• Solid US earnings yesterday support the Asian market and China sees a rebound.
• GBP has slipped to its lowest level in 11 months on Brexit ‘no deal’ fears.
• The British heatwave and World Cup has boosted discretionary consumer spending in July according to Barclaycard.
• Oil gains as US renews sanctions against Iran.
• Gold gains slightly as lower price levels and the key level of $1200 support seen historically induce buying.

Asian overnight: Asian markets were largely in the green overnight, coming off the back of a US session which saw the Dow within touching distance of record highs. Interestingly, Chinese stocks were the main outperformer, with fears over their trade war with the US dissipating for now. The buying is however supported by below average volumes today questioning the sustainability thereof. The one outlier came from Australia, with the ASX 200 in the red despite the RBA deciding to retain their historically low monetary policy stance. Elsewhere, crude prices rose, with the imposition of fresh sanctions on Iran raising rumours that they would seek to close the Strait of Hormuz in retaliation. 

UK, US and Europe: Looking ahead, there are few events of note worth watching out for, with much of the eurozone data already released from Germany earlier this morning. Coming off the back of yesterday’s weak German factory orders number, this morning has seen a greater deterioration in German Industrial production and trade surplus than expected, in a clear response to the breakdown of trade with the US. Elsewhere, look out for the UK Halifax House Price Index (HPI) and Canadian Ivey PMI releases as the only events of interest. The corporate calendar is a little more interesting, with Walt Disney and Snap earnings due out later today.

South Africa:  The dollar has given up some of it recent strength this morning, adding a slight rebound in brent and precious metals as well as emerging market currencies, while base metals trade mixed on the day.  BHP Billiton is trading 1.6% lower in Australia suggestive of a softer start for local diversified resource counters. Tencent Holdings is trading 0.25% higher in Asia, suggestive of a marginally positive start for major holding company Naspers. 

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

Source: Daily FX Economic Calendar

Corporate News, Upgrades and Downgrades

• Standard Life Aberdeen saw a 37% drop in first-half profit, to £185 million, while adjusted pre-tax profit was down 8.3% to £478 million. The firm continued to see outflows, but it still plans to push on with cost saving measures. The dividend was raised 4.3% to 7.3p.
• InterContinental Hotels reported an 8% rise in first-half underlying operating profit, to $398 million, while underlying revenue for the period rose 4% to $875 million. 28 hotels were opened in the year, with a record 7000 new rooms added.
• Rotorksaid that first-half pre-tax profit rose 12% to £54.7 million, while revenue was up 10.4% to £331 million. Management expectations for the year remain unchanged.
• Hargreaves Lansdown reported a 10% rise in pre-tax profit to £292.4 million, for the year, while revenue was up 16% to £447.5 million. A special dividend of 7.8p per share will be paid, taking the overall dividend to 40p, up nearly 40% over the year.
• Nedbank Ltd Headline earnings increased 27,0% to R6 696m, boosted by associate income from ETI's returning to profitability, while our managed operations delivered positive, but slower, earnings growth from a high base. This translated into an increase in diluted headline earnings per share and headline earnings per share of 26,3% to 1 361 cents and 1 387 cents respectively, in line with the 23% to 28% range set out in the trading statement released on 26 July 2018. 

CNH Industrial upgraded to add at AlphaValue
Ferrexpo upgraded to overweight at JPMorgan
Prosafe upgraded to buy at Fearnley
William Hill upgraded to neutral at Goldman
Goldman Sachs maintain neutral rating on Mondi (London) with a target price of 2200p

Ocado downgraded to underweight at Barclays
Siemens Healthineers downgraded to hold at HSBC
Ultra Electronics cut to hold at Kepler Cheuvreux

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