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DanielaIG

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  1. On the back of client feedback we now offer the possibility to customise the RSI levels on desktop and mobile devices. To do so, click on the RSI label once you have enable the indicator on your chart. This will open a dialog box that will allow you to change the levels (which are set at the default levels of 30/70), as well as customise the period and the colour of the lines. What is RSI? The Relative Strength Index is a momentum indicator that measures the magnitude of recent price changes to evaluate whether a stock is oversold or overbought. This indicator can oscillate between 0 and 100 and usually uses the level of 30 to indicate that a stock is oversold and the level of 70 to indicate that a stock is overbought. The RSI indicator uses the average percentage gains and losses of a specific period which is usually the last 14 days. When a candle closes after a positive move (a green candle stick) the RSI value will increase, whilst after a negative move (a red candle stick) it will fall as the number. The RSI value will be 0 if stocks fall on all 14 days and 100 if the price moves up on all the days. Like the price, the RSI creates highs and lows that can be connected to create resistance and support levels. In the same way as price action, these support and resistance levels can also be tested, broken and retested. How RSI is used as a forward-looking indicator These support and resistance levels can be broken on the RSI chart before they are broken on the price chart, which can create an opportunity to profit on a reversal before it takes place on the price. As with all indicators this is never a guarantee, however it does provide a qualitative supportive argument for possible price action. Let’s look at the Eurodollar 1-hour chart as an example of this resistance break: We can see that both the price and the RSI are testing a resistance level, but the breakthrough happens one candlestick before on the RSI chart than it does in the price chart. In this case, the RSI is a leading signal that offers possibility to enter the market at a more favourable price an hour before the actual price level breaks through the resistance level. Why would you adjust the RSI levels? For the RSI to be most effective, it has to be adjusted for the inherent volatility of a specific stock or market. In a very volatile environment the RSI is likely to hit the overbought and oversold levels with more frequency, weakening the reliability of the RSI as a leading indicator. When you widen the resistance and support levels you will probably have fewer trends, but they will possibly be better signals. As can be seen on the FTSE100 15-minute graphs below, the RSI tests the 30-support level various times, but it is not until it tests the 20-support level that the price trends actually reverses.
  2. Theresa May is coming under increasing pressure from MPs to stop the gridlock on Brexit negotiations. The pound is expected to see further volatility until at least mid-January as the unknown future of Brexit continues. The Dollar continued to trade at a 19-month high on Monday as concerns over slowing economic growth have reduced the appetite for riskier stocks and currencies and have backed the greenback as a safe-haven. The price of bitcoin has fallen below the cost to mine hitting a new low for the year of $3,126, loosing more than 80% since its ”tulip mania” phase at the end of last year. Without mining, bitcoin would cease to exist as it has no financial institution of Federal Reserve backing it up. The climate change talks held in Poland over the weekend have been said to end in success as the Paris accord of 2015 seems to have been reinforced. After China released lower than expected economic data on Friday, the Asian markets seem to be recovering as they enter the afternoon trading session, despite the Shanghai trading largely flat and the Shenzhen declining by 0.5%. The Nikkei 225 was up 0.8%, the Topix was up 0.3% and the ASX 200 was up almost 1%. Dow Jones futures indicate a slight recovery on the opening on Monday after all three major US indexes closed in correction territory on Friday. Asian overnight: A somewhat muted session overnight saw mixed fortunes within Asian, where the biggest outperformer came from the Australian ASX 200 index. The improved outlook for US-China relations helped drive mining firms higher yet in Australia, yet for the most part traders are somewhat cautious ahead of a critical week of central bank meetings. A quiet day ahead from an economic front sees a focus on elements such as the final eurozone CPI reading, alongside the US Empire state manufacturing survey. ...call for MPs to be allowed to vote on the future of Brexit UK, US and Europe: As the British PM Theresa May seems to stand with her denial to allow for a second referendum on Brexit, MPs are now calling for a free vote in Parliament to allow them to decide on how they believe the Brexit gridlock should end. International trade secretary Liam Fox was the first Brexiter to publicly call for MPs to be allowed to vote on the future of Brexit after talks with the EU at the end of last week did not go as planned for Theresa May when EU leaders refused to amend the withdrawal agreement. The PM is expected to update MPs today regarding the outcome of her EU meetings last week. A cabinet meeting is expected to be held on Tuesday and ministers are likely to step up contingency plans for a no-deal Brexit. Economic calendar - key events and forecast (times in GMT) Source: Daily FX Economic Calendar 1.30pm – US NY Empire state mfg index (December): expected to fall to 21.5 from 23.3. Markets to watch: US indices, USD crosses Corporate News, Upgrades and Downgrades ASOS has issued a profit warning, saying that it had seen ‘significant deterioration’ in its trading in November, despite 14% sales growth in the September to November period. The firm has reduced its expectations as a result. SSE has abandoned the proposed merger of its retail energy business with Innogy’s npower unit. Other options including demerger or outright sale are being considered. Croda International has agreed to acquire Brenntag Biosector for €72 million. The firm serves the human and veterinary vaccine market. Moncler upgraded to overweight at Morgan Stanley Senvion upgraded to overweight at JPMorgan Dometic downgraded to hold at Kepler Cheuvreux Zealand Pharma downgraded to neutral at Goldman Salvatore Ferragamo downgraded to underweight at Morgan Stanley Worldline cut to underweight at Morgan Stanley 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.
  3. DanielaIG

