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[MongiIG]

Market data to trade on Friday: US bank earnings; China CPI

After the strong inflation data in the US, we go into the Chinese CPI data already seeing USD/CNH well bid. If there’s any chance that Chinese CPI is weak, IGTV’s Jeremy Naylor expects the long USD/CNH to keep going.

Jeremy also looks at US banks, JP Morgan, Wells Fargo and Citigroup, which all trade all-sessions on the IG platform.

 

 

 

 

 

 

[MongiIG]

For more up to date news on how markets will open, the latest earnings and economic news, watch IGTV live in the platform at 07:30am UK.

Today’s coverage:

 

Indices: Global markets rally despite stronger US CPI data. Europe expected to lift at the start

FX: USD pummels all other currencies, before retrenching - USDJPY briefly tipped to 32yr high. GBP bucks the trend as Kwartang budget u-turn expected

Equities: US bank earnings the focus. JPM WFC C MS. NFLX Looking at cut price $6.99 plan for some countries to bring subscribers back. TWTR court docs show Federal authorities are investigating Musk TWTR takeover deal

Commods: Gold little moved. Oil 2^nd day in a row of gains  

 

 

 

[MongiIG]

Early Morning Call: thousands of jobs under threat at Royal Mail

Global markets rally despite stronger US CPI data, Europe expected to lift at the start. US bank earnings the focus today: JPMorgan, Wells Fargo, Citibank and Morgan Stanley reporting.

 

 Jeremy Naylor | Writer, London | Publication date: Friday 14 October 2022

Indices overview

Equity markets in Asia-Pacific region rallied overnight, following Wall Street’s performance yesterday.

US indices initially dropped at the release of the US inflation report but rallied soon after. After the higher-than-expected inflation data published yesterday, the US Federal Reserve (Fed) is fully expected to deliver another 75-basis point (bps) hike in three weeks time when its members meet again.

Consumer Price Index (CPI) rose by 8.2% in September year-on-year (YoY), down from the 8.3% recorded last month, but higher than what economists had anticipated. Core CPI rose by 6.6% YoY, after 6.3% in August, and higher that the 6.5% expected.

The reaction to these numbers was instantaneous. Fed swaps now fully price in a 75-bps hike in November and point to a peak at 4.85% in March 2023. Bond yields rose, and USD/JPY broke that August 1998 historical resistance to set a new 32-year high.

In China, consumer prices in September rose at their fastest pace since April 2020, driven largely by food costs. CPI increased by 2.8% in September last year as food price inflation accelerated to 8.8% YoY, from a 6.1% gain in August.

Underlying inflation remained much more modest, however, with core inflation, which excludes volatile food and energy prices, at 0.6% versus 0.8% in August. The producer price index (PPI) grew at the slowest pace since January 2021, rising 0.9% year-on-year from 2.3% growth a month earlier.

Sterling

Sterling is up, at a one-week high against the dollar, a one-month high against the euro, as currency traders expect a UK government u-turn on it fiscal plans.

UK Chancellor of the Exchequer, Kwasi Kwarteng, has dramatically cut short his visit to the International Monetary Fund (IMF), flying home early from Washington in response to the mounting political crisis over his tax-cutting budget.

Royal Mail job cuts

Royal Mail strike uncertainty means that the Board is unable to give a clear outlook for the full year. Royal Mail could cut as many as 5,000 to 6,000 jobs by the end of August next year.

Parent company, International Distributions Services said this morning it "will be starting the process of consulting on rightsizing the business in response to the impact of industrial action, delays in delivering agreed productivity improvements and lower parcel volumes".

Royal Mail expect a full-year adjusted operating loss of around £350 million.

US earnings

The US earnings season well and truly gets underway today with releases from five major banks that could set the tone for equity markets for the coming weeks.

With growing fears of a global recession, 'cautiousness' is a word that could repeatedly appear in statements. As far as the banking sector is concerned, demand for loans keeps growing, but so do concerns about potential loan losses.

Earlier this week, Bloomberg predicted that the six largest US banks will set aside another $4.5 billion in loan-loss reserves during the third quarter (Q3).

JPMorgan Chase revenues are expected to increase by 5.4% YoY to just over $32bn, but analysts see a 22% drop in earnings to $2.91 per share. Three weeks ago, JPMorgan's CFO warned the markets that investment banking revenue would be down by 45 to 50% in Q3.

Last year, strong demand for IPOs and other deals pushed investment banking revenue up to $3.3bn.

Wells Fargo , the third largest bank by market capitalisation, is expected to post earnings of $1.10 per share, that's a 17% decline according to Refinitiv. Revenue is expected to fall by about 1% to $18.75bn.

Wells Fargo, also the biggest mortgage lender in the country, has to deal with higher interest rates and slowing demand for mortgages. The bank has previously said it was planning to reduce its exposure to the US housing markets.

As for Morgan Stanley, the one major US bank that does not trade all-sessions on the IG platform, analysts anticipate earnings of $1.52 per share, and revenue to reach $13.23bn.

On top of the troubles that the banking sector is facing, Morgan Stanley may have added more on its plate by agreeing to put up $13bn for Elon Musk's buyout of Twitter , that could translate to more writedowns.

