- The ECB announced the end of QE with plans to half asset purchases starting in September.
- ECB interest rates left unchanged, but hints at "the summer of 2019" for a change. Euro slides.
- Trump plans to impose $50bn in tariffs on China, met with a pledge of retaliation.
- BoJ to keep stimulus unchanged.
- Brent continued declines as Saudi Arabia and Russia hint that production figures could rise.
- Unilevel is "extremely unlikely" to remain in the FTSE after it's planned move to Rotterdam.
- Netflix share price at record high, doubling in value over the last 6 months.
UK, US and Europe: Asian markets were down across the board overnight, as the expected US imposition of $50 billion worth of sanctions on Chinese goods stoked fears of an impending trade war. With the possible breakdown of US trade relations with China, alongside a host of G7 allies as seen earlier in the week, it comes as no surprise that we are seeing risk-off sentiment take hold as we move towards the end of the week. The dollar has gained against a broad basket of currencies, while the Euro has weakened considerably following yesterdays dovish ECB press conference. Meanwhile, the BoJ has finished off a week of major central bank announcements, with the widely expected decision to keep their stimulus unchanged.
Looking ahead, a final eurozone CPI reading has the potential to grab headlines in the morning, with the recent sharp rebound clearly having an influence on ECB thinking. The US session sees a focus on tier two releases such as the Empire state manufacturing survey, industrial production, and the Michigan consumer sentiment number.
South Africa: The rand has renewed weakness which is expected to weigh on locally listed financial and retail counters, whilst perhaps aiding gains on rand hedge industrial counters. Tencent Holdings is up 0.5% in Asia suggestive of a positive start for major holding company Naspers. BHP Billiton has added 0.5% in Australia suggestive of a slightly positive start for diversified resource counters.
Economic calendar - key events and forecast (times in BST)
Source: Daily FX Economic Calendar
Featured video: History of the US Dollar
Corporate News, Upgrades and Downgrades
- Tesco Q1 sales rose 1.8% on a like-for-like basis, and were up 2.3% overall. Like-for-like sales rose 14.3% at the newly-acquired Booker.
- Rolls-Royce said that the job cuts announced yesterday would cost £500 million in redundancies and system investments. It said that it remained well-placed to exceed free cash flow of £1 billion by 2020, with a mid-term target of free cash flow per share to exceed £1.
- Glencore has agreed to settle a dispute with its former partner in the Democratic Republic of Congo, who had been seeking $3 billion in damages for unpaid royalties.
Carrefour upgraded to neutral at Credit Suisse
InterContinental raised to neutral at JPMorgan
SGL upgraded to hold at Kepler Cheuvreux
Umicore upgraded to buy at Berenberg
Bossard downgraded to sell at Research Partners
OHL downgraded to hold at Bankinter Securities
Campari downgraded to neutral at Citi
IAG downgraded to neutral at MainFirst
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