    Abbreviation "CR" meaning

    Hi Sudhanshu, CR means Controlled Risk. When a stock is listed as No CR it means that you are no able to place a guaranteed stop when opening a position. It is usually due to low liquidity, so we cannot guarantee our clients a specific price as it is too risky. I hope you find this useful. Regards
  4. This indicator emphasizes volume by weighing prices based on the amount of trading activity in a given period of time, where prices with heavy trading activity get more weight than prices with light trading activity. The VWMA has several advantages over a ‘simple’ WMA (which calculates an average of the closing price of ‘n’ number candlesticks giving the same weight to each one). With the volume weighted moving average (VWMA), the closing price of the day with the greatest volume gets a higher weight. On the IG charts you can turn on the VWMA on by right clicking on the chart itself and selecting ‘Volume Weighted Moving Average’ from the Indicator menu. Many traders use the VWMA and the simple WMA simultaneously. What does the VWMA tell us? As the VWMA is based around the volume, the gap between a ‘simple’ weighted moving average and a volume-weighted moving average shows the effect of volume weighting. This can be used to help with confirming trends or pointing out those trends that are weakening. If the VWMA stays below the WMA in a bullish market, it can be an indicator that the upward trend is lacking volume support and can signal a reversal in price. If the VWMA stays below the WMA in a bearish market, it can confirm a downward trend, signalling that a decline in price may continue. Graphic examples The green arrow indicates an area where the VWMA line has crossed from under the WMA, indicating that there could be a bullish trend coming in to play. When the price action is in an upward trend and it’s able to break through both averages then a bullish trend is thought to be confirmed. The red arrow indicates an area where the VWMA line crosses below the WMA line, indicating that a bearish trend could be forming. When the price in a downward trend and is able to break through both the averages then a bearish trend is thought to be confirmed. It’s important to keep in mind that when the VWMA is between the WMA and the price, there is a likelihood of the trend continuing in that direction. If the VMA line crosses over and positions itself between the VWMA and the price, it may be indicating a reversal is in place. These are only a few examples of how this indicator can be used. Feel free to leave your opinion and share your uses and examples for further discussion.
  5. DanielaIG