Citigroup is seen posting a 32% decline in earnings, down to $1.49 per share, on revenue of $18.38bn.

Outside the banking sector, UnitedHealth, the largest US health insurer, is expected to post earnings of $5.43 per share on revenue of $80.52bn. If you are looking for an outperformer, this is one of them. Over the past 12 months the stock has gained some 28%, while the S&P 500 has shed 18%.

Commodities

US crude stocks rose by nearly 10 million barrels last week according to the EIA after another big release of 7.7 million barrels from strategic petroleum reserves, matching Wednesday's API data.

Gasoline stocks rose by two million barrels, distillate fell by 4.85 million barrels.

Traders await Baker Hughes data tonight. Last Friday, Baker Hughes total rig count fell by three to 762. The number of oil rigs in operation decreased by two to 602, while the operational gas rig fell by one to 160.

 

 

This is here for you to catch up but if you have any ideas on markets or events you want us to relay to the TV team we’re more than happy to.

[MongiIG]

Charting the Markets: 14 October

FTSE 100, DAX 40 and S&P 500 stage dramatic U-turn. EUR/USD, GBP/USD, and AUD/USD rebound unlikely to last. And gold and oil recover, but coffee goes off the boil.

 

 

This is here for you to catch up but if you have any ideas on markets or events you want us to relay to the TV team we’re more than happy to.

[MongiIG]

Early Morning Call: sterling gains as market awaits Chancellor's new fiscal measures

Sterling has risen against the dollar, euro and yen this morning following the UK government's second fiscal u-turn.

 

 

 Joshua Mahony | Senior Market Analyst, London | Publication date: Monday 17 October 2022 

Equity markets

Equity markets start the week in negative territory.

In the Asia-Pacific region, Japan’s Nikkei 225 ended the session 1.16% lower, Australia S&P/ASX 200 fell 1.40%.

In Europe, the main indices started the session around 0.5% lower.

Currencies

On the currency market, sterling rose against the dollar, the euro and the yen this morning following the nUK government's second fiscal u-turn announced on Friday.

The yen remains weak, near 32-year lows against the dollar. Currency traders are waiting for signs of another Bank of Japan (BoJ) intervention to support the Japanese currency.

US earnings

Last Friday, four major US banks opened this quarter's earnings season. If some of them beat estimates, they all reported a fall in profits as investment banking was hit hard.

At lunch time it will be Bank of America's (BofA) turn to report its earnings for the third quarter (Q3). Analysts expect on average earnings of 77 cents per share. That is to be compared with earnings per share (EPS) of 85 cents in Q3 2021. Revenue is expected to rise by 3.3% of $23.53 billion.

Investors are particularly waiting for details on the bank's investment banking division. Shares of Bank of America, an all-session stock on the IG platform, have fallen about 31% over the past 12 months.

Also note that the last of the US big banks, Goldman Sachs , is scheduled to report tomorrow. Analysts anticipate earnings of $7.80 per share on revenue of $11.39bn. According to the Wall Street Journal, the bank plans to combine its investment banking and trading divisions, and merge asset and wealth management.

Outside the banking sector, the US earnings season is gathering pace this week. Tomorrow after the US closing bell Netflix reports its numbers. Besides expecting earnings of $2.18 per share and revenue of $7.8bn, analysts perhaps more importantly await subscriber figures. Last quarter the market was pleasantly surprised when Netflix revealed a loss of 970,000 subscribers, lower than the two million forecast.

Attention will also be given to the group's guidance on its advertising strategy. Last Thursday, Netflix announced a new ad-supported subscription plan of $6.99 per month. The plan will be available in 12 countries including the UK, US, Canada, Mexico and Australia. Note for comparison that Disney+ charges $7.99 at its budget end with ads.

On Wednesday, also after the bell, Tesla is due to publish record revenues on the back of record high deliveries. The street expects the electric car maker to post earnings of $1.04 per share, and a 62% increase in revenue year-on-year (YoY) to $22.65bn.

Q3 saw an increase in production at Tesla's plants in Texas and Berlin, and Covid restrictions that impaired production at its Shanghai plant have been lifted. Apart from revenue, this should also help margins to recover after the 500-basis point dip to 27.9% encountered in the second quarter, although higher material cost could partly pare gains.

Other US earnings expected throughout the week include Johnson & Johnson on Tuesday; IBM, Procter & Gamble and Alcoa on Wednesday; American Airlines, Dow and Philip Morris on Thursday; and American Express, Schlumberger and Verizon on Friday.

Commodities

Oil prices have shown modest gains this morning.

Last Friday, Baker Hughes total rig count rose by seven to 769. The number of oil rigs in operation increased by eight to 610, while the number of operational gas rigs fell by one to 159.

 

 

This is here for you to catch up but if you have any ideas on markets or events you want us to relay to the TV team we’re more than happy to.

[MongiIG]

Charting the Markets: 17 October

FTSE 100, DAX 40 and S&P 500 begin week on a positive footing. EUR/GBP, GBP/USD and EUR/USD await new UK chancellor’s statement. And gold, Brent crude, and lumber likely to weaken once again.

