- David Davis resigns from his poll position as Brexit secretary. Sterling feels the pinch.
- Global equity markets rally on US jobs relief, whilst dollar falters.
- Balanced U.S. jobs data suggest Fed can stay gradual on hikes
- Oil inches up whilst gold gains on the weaker dollar.
- NYSE technology chief has jumped ship to join the Winklevoss ‘bitcoin billionaires’ cryptocurrency venture as their first CTO for Gemini.
Asian overnight: Asian markets have seen substantial gains overnight, as we see a continued feedback from Friday’s strong US jobs data and easing fears over the US - China trade war. The US non-farm jobs report alluded to an improving labour market with 213 000 people being added t the payroll last month, where expectation was for 195000 people to have been added. The dollar has softened somewhat lifting commodity prices, in particular that of precious metals.
UK, US and Europe: The overnight resignation of UK Brexit Secretary David Davis had added a focus onto the pound, with the weekend gap higher erased as markets seek to find answers of what this means for negotiations with the EU. British Chambers of Commerce believe forward looking indicators predicting the growth of the economy are not strong enough to warrant a rate rise at the next MPC meeting on August 2nd. A poll conducted by the group reviewed more than 6000 firms from the UK.
The economic calendar looks relatively quiet for the day ahead, and that bullish theme overnight seems likely to carry through into European trade. Look out for appearances from ECB governor Mario Draghi, alongside BoE member Broadbent.
South Africa: The rand has managed to claw back some of its recent losses, as outflows from emerging markets halt for the time being. We are expecting broad-based gains on the JSe initially, with a stronger rand aiding a rebound in local banking and retail counters. BHP Billiton is up 2% in Australia suggestive of a positive start for resource counters. Tencent Holdings is up 2.53% suggestive of a positive start for local holding company Naspers.
Company earnings: Pepsi will report second quarter results tomorrow, whilst fashion house Burberry and America's Delta Airlines will follow on Wednesday and Thursday respectively. We also see big banknames Wells Fargo, JP Morgan Chase and Citigroup finish the week on Friday.
Economic calendar - key events and forecast (times in BST)
Source: Daily FX Economic Calendar
Corporate News, Upgrades and Downgrades
Centamin said that gold production fell 25% in Q2, due to low metal grades at its Egypt mine. Production was expected to be 505,000 to 515,000 ounces for the full year.
Purplebricks has completed the acquisition of Canadian estate agency Duproprio/Comfree, for £29.3 million.
Murray & Roberts Holdings (SA) - Shareholders are referred to the announcement released on SENS today by Aveng regarding a notification received from ATON on Thursday, 5 July 2018, indicating that ATON and its wholly owned subsidiary ATON Austria Holdings GmbH, have in aggregate, acquired an interest in the ordinary shares of Aveng, such that the total interest in the ordinary shares of Aveng now amounts to 25.42% of the total issued ordinary shares of
Beazley upgraded to top pick at RBC
G4S upgraded to top pick at RBC
Meggitt upgraded to buy at Berenberg
TalkTalk upgraded to neutral at JPMorgan
UBS upgrade Barclays Africa from sell to neutral with a target price of 19700c
Nedbank Limited’s (SA) national scale rating was upgraded to ‘zaAA+’ from ‘zaAA’ by S&P
Hargreaves Lansdown cut to underweight at JPMorgan
Virgin Money cut to equal-weight at Barclays
Featured Video from IGTV
Please note: This information has been prpared by IG, a trading name of IG Markets Limited. In addition to the disclaimer below, the material on this page does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. IG accepts no responsibility for any use that may be made of these comments and for any consequences that result. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. Any research provided does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it. It has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Although we are not specifically constrained from dealing ahead of our recommendations we do not seek to take advantage of them before they are provided to our clients. See full non-independent research disclaimer and quarterly summary.