows. Researchers said teetotalism was becoming increasingly “mainstream” among younger generations, where drunkenness was deemed less acceptable. - Telegraph The boss of a London-based stockbroker is set to step down weeks after the company reported a 90 per cent drop in first-half profits because of a slump in corporate finance fees and broking commissions. Cenkos said yesterday that Anthony Hotson would relinquish his seat on the City broker’s board at the end of the month and would leave the company at the end of the year, prompting shares in the business to rise by more than 10 per cent.- The Times The UK advertising watchdog has ruled Nissan made misleading claims about how fast its flagship electric car can be recharged, marking the first time a car manufacturer has been censured over charging speeds. An advert by the Japanese carmaker said the new Leaf, which has a longer range than previous models, could largely replenish its battery capacity within an hour. - Guardian The Royal College of Psychiatrists is to review its opposition to the legalisation of cannabis despite its concerns over the risks the drug poses to users’ mental health. It is setting up a panel to consider decriminalisation in the wake of more countries legalising the drug and the government’s decision this summer to make medical cannabis available on prescription. - Telegraph Hundreds of thousands of business surveys are to be scrapped by the Office for National Statistics (ONS) as it switches to VAT data instead. On Thursday, the UK’s data gatherers are set to unveil a broad scheme of modernisation for the body. Among these will be changes to the methods and sources used to measure GDP which aim to cut costs for the organisation and administration for businesses. - Telegraph Britain is on course for a summer of discontent and poll tax-style chaos unless Theresa May scraps plans for a full national rollout of universal credit next year, the former prime minister Gordon Brown is to say. In a ferocious attack on the government’s flagship welfare reform, Brown predicts that a complex application process alongside Treasury spending cuts will plunge a million more children into poverty and increase reliance on food banks. - Guardian | | | | | Learn a powerful trading strategy - LIVE Attend our FREE webinar and learn exactly how to use our Sniper trading Strategy to trade FX, Indices, Commodities and Shares.
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