 

This is here for you to catch up but if you have any ideas on markets or events you want us to relay to the TV team we’re more than happy to.

[MongiIG]

Market data to trade on Tuesday: US tech earnings; China GDP

A raft of Chinese data brings potential volatility for global markets, with GDP and industrial production keenly watched given recent signs of an economic slowdown.

With the Reserve Bank of Australia (RBA) minutes also released overnight, AUD/USD looks a key market to watch.

Josh also looks at US earnings from the likes of Goldman Sachs, Tesla, and Netflix, which trade all-sessions on the IG platform.

 

 

 

 

 

 

[MongiIG]

For more up to date news on how markets will open, the latest earnings and economic news, watch IGTV live in the platform at 07:30am UK.

Today’s coverage:

 

Indices: Europe to open up after global mkts climbed  

FX: USD 2^nd day of losses although USDJPY nudges new 24-yr high. Watching EURUSD ahead of German ZEW expected to fall to 2008 lows. GBPUSD 2wk high after fiscal retrenchment. AUDNZD breaks support after strong Kiwi CPI

Equities: Earnings – BWY GS JNJ NFLX. Swiss Re now expecting 3Q loss on $1.3bln hit from Hurricane Ian

Commods: Gold up for a second day. Brent keeps above $90 but only just

 

 

 

[MongiIG]

Early Morning Call: BoE to delay start of quantitative tightening until markets calm

The FTSE 100 closed higher after the new Chancellor of the Exchequer, Jeremy Hunt, scrapped almost all of the mini budget. The pound rose on the news to near two-week highs against the dollar.

 Jeremy Naylor | Writer, London | Publication date: Tuesday 18 October 2022 

Equity market overview

APAC equity markets closed mostly higher, following yesterday’s rebound on the US stock market.

In Europe, indices show gains this morning, building on Monday’s positive session. In the UK, the FTSE 100 closed higher after the new Chancellor of the Exchequer, Jeremy Hunt, scrapped almost all of the mini budget. The pound rose on the news to near two-week highs against the dollar.

According to the FT, the Bank of England (BoE) is set to delay the start of its quantitative tightening until markets calm.

Macro overview

A couple of weeks ago the Reserve bank of Australia (RBA) decided to raise its interest rate by 'only' 25 basis points (bps) to 2.6%, when consensus was going for 50 basis points. According to its minutes published earlier this morning, the RBA said that inflation in the country was too high, and that a further increase in prices is expected over the months ahead.

The RBA sees 2022 consumer price inflation (CPI) around 7.75%, a little above 4% in 2023, and around 3% in 2024.

Besides the minutes, several Australian bankers shared their views is the last few hours. RBA assistant governor, Luci Ellis, said Australia's neutral interest rate is at least 2.5% but emphasised the neutral rate was a moving target and hard to determine at any stage of time. RBA deputy governor, Michele Bullock, expects to raise interest rates further over the coming months.

New Zealand's consumer inflation beat expectations in the third quarter (Q3). Consumer price index rose 2.2% quarter-on-quarter (QoQ), following a 1.7% increase in the second quarter. It beat expectations of a 1.6% rise, prompting analysts to bet on a more aggressive central bank rate hike next month.

In Germany, economists see ZEW economic sentiment for October falling to -66, lower that the 2008 financial crisis lows.

In the US, industrial production is forecast to rise by 0.1% in September monht-on-month (MoM), while NAHB housing market index is expected to fall for a tenth straight month to 44 in October.

Rio Tinto expects annual iron ore shipments at the lower end of its guidance. This morning the miner said iron ore deliveries fell in the third quarter as global demand weakens, particularly in top metals consumer, China.

The world's biggest iron ore producer shipped 82.9 million tonnes (mt) of the steel-making commodity compared with 83.4 mt a year earlier. It now expects annual iron ore shipments at the low end of its forecast range of 320 million tonnes to 335 million tonnes.

Yesterday, Vale reported third quarter iron ore production up slightly from the previous year to 89.7 million tonnes.

BHP Group is expected to report its first quarter production results tomorrow.

Earnings

Bellway posted a 13.3% increase in revenue for the full-year (FY). Pretax profit rose 22.5% to £650.4 million. The group says it started the new financial year with a strong forward order book. However, it notes demand has moderated since the beginning of August and anticipates an average selling price around £300 000 in FY2023, down from 314,399 in FY 2022. House builders are increasingly under scrutiny, as mortgage rates are rising and house prices are predicted to fall.

Last week, its competitor Barratt Developments reported a fall in private reservations.

In the US, Goldman Sachs is scheduled to report Q3 earnings before the market opens. Analysts anticipate earnings of $7.80 per share, roughly 50% lower than the same quarter a year ago. Revenue is expected to reach $11.39 billion. The bank, according to the Wall Street Journal yesterday, plans to combine its investment banking and trading divisions, and merge asset and wealth management.

Also expected before market open is Johnson & Johnson . Analysts expect earnings of $2.52 per share. Revenue is seen little changed at $24.46bn. Operating margins are expected to face headwinds from inflationary pressure and increased marketing expenses.

Tonight after the close of the US markets, Netflix is expected to post earnings of $2.18 per share and $7.85nn revenue. Maybe more importantly, analysts await the latest subscriber figures.

