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Stranger Things Have Happened: Netflix Earnings and More – EMEA Brief 18 Jan

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  • Netflix announced subscriber growth of 8.8 million over the past year giving them a total of more than 139 million. Meanwhile, their quarterly revenue was up 27% from the same period in 2017 but the share price is down 3% as they failed to hit analysts’ expectations.
  • Theresa May has rejected calls of Jeremy Corbyn to rule out a no deal Brexit whilst the FTSE yesterday stayed flat.
  • American Indices were up yesterday with the Dow gaining 0.67% despite no resolution to the US government shutdown yet being found. The US delegation’s trip to the World Economic Forum has been cancelled as a result.
  •  Fidelity Investments stated yesterday that Chinese stocks are “very very attractive”. Asian markets were up yesterday with both the Hang Seng and the Nikkei gaining 1.29%.
  • Brent futures are up 1.19% and WTI futures are up 1.33% this comes as the market for heavy oil such as Heavy Louisiana Sweet is seeing tight supply.
  • Palladium is continuing to trade at its all time high as this month has saw a 11% surge in the precious metal on supply concerns. Meanwhile, Gold has remained steady at around $1290
  • Morgan Stanley shares are down over 4% following their release yesterday of 80 cents per share compared to 89 cents EPS expected
  • Afterpay Touch group are up almost 13% after their H1 sales surged.

UK, US and Europe: Markets have eased on promising signs of trade war progress. A report has stated that the US is considering easing Chinese tariffs during their recent negotiations. Germany have also pledged to deepen financial cooperation with China in areas of banking, finance and capital markets. However Germany have also reported that they are considering banning Huawei products, the latest large country to make such a suggestion over security concerns.

South Africa: Global equity market have resumed short term gains as markets find renewed optimism around the progression of trade between China and the US. Oil prices have added more than 1% today following reports that OPEC production had fallen sharply in December 2018. Metal prices are trading relatively flat on the day, while the rand has held onto, although not really extended, its short term strength against the majors. Tencent Holdings is up 1.63% in Asia suggestive of a positive start for major holding company Naspers. BHP Billiton is up 0.73% in Australia suggestive of a positive start for local resource counters.

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

Economic Calendar 18.01 .PNG

Source: Daily FX Economic Calendar

Corporate News, Upgrades and Downgrades

  • Ryanair have reduced profit guidance by 100 million.
  • JP Morgan have downgraded EasyJet to Neutral
  • Phillips are to close their UK factory in 2020 resulting in a loss of 400 jobs
  • Lloyds have secured their Berlin Banking Licence as part of their preparation for Brexit

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