Jump to content

Will the New Year Blues continue? - EMEA Brief 11 Jan


MichaelaIG

1,804 views

  • Yesterday saw further pessimism from corporate giants as the likes of Jaguar Land Rover, Macy's Inc and BlackRock Inc cut profit forecasts.
  • Geely Group halves 9.7% stake in Daimler AG
  • Virgin Atlantic and Stobart Group to buy Flybe for £2.2million after Flybe profit warning saw shares prices tumble in October 2018. A fall from which it hasn't recovered. 
  • Trump announced intention to bypass Congress by declaring a national emergency in order to fund wall. This comes as government shutdown reaches day 20. 
  • S&P 500 rose 0.4% yesterday resulting in first 5 day increase streak since September 2018. The Dow followed suit posting a 5 day increase. 
  • Hitachi shares jump 8% after The Nikkei Asian Review reported that the company would be likely to suspend all work on the UK nuclear plant, though Hitachi have stated that no formal decision has yet been made. 
  • Oil heads for biggest weekly gain in over 2 years, Brent Crude up 8.4% following Saudi Arabia pledge that a producer coalition will maintain market balance. 
  • Yesterday saw Bitcoin return to $3600 mark after a week pushing $4000, will next week see another rally?

Asian overnight: Asian markets are closing out the week in positive fashion, with Chinese, Japanese, and Hong Kong stock markets in the green as continued optimism surrounding US-China trade talks helps to drive hope of a wider recovery. Trump’s claim that the US is having ‘tremendous success’ in trade talks with the Chinese has raised hopes of a breakthrough within the 90-day timeframe set out by Trump and Xi Jinping. On the data front, Japanese household spending fell further into negative territory (-0.6% from -0.3%), while Australian retail sales ticked marginally higher (0.4% from 0.3%).

UK, US and Europe: Looking ahead, the European session looks set to be dominated by the UK economy, with the November GDP reading, manufacturing production, industrial production, and December NIESR GDP figure all released simultaneously. Meanwhile, for the US session we have the US CPI inflation reading to look out for as a source of market volatility.

Economic calendar - key events and forecast (times in GMT)

Capture.PNG

9.30am – UK GDP & trade balance (November): growth to be 0.3% over the three months to the end of November, while trade deficit to narrow to £2.2 billion from £3.3 billion. Market to watch: GBP crosses

1.30pm – US CPI (December): prices expected to rise 2.2% YoY, in line with last month, and 0.2% MoM, up from 0.2%, while core CPI rises 2.2% YoY and 0.2% MoM. Markets to watch: US indices, USD crosses

Source: Daily FX Economic Calendar

 

Corporate News, Upgrades and Downgrades

  • Flybe has agreed to be taken over for £2.2 million by a joint venture of Stobart Group, Virgin Atlantic and several investment funds. 
  • Grafton Group expects earnings to be slightly ahead of expectations, as revenue rose 8.7% for 2018, to £2.95 billion. 
  • Moss Bros expects to report an annual loss, after sales fell 1.1% like-for-like for the 23 weeks to 5 January. An annual loss of £0.6 million is expected for the full year.  

Cairn Energy upgraded to outperform at BMO
Hunting upgraded to overweight at JPMorgan
Saipem upgraded to overweight at JPMorgan
Suedzucker upgraded to neutral at Goldman

Eurobank downgraded to underperform at KBW
Orion downgraded to underperform at Jefferies
Raiffeisen downgraded to neutral at JPMorgan
Telia downgraded to sell at SocGen

IGTV featured video

Information has been prepared 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.

0 Comments


Recommended Comments

There are no comments to display.

Create an account or sign in to comment

You need to be a member in order to leave a comment

Create an account

Sign up for a new account in our community. It's easy!

Register a new account

Sign in

Already have an account? Sign in here.

Sign In Now
×
×
  • Create New...
us