Last quarter Netflix revealed a 970 000 subscriber loss, lower than the two million anticipated. Last Thursday, Netflix announced a new ad-supported subscription plan of $6.99 per month. For comparison, Disney+ charges $7.99 at its budget end with ads.

 

 

This is here for you to catch up but if you have any ideas on markets or events you want us to relay to the TV team we’re more than happy to.

[MongiIG]

Charting the Markets: 18 October

FTSE, DAX and Dow rebound, but bears look likely to return before long. EUR/USD and USD/JPY push higher while GBP/USD recovery stalls. And Brent crude oil, gold and US natural gas prices remain under pressure.

 

 

 

This is here for you to catch up but if you have any ideas on markets or events you want us to relay to the TV team we’re more than happy to.

[MongiIG]

Market data to trade on Wednesday: NFLX; TSLA; PNG; ASC

Earnings are ramping up and traders are now able to look ahead to some big tech names, of which the biggest are all-sessions on the IG platform, such as Tesla (TSLA) and Netflix (NFLX).

Consumer goods company, Procter & Gamble (PNG) is also on the list, while in the UK it’s ASOS (ASC). On the economic agenda there’s UK consumer prices.

 

 

 

 

 

[MongiIG]

For more up to date news on how markets will open, the latest earnings and economic news, watch IGTV live in the platform at 07:30am UK.

Today’s coverage:

 

Indices: Europe expected to rise again at the start. All global mkts up apart from China & HK

Equities: Earnings: ASC ASML NESN JET TSLA IBM PNG AA. NFLX up 11% last night after Q3

FX: Mkts broadly little moved, although another new 32yr high for USDJPY. Watching GBP ahead of UK CPI RPI PPI inflation data at 7am

Commods: Gold testing Fib support again at $1,642. Oil down again Brent below $90

 

 

 

[MongiIG]

Early Morning Call: UK core CPI reaches new high at 6.5%

The rise in UK consumer price index accelerated by 10.1% in September YoY, matching the July 2022 high, and beating expectations of 10%. Core CPI increased by 6.5%, also beating consensus.

 

 

 Jeremy Naylor | Writer, London | Publication date: Wednesday 19 October 2022 

Equity market overview

The rebound in US equity markets continued yesterday, supported by strong earnings reports. It was, however a mixed session overnight in the APAC region. In Europe, indices are hesitant at the start of the day.

The UK consumer price index (CPI) rise accelerated by 10.1% in September year-on-year (YoY), matching the July 2022 high, and beating expectations of 10%. Core CPI increased by 6.5%, also beating consensus.

Central Banks

The Bank of England (BoE) says the first sale of gilts held in its asset purchase facility would take place on November 1 in light of the government's plan to make a fiscal announcement on the previously planned date of the end of October.

According to a Reuters poll, the European Central Bank (ECB) will go for another 75-basis point increase when it meets on October 27.

Earnings

BHP Group's quarterly iron ore output rose during its fiscal first quarter (Q1). The group produced 72.1 million tonnes of iron ore in Q1, up 2%, despite an 18% fall in spot prices over the quarter. BHP left its annual production and cost guidance unchanged.

ASOS' pretax profit fell 89% to £22 million. Gross margins fell 180 basis points to 43.6%. In its statement, the clothing retailer talked of a weakening consumer environment.

ASML Holding posted what looks like a positive thrid quarter (Q3) report. Net sales came at €5.8 billion , higher than the €5.5bn expected by the market. Gross margins reached 51.8% in the period, 150p basis points higher than consensus. The semiconductor manufacturing equipment maker sees fourth quarter (Q4) sales between €6.1bn and €6.5bn, compared to analysts Q4 expectations of €6.13bn.

JustEatTakeaway.com said in its trading statement this morning it made an underlying profit in the third quarter sooner than previously forecast, after cutting expenses on delivery costs and operations.

In the US, Netflix shares rose as much as 14% in extended hours, after the group published better-than-expected earnings and net subscriber additions. Netflix posted earnings of $3.10 per share, almost $1 more than expectations. Revenue reached $7.93, also beating forecasts. The group said it added 2.41 million subscribers in the quarter. The market had anticipated a one million subscriber increase.

Netflix now has a total of 223.1 million subscribers around the world. In terms of subscribers, Netflix came up with an upbeat forecast. The streaming giant expects to pick up 4.5 million customers in the fourth quarter, higher than the 4.2 million forecast by Wall Street.

Netflix considers itself in a much better position than its competitors and estimates it will end 2022 with combined operating losses of "well over $10 billion," compared with Netflix's annual operating profit of $5 billion to $6 billion. Netflix is about to launch a $7-per-month streaming plan with advertising to attract cost-conscious customers.

Netflix did not disclose how many new subscribers, or how much revenue, it expects from the new plan and warned it will no longer provide quarterly guidance for new customers. The company will continue to issue forecasts for revenue, operating income and other categories.

Before market opens, Procter & Gamble is expected to post earnings of $1.56 per share on revenue of $20.37bn, unchanged on the same quarter a year ago, as consumers cut back spending.

After the bell, Tesla is due to publish record revenues on the back of record high deliveries. The street expects the electric car maker to post earnings of $1.04 per share, and a 62% increase in revenue YoY to $22.65bn.

Q3 saw an increase in production at Tesla's plants in Texas and Berlin, and Covid restrictions that impaired production at its Shanghai plant have been lifted.

Apart from revenue, this should also help margins recover after the 500-basis point dip to 27.9% encountered in Q2, although higher material costs could partly pare gains.

IBM is expected to deliver a year-over-year decline in earnings on higher revenues when it reports results for the third quarter. Analysts expect IBM to post earnings of $1.79 per share, and revenue of $13.54bn. Investors will look out for commentary on client spending amid a macroeconomic slowdown.

Also after the bell, Alcoa is expected to post earnings of 19 cents per share, a sharp decline compared to the $2.67 recorded three months ago, or even the $2.05 from Q3 2021. Revenue is expected to fall by about 5% YoY to just over $3.01bn.

Since the beginning of the war in Ukraine aluminium prices have fallen, from over $4,000 early March to $2,081 at the end of September. Besides this, production has risen in China, which is likely to put further pressure on prices. Add to that higher input and energy costs, and Alcoa finds itself in a difficult situation, as far as its profitability is concerned.

Commodities

API inventories show a fall in stocks across the board. Crude oil inventories fell by 1.27 million barrels, as the Department of Energy released 3.6 million barrels from its strategic petroleum reserve, half of what it released the previous week.

Gasoline stocks fell by 2.17 million barrels, and distillate inventories fell by just over one million barrels.

 

 

This is here for you to catch up but if you have any ideas on markets or events you want us to relay to the TV team we’re more than happy to.

[MongiIG]

Charting the Markets: 19 October

FTSE 100, DAX 40 and Dow are taking a breather. USD/JPY trades in fresh 32-year highs while EUR/USD and EUR/GBP consolidate. And gold, silver and oil come under pressure.

 

This is here for you to catch up but if you have any ideas on markets or events you want us to relay to the TV team we’re more than happy to.

[MongiIG]

Market data to trade on Thursday: China trade; US earnings

US earnings continue apace with all-sessions stocks to watch, including American Airlines, AT&T, and Snap. In the UK its Dunelm, Travis Perkins, and National Express. Economic data to watch includes USD/CNH around China trade.

 

 

 

 

 

[MongiIG]

For more up to date news on how markets will open, the latest earnings and economic news, watch IGTV live in the platform at 07:30am UK.

Today’s coverage:

 

Indices: Global markets down again, Europe expected to open lower – inflation concerns return

FX: Mkts pretty much holding the USD gains yesterday. Another 32yr high for USDJPY, close to ¥150 despite more BoJ bond buying in the pipe. Today USDCNH down from 14yr highs - China left rates on hold   

Equities: Earnings today - DNLM TPK AAL PM. All sessions reaction last night to Q3 earnings at TSLA: down 7.2%, IBM: up 1.9%, AA: down 14%.  

Commods: Gold near 30-mth lows. Oil 2^nd day in a row of gains. Lumber up at resistance after 28% rise over 3 weeks

 

 

 

[MongiIG]

Early Morning Call: USD on the way up again as inflation worries reappear

Markets pretty much holding yesterday's USD gains. Another 32-year high for USD/JPY, close to ¥150, despite more BoJ bond-buying in the pipeline.

 

 Jeremy Naylor | Writer, London | Publication date: Thursday 20 October 2022 

Equity market overview

Equity markets have turned lower as inflation worries take the upper hand.

Yesterday, European and US stocks edged lower as UK consumer price index (CPI) rose back to double figures and companies like Nestle and Procter & Gamble highlighted the impact of inflation on their earnings reports.

Overnight, APAC stocks fell and indices in Europe struggle to find a direction this morning.

Macro overview

In China, the People's Bank of China (PBoC) kept its key lending rates unchanged for a second straight month at its October fixing. The one-year loan prime rate, the reference for corporate and household loans, was kept at 3.65%; the five-year rate, the reference for mortgages, remained at 4.3%.

Japan posted its 14th straight month of trade deficit, the longest streak since 2015. Japan's imports grew more than 40% for a fifth consecutive month in September to hit ¥2 trillion, the largest value on record. Exports also rose by a softer 28.9%. During the fiscal first half to end-September, Japan accumulated a record trade deficit of ¥11tn.

The Bank of Japan (BoJ) said overnight it would hold emergency bond-buying operations, offering to buy some ¥100 billion, about $667 million, in government debt.

For the past few months, the yen has dropped against the dollar, hit by the widening difference between US and Japanese interest rates. It now trades just below the highly psychological ¥150 level.

In Australia, the unemployment rate remained at 3.5% in September, matching market estimates. Data show a disappointingly small rise in net employment, up 900 in September, short of market forecasts of 25,000 and well down on August's jump of 36,300.

In the US, initial jobless claims are expected at 1.30pm. Economists anticipated 230,000 new claimants. A couple of indicators are also scheduled this afternoon: Philadelphia Fed manufacturing index and Existing home sales.