    New indicator: Ease of Movement

    What is the EOM indicator? An indicator that highlights the relationship between price and volume and is particularly useful when assessing the strength of a trend. As implied by its name, it is used to measure the ease of movement in price. It is a volume-based oscillator that fluctuates above and below the zero line. In general, when the oscillator is above zero, the price is advancing with relative ease. When the indicator is below zero, the prices are declining with relative ease. A wide range (difference between highs and lows) on low volume implies that price movement was relatively easy, as it did not take much volume to move prices. Alternatively, a small range and large volume indicates that price movement was difficult as there was a relatively small price movement on high volumes. Other important things to remember with EOM The closer the EMV line is to zero, the less ease of movement on that specific period. The bigger the spike in the EMV line, the more ease of price movement, either positive (if above the zero line) or negative (if below the zero line). The ease of movement indicator can also be used as an average, by adding together various single-period ease of movements and dividing them by the number of periods being considered. By smoothing out the indicator over time it can be used to identify trends and areas of convergence/divergence. A graphic example Let’s review the EOM indicator by using it in a real-life example which took place at the beginning of Dec ‘18. Using the Wall Street 30 min chart we can see a correlation between the EOM indicator and subsequent market movements at the opening of the session on Monday. Looking at the chart below you can see there is a positive spike in the EOM line which holds for a few periods before it starts declining. The cause for the spike is likely to have been the bullish (but cautious) reaction to a ceasefire between the US and China on trade tariffs. This could have meant that traders were holding Wall Street pushing the price higher, however maybe not as many people bought into the rally, therefore creating a big range on low volume. To summarise: After the initial positive reaction from the markets, traders could have become more sceptic about the viability of the ceasefire, and therefore a more bearish reaction comes in to play. This increases the range as lower lows appear maintaining the EOM at a high level. As more and more traders become sceptic, highs become lower, decreasing the range, which paired with a stable volume results in a declining EOM line. As you can see from the graph, the EOM line reacts before the actual price does, as a tightening range indicates that investors are becoming more bearish, which can eventually lead to a decline in price if it sustained over a period.
  6. Huawei CFO Meng Wanzhou was arrested in Canada where she faces extradition to the US for violating US sanctions, leading to growing tensions between the China and US that create further doubt about the cease-fire on the tariff war declared over the weekend. Shares in Asian suppliers to Huawei sank on Thursday after the arrest was made pubic. Asian markets fell on Thursday ahead of the highly awaited OPEC meeting to be held in Austria today. The Hang Seng was down 2.62%, the Nikkei fell 1.91% and the Shanghai composite slipped 1.26% during the morning trading session. The UK could face “protracted and reported rounds of negotiations” if it tries to exit a backstop customs union with the EU. The FTSE 100 closed 1.44% lower at 6.921,84 on Wednesday, with a general decline in its constituents led by Ashtead Group PLC, Melrose Industries PLC and NMC Health PLC who lost 5.83%, 5.05% and 5.05% respectively. European stocks were trading lower on Wednesday as continuing worries about global trade leave investors with concerns regarding the future of economic growth. The Dax was down 1.19% whilst the CAC and the IBEX were down 1,36% and 0.55% respectively. US markets are expected to continue the sell-off on Thursday as DOW futures drop almost 400 points. As stock markets remained closed on Wednesday for the official mourning day of former US president George H.W. Bush, the growing tensions between China and the US continue to place uncertainty on the viability of the two countries honouring the cease-fire declared over the weekend, leaving investors feeling weary, which is putting downward pressure on the stock market. Palladium has become one of the best performing precious metals in the year, dethroning gold as the most valuable precious metal. The metal hit $1,257 per ounce, surpassing the price of gold for the first time since 2002. The demand for palladium is expected to rise as tougher emission laws come in to place. Copper has drifted to a one-week low as US-China tensions resurface. Join us today at 1pm to discuss the future of Base Metals where you can ask your questions to our guest experts Daniel Lacalle and John Meyer, either via youtube, twitter, facebook or by posting them on the comments section on the following link: https://community.ig.com/blogs/entry/271-igcommoditychat-base-metals/ Asian overnight: The arrest of a senior Huawei executive provided the spark for a fresh round of selling in Chinese equities, adding to a broadly grim session for Asian markets. Tech stocks in Hong Kong suffered heavily, with the overall index down 2.9%. Oil prices have begun to get the jitters ahead of the OPEC meeting today, with the decision expected at 5pm London time. ...the backstop which would keep the UK in a customs union with the EU, would “endure indefinitely” UK, US and Europe: A full text of advice written by the attorney-general Geoffrey Cox was published on Wednesday, a day after MPs found the government to be in contempt of parliament by not publishing the document, in which Mr Cox states that the backstop which would keep the UK in a customs union with the EU, would “endure indefinitely” until and alternative solution was applied to avoid a hard boarder. The general negative correlation between the sterling and the UK equity market is starting to diminish. In the past, we have seen that as the pounds weakens, the FTSE100 gains strength. This inverse relationship has faded and we are now coming to see a positive correlation between the sterling and the equities market. This is most likely due to the growing concerns that Britain will leave the EU with a “no deal”, which is seen to be catastrophic for the UK economy. The OPEC meeting is the main event, with a cut of 1.4 million barrels in daily output the baseline expectation. Anything less than this may result in fresh downward momentum in crude. Aside from this, the calendar is rather quiet although we do have the US trade balance later today. Economic calendar - key events and forecast (times in GMT) Source: Daily FX Economic Calendar 1.30pm – US trade balance (October): deficit to hold at $54 billion. Market to watch: USD crosses 3pm – Canada Ivