| | | London stocks edged lower in early trade on Monday following heavy losses in Asia, as investors continue to fret over US bond yields. At 0830 BST, the 100 was down 0.2% to 7,307.45, holding above 7,300 but trading at its worst level in almost three weeks, while the pound was off 0.4% against the dollar at 1.3071 and 0.1% lower versus the euro at 1.1371. Losses in London were muted in comparison to the falls seen in Asia, where the Shanghai Composite fell 3% after the People's Bank of China cut banks' reserve requirement ratio by 100 basis points to boost liquidity and lending. Neil Wilson, chief market analyst at Markets.com, said: "As feared, it rather looks as though the China will seek to counter tariffs with easing aimed at not only boosting lending but also devaluing the yuan. Against a Fed tightening cycle, such easing easily looks like the PBOC is actively encouraging a weaker currency. This could prompt a response from Washington that could further unsettle markets, but it does indicate real concerns in Beijing about the impact on the economy of tariffs. "Meanwhile, Washington may already have set the cat among the pigeons to an extent with the clause in Nafta mark two that prevents Canada and Mexico from pursuing trade deals with a non-market economy - i.e. China." Over the weekend the White House said it would seek to include this kind of clause in other deals, a move that would stop the likes of the EU, Japan and the UK from chasing a free trade agreement with China if they also want to court the US. "After months of ratcheting up the pressure on China, this move looks to be aimed at further isolating the country on trade," said Wilson. US bond markets will be closed on Monday for Columbus Day, but equity markets will be open as usual. In UK corporate news, Lancashire Holdings tumbled after saying it expects to report third-quarter net losses following hits to its marine portfolio and exposure to natural disasters including US hurricane Florence, and Asian typhoons Jebi, Mangkhut and Trami. Schroders bucked the trend as it responded to press reports by confirming it is in discussions with Lloyds Banking Group about working together "in parts of the wealth sector". Last week the fund manager was said to be poised to win the £109bn mandate to manage Lloyds' Scottish Widows investment assets. UK Commercial Property REIT gained as it completed the off-market sale of 15 Great Marlborough Street, an office asset in London's Soho, to Royal London Asset Management for £73.2m. Elsewhere, Dechra Pharmaceuticals ticked higher as it announced the acquisition of New Zealand vet supplier Caledonian for NZ$8.7m (£4.4m). Hammerson advanced after agreeing to sell its 50% stake in the Highcross shopping centre in Leicester for £236m, while Acacia Mining rallied as lifted its full-year gold production target following better-than-expected third-quarter output. On the broker note front, IAG was a big faller after being cut to 'neutral' at Citi, while Vodafone was cut to 'hold' at Jefferies, and Tesco was downgraded to 'add' by AlphaValue. Hastings was downgraded to 'reduce' at Investec, while Quiz was downgraded to 'hold' at Peel Hunt. Intu Properties was lifted to 'buy' by Citi, Mediclinic was upgraded to 'buy' by Investec, while Inmarsat was initiated at 'buy' by Bank of America Merrill Lynch. | | | | Top 10 FTSE 100 Risers| Sponsored by Interactive Investor | 
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| | | | | Exclusive Opportunity Disruptive cyber-crime prevention technology that will revolutionise the anti-virus market as we know it! Huge potential gains. Click here to find out more | | | US close: Shares slump as strong jobs report pushes bond yields higher | | | | | US stocks slumped on Friday after a stronger-than-expected US jobs report for September pushed government bond yields higher. By the end of trading, the Dow Jones Industrial Average had fallen 0.68% or 180.43 points to 26,447.05, the S&P 500 was down 0.55% or 16.04 points to 2,885.57, and the Nasdaq Composite by 1.16% or 91.06 points to 7,788.45. In parallel, the CBoE's VIX volatility index rose 4.22% to 14.82. Meanwhile, the yield on the benchmark two-year US Treasury note was two basis higher at 2.88% and that on the 30-year bond by six points to 3.40%. From a sector standpoint, the best performance was to be seen in: Coal (2.25%), Electricity (1.59%) and Utilities (1.51%). The technology-heavy Nasdaq on the other hand continued to be weighed down by news headlines around the alleged tampering of US technology giants' hardware by Chinese intelligence services continued to be reverberate through markets. Non-farm payrolls in the States increased by 134,000 last month, according to the Department of Labor, falling well short of economists' forecasts for a rise of 188,000. But analysts ascribed much of the 'miss' to the impact of hurricane Florence, pointing instead to the large upwards revision of 87,000 for the prior two months combined and to the two tenths of a percentage point drop in the rate of unemployment to 3.7%. Commenting on Friday's jobs data, Ian Shepherdson, the chief economist at Pantheon Macroeconomics, said: "The unemployment rate continues to trend down, and is on course for about 3-1/4% a year from now, barring a miraculous rise in the participation rate. Don’t bet on that; it's still not moving. No-one at the Fed thinks unemployment near 3% is sustainable, especially if the trend is still falling steadily at the time unemployment hits that level. "Accordingly, we remain firmly of the view that the Fed will hike again in December and is on course to raise rates next year by at least the 75bp median dot plot forecast." Separately, the Department of Commerce reported that the US foreign trade deficit widened by 6.4% month-on-month in August to reach -$53.2bn (consensus: -$50.7bn). In the background meanwhile, the President of the Federal Reserve bank of New York, John Williams, said that the recent rise in market interest rates was not a reflection of worries about inflation, but just the typical reaction to a strong economy. In corporate news, Snap shares dipped 0.38% following a report of a leaked memo in which chief executive officer Evan Spiegel told employees that Snapchat is doing better now that it has begun to chase its goals at a "sustainable pace". Elsewhere, Costco Wholesale fell 5.55% after saying late on Thursday that it was assessing its internal control over its financial reporting. | | | eToro Daily Update 08/10/2018 | | | | Today’s highlights: Global markets seen lower - Job data and bond yield weigh on Wall Street: The NFP report released on Friday showed lower job growth than expected. At the same time, 10-year bond yield continued to grow. Both factors impacted markets, resulting in the Dow Jones, S&P 500 and Nasdaq finishing lower. The Nasdaq registered the most losses, closing 1.2% lower, as major components such as Apple, Amazon, Alphabet (Google), Facebookand Netflix all registered losses.
- Crypto market seen mixed: After several crypto coins showed instability over the weekend, the market was mixed over the past 24 hours, as 6 of the top 10 cryptos registered losses. Bitcoin showed little change, trading above the $6,500 mark at the time of writing. Of the top 10 cryptos, Cardano registered the highest gains, rising more than 3%.
- Asia follows Wall Street’s lead: Markets in the East were seen lower this morning, as both the China50 and Hang Seng indices registered losses. Markets in Japan are closed today.
Read More.. | | | Monday newspaper round-up: housing, Brexit, stamp duty, RBS | | | | | The chancellor, Philip Hammond, is considering using this month’s budget to introduce a “good landlord” tax break rewarding investors who sell properties to sitting tenants amid a housing crisis that has left 40% of young adults unable to buy a home. The Treasury is weighing up a new Help to Buy proposal whereby landlords would not have to pay capital gains tax when selling up to tenants who had been living in a property for at least three years. The plan has been drawn up by the right-wing thinktank Onward, which suggests the £1.3bn-a-year cost of the policy could be covered by curtailing other tax perks enjoyed by buy-to-let investors. – Guardian British businesses are the most anxious they have been about Brexit since the 2016 referendum, with more bosses reining in hiring and investment plans, a study has found. The accountancy group Deloitte has warned that worries over the long-term impact of Brexit are mounting. This is pushing down optimism over future prospects as firms fear their trading relations with customers in the European Union could be disrupted next year. - Guardian The head of estate agent Knight Frank has hit out
at plans to charge higher stamp duty on overseas purchases of UK homes, warning the move will hammer the property market. Alistair Elliott, who chairs the partnership, said he was open to measures to tackle the effect of foreign speculators on the market but said “another levy on top of a very high level for our market is not the answer”. - Telegraph Having enjoyed a bumper run in the years following the financial crisis, London’s vast and wealthy commercial property industry came unstuck when Britain voted to leave the European Union two years ago. Office landlords such as Land Securities, Derwent and British Land saw millions wiped off the value of their shares and investor cash flowing into the capital waned amid fears the City would lose its dominance of Europe’s financial sector, leading to an exodus of employers. - Telegraph Brexiteers warned Theresa May last night that she could keep Britain within EU customs arrangements only until 2022 as negotiations with the bloc entered a vital week. The prime minister hopes to unlock talks that have become stuck over the so-called Irish backstop with a commitment to keep all of the UK in the European Union’s present customs arrangements after the transition period ends in December 2020. - The Times Royal Bank of Scotland is considering ditching its corporate name after suffering severe reputational damage from the financial crisis and ten years of painful restructuring, according to the bank’s chairman. Sir Howard Davies told The Times that the RBS name was “under review” as the bank had now resolved most of its historical problems and was shifting its focus to investing in its other brands - Natwest, Coutts and Ulster Bank. - The Times | |
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