Corporate overview

On the corporate front, Travis Perkins says it had a resilient third quarter (Q3) with underlying sales growth of 7.4%. The supplier of building materials sees a full-year (FY) operating profit around the middle of the current range of market expectations - £304-340 million.

Dunelm posted a drop in its first quarter (Q1) sales, as consumers struggle with accelerating cost of living. The company reported sales of £357 million, down 8% from the previous year. FY23 guidance remains unchanged despite the challenging macroeconomic environment.

In the US, Tesla posted profits broadly in line with consensus. Earnings came at $1.05 per share, compared to expectations of $10.3. Revenue however missed expectations by about $1bn, coming at $21.45bn.

Even though CEO, Elon Musk talked of excellent demand for the fourth quarter, he warned yesterday that the company was to miss its vehicle delivery targets this year, as logistic challenges persist. Raw material cost inflation impacted the group's profitability. Third quarter automotive gross margin was 27.9%, down from 30.5% a year ago and missing analysts' estimates. Foreign exchange also had a negative impact of $250 million on its earnings.

Alcoa shares tanked in extended hours, after the aluminium producer posted a surprise loss of 33 cents per share. Analysts expected earnings of 19 cents. Revenue also missed expectations at $2.85bn. Just over $3bn was expected. Alcoa was hit by the combination of lower aluminium prices and higher energy costs.

IBM posted better-than expected revenue, which it said was poised to exceed full-year growth targets. Revenue came in at $14.11bn, compared with $13.54 billion expected by analysts. On an adjusted basis, IBM recorded earnings of $1.81 per share, marginally beating estimates of $1.79. Cloud revenue rose 11% to $5.2 billion in the quarter. IBM now expects the company's annual sales to increase more than its previous estimate of mid-single-digit growth at constant currency.

American Airlines is expected to post earnings of 47 cents per share in Q3. Revenue should remain broadly unchanged compared to Q2, at $13.31bn. Last quarter, revenue jumped 80% year-on-year (YoY), driven by a strong recovery in passenger sales.

Also expected today, quarterly earnings from Dow, Philip Morris and AT&T.

Commodities

Oil prices have risen for a second day.

Yesterday, EIA crude oil inventories showed a 1.7 million barrel decline last week. Gasoline stocks fell by 100,000 barrels, while distillate stocks rose, also by 100,000 barrels.

Gold rose modestly this morning, but the downward trend remains. The precious metal is getting closer to the two-and-half year low set last month.

 

 

This is here for you to catch up but if you have any ideas on markets or events you want us to relay to the TV team we’re more than happy to.

[MongiIG]

Charting the Markets: 20 October

Indices struggling as inflation fears return. EUR/USD and GBP/USD slip on inflation woes while EUR/GBP range trades. And gold falls further, while Brent crude and lumber start to regain lost ground.

 

 

 

 

 

This is here for you to catch up but if you have any ideas on markets or events you want us to relay to the TV team we’re more than happy to.

[MongiIG]

Market data to trade on Friday: UK consumer confidence; US earnings

UK consumer confidence data comes in overnight and the risks could well be on the downside. For this we’re looking at EUR/GBP. Then its earnings from LSE Group, Amex, Verizon, and Schlumberger.

 

 

 

[MongiIG]

For more up to date news on how markets will open, the latest earnings and economic news, watch IGTV live in the platform at 07:30am UK.

Today’s coverage:

 

Indices: Europe to open down but still up on the week.

Equities: Earnings – LSE IHG AMEX VZ SLB. SNAP down 27.9% to covid lows on poor outlook. Watch ADS after it warned about a build-up of stock  

FX: USDJPY up for 13^th session in a row, despite highest CPI in Japan in 8yrs. GBP has lost all of its post-Truss resignation bounce

Commods:  Gold on a second week of declines. Oil up for a 3^rd day, Brent remaining above £90. Lumber closes above prior resistance. NY Cotton 16mth low

 

 

 

[MongiIG]

GBP on the back foot, weighed down by political uncertainties and gloomy consumer data

Pound sterling has lost all of its post-Truss resignation bounce.

 Jeremy Naylor | Writer, London | Publication date: Friday 21 October 2022

Equity market overview

Equity markets remain depressed, as investors are grappling with the prospect of rising interest rates to combat inflation.

Overnight APAC indices were mostly lower, following the lead of yesterday’s session in the US. In Japan, the consumer price index (CPI) rose by 3% in September year-on-year (YoY), as expected. Core consumer prices also increased by 3%, the most since September 2014, in line with forecasts, and above the Bank of Japan's (BoJ) 2% target for the sixth month in a row.

Despite this rise in Japanese CPI, the Bank of Japan has been in the bond market for a second consecutive day. This highlights the pressure that bonds are under, but also that the BoJ isn't about to give up on yield curve control.

In Europe, equity markets opened the session lower. In the UK, Gfk consumer confidence unexpectedly rose to -47 in October but remains close to September's record low of -49. Economists had expected the index to worsen to -52.

Joe Staton, client strategy director at GfK, said that all core measures remain severely depressed by historical standards. Inflation remains to be the top concern for consumers. Earlier this week, headline inflation rose back to double figures. Political and economic instability also weighed on sentiment.

UK retail sales missed expectations, falling by 1.4% month-on-month (MoM). Economists had expected a 0.5% fall. Year-on-year, retail sales dropped 6.9%.

This afternoon at 3pm, eurozone consumer confidence flash is expected to fall to -30 in October, from -28.8 the previous month, which was already the lowest reading since 1985.

Earnings

Elsewhere on the equity market, LSE group reported strong growth across all divisions. Total income excluding recoveries was up 16.2% on a reported basis, to £1.9 billion. The group says it is well positioned for further growth.

There were also reports from InterContinental Hotels Group, Deliveroo and Wickes.

Yesterday after European market close, Adidas warned that unsold goods are piling up as consumer demand weakens across China and western markets, prompting a fresh profit warning. It now expects an operating margin of 4% this fiscal year, down from a prior forecast of 7%. Its full-year (FY) revenues will grow at a mid-single-digit rather than mid- to high-single-digit rate.

L'Oréal said third quarter (Q3) sales grew 9.1% on a like-for-like basis, better than the 8.3% expected to €9.58 billion. Sales in the North Asia region, which includes China, rose 0.3 per cent in the third quarter to €2.41 billion, while all other regions saw double-digit increases on a like-for-like basis.

French luxury group Kering said sales in the third quarter increased by 14% to €5.14bn, better than an analyst consensus of a 12% rise. Sales at its Gucci unit, which accounts for the bulk of profits of the group, rose by 9%, below a consensus forecast for 11% growth.

In the US, Snap shares plunged 27% yesterday in extended hours despite beating expectations on both the top and bottom lines. The disappointment came as the group forecasted no revenue growth for the current quarter, a holiday quarter, typically the busiest quarter of the year. Wall Street had forecast a growth of 7%.

In a letter to investors, Snap said inflation caused some advertisers to cut their marketing budgets. "We expect that the operating environment will continue to be challenging in the months ahead," the company said. Earnings themselves weren't that bad. Adjusted earnings per share (EPS) came at 8 cents, beating expectations of breakeven. Revenue rose 6% to $1.13 billion.

Daily active users on Snapchat rose 19% year-over-year to 363 million, and Snap said it expects Snapchat daily active users to grow to 375 million in the current quarter. But that had little effect on a guidance that not only wiped $4bn off Snap market capitalisation, but also took down shares of other companies that sell digital advertising. Meta Platforms fell over 4% and Alphabet dropped 2.7%.

Twitter employees have been shaken up yesterday by a report from the Washington Post saying that Elon Musk told prospective investors in his deal to buy Twitter that he planned to get rid of nearly 75% of the company's 7,500 workers in the coming months. Later in the day, Twitter clarified to staff that there are no plans for company-wide layoffs since it signed a deal to be acquired by the Tesla boss.

American Express Co is expected to report third quarter earnings at lunch time. Analysts forecast earnings of $2.41 on revenue of $13.47bn. American Express is also likely to build loss provisions for loans that could go bad as consumer credit quality comes under pressure.

If analysts and investors are watching out for any signs of consumer spending slowing down in the country, cross border volumes are likely to jump, not only for American Express, but also for other US card companies, as business travel resume and people are planning vacations.

American Airlines, United Airlines Holdings and Delta Air Lines have also forecast strong profits for the rest of the year, in a sign that travel demand was offsetting concerns about expensive air fares.

Top oilfield services firm Schlumberger is expected to post a higher third quarter profit as oil and gas producers take advantage of higher energy prices to boost production. Analysts expect earnings of 55 cents per share on revenue of $7.10bn. The market will also look for comments on crude production growth as OPEC+ plans to cut production.

 

 

This is here for you to catch up but if you have any ideas on markets or events you want us to relay to the TV team we’re more than happy to.

[MongiIG]

For more up to date news on how markets will open, the latest earnings and economic news, watch IGTV live in the platform at 07:30am UK.

Today’s coverage:

Indices: Europe mixed. APAC mostly up by China and more especially HSI down heavily after Xi reshuffle expected to clamp down on dissidents

FX: USDJPY volatility continues after suspected BoJ intervention. USDCNH gains after China GDP finally released after Communist party congress wraps up. USD holding Friday’s losses. GBP bounces after Sunak looks to have won UK PM race  

Equities: Earnings – PSON PHIA. PHIA cutting 4000 staff, or 5% of its workforce, immediately – taking €300mln hit. TSLA drops ticket price 9% in China

Commods:  Gold holding Friday’s gains. Oil down after 3 days of gains. Natural Gas testing 3mth support

 

 

[MongiIG]

GBP rises as Rishi Sunak poised to become UK prime minister

Pound sterling bounces after Rishi Sunak looks to have won the race for the title of UK prime minister.

 

 Jeremy Naylor | Writer, London | Publication date: Monday 24 October 2022 

Indices overview

European indices are mixed.

The Asia-Pacific (APAC) region is mostly up but China and more especially the Hang Seng Index is down heavily. This comes after China's ruling Communist Party wrapped up its five-yearly congress, taking steps that further elevate the status and power of party leader Xi Jinping.

Forex

USD/JPY volatility continues after a suspected intervention by the Bank of Japan (BoJ).

USD/CNH has gained after China gross domestic product (GDP) was finally released after the Communist Party congress wrapped up.

USD is holding Friday’s losses, while GBP bounced after Britain's former Chancellor of the Exchequer, Rishi Sunak, appears set to become Conservative Party leader and prime minister. This is after former prime minister, Boris Johnson withdrew from the contest yesterday, saying that he had enough support to make the final ballot but the country and Conservative Party needed unity.

This means the election to replace Liz Truss could be a straight battle between Sunak and Penny Mordaunt, the Leader of the House.

Earnings update

On the corporate calendar today there are earnings releases from Pearson and Philips. Philips is cutting 4 000 staff, or 5% of its workforce, immediately – taking a €300 million hit.

Tesla has meanwhile dropped its ticket price by 9% in China.

Commodities

Finally on the commodities front, gold is holding Friday’s gain, while oil is down after three days of gains.

Natural gas is testing three-month support.

 

 

This is here for you to catch up but if you have any ideas on markets or events you want us to relay to the TV team we’re more than happy to.

[MongiIG]

Charting the Markets: 24 October

FTSE 100, DAX and S&P 500 on the up for now. EUR/USD, GBP/USD, and AUD/USD rebound brings potential reversal opportunity. And gold, Brent crude and lumber remain within bearish trend.

 

 

This is here for you to catch up but if you have any ideas on markets or events you want us to relay to the TV team we’re more than happy to.

[MongiIG]

Market data to trade on Tuesday: German Ifo; MSFT, GOOG, HSBA earnings

Earnings continue apace. On Tuesday UK banks begin to report with HSBC (HSBA), then later in the morning US all-sessions stocks including Coca-Cola (KO) and General Motors (GM) report before the bell on Wall Street.

After the bell there’s Alphabet (GOOG) and Microsoft (MSFT). Then, the DAX may move around the 9am UK release of the German Ifo business climate report.

 

 

 

[MongiIG]

For more up to date news on how markets will open, the latest earnings and economic news, watch IGTV live in the platform at 07:30am UK.

Today’s coverage:

 

Indices: VIX at 3wk lows after gains again on Wall St and across much of Asia. Europe expected to open mixed holding most of Monday’s gains. Hang Seng Tech index up by a record % move

FX: After 2 days of volatility in USDJPY, on speculation of intervention, little move today. USD little moved near 3wk lows

Equities: Earnings – HSBA (beat ests) WTB UBS (beat ests) NOVN (fell short) SAP KO GM HAL MSFT GOOG

Commods: Gold and oil little moved. Iron or challenging 3mth lows

 

 

 

[MongiIG]

HSBC beats third quarter estimates

HSBC is the first of the big UK banks to report, and it beat Q3 estimates, with credit losses offset by interest gains.

 

 Jeremy Naylor | Writer, London | Publication date: Tuesday 25 October 2022 

Indices overview

The Volatility Index (VIX) is at three week lows after gains again on Wall Street and across much of Asia.

Europe is holding most of Monday’s gains and is expected to open mixed.

The Hang Seng TECH Index is up by a record percentage move.

Forex markets

After two days of volatility in USD/JPY, on speculation of intervention, the pair is little move today.

The dollar is little moved at near three week lows.

Earnings overview

HSBC is the first of the big UK banks to report, and it beat third quarter (Q3) estimates, with credit losses offset by interest gains.

Elsewhere Whitbread and Swiss bank, UBS both beat estimates.

It's a really big day for US earnings today with reports expected from Microsoft , Alphabet , and General Motors .

Commodities

On the commodity front gold and oil are little moved while iron ore is challenging three month lows.

 

 

This is here for you to catch up but if you have any ideas on markets or events you want us to relay to the TV team we’re more than happy to.

[MongiIG]

Charting the Markets: 25 October

FTSE, DAX and Dow gain ground, but bears wait in the wings. EUR/USD and GBP/USD cling to gains while USD/JPY remains near Y149. And gold, Brent crude and lumber likely to head lower once more.

 

This is here for you to catch up but if you have any ideas on markets or events you want us to relay to the TV team we’re more than happy to.

[MongiIG]

Market data to trade on Wednesday: Canada rates; BARC, META, BA earnings

The Bank of Canada kicks off the first of three central bank meetings this week. IGTV’s Jeremy Naylor looks at USD/CAD. Then we're watching third quarter earnings from Barclays (BARC), Meta Platforms (META), and Boeing (BA).

 

 

 

[MongiIG]

For more up to date news on how markets will open, the latest earnings and economic news, watch IGTV live in the platform at 07:30am UK.

Today’s coverage:

 

Indices: Europe mostly up today after gains in NY and over much of Asia overnight. London showing mixed signs

FX: USD reversal picks up steam, DXY testing 50 day SMA EURUSD 3wk high. USDJPY down as BoJ buys excess bonds. Watch USDCAD as BoC may move 50bps on rates

Equities: Another big earnings day – BARC STAN WPP DBK F BA META. Last night MSFT & GOOG both fell, VISA rose. Musk expects TWTR deal done by Friday

Commods: Gold little moved, oil down for a 3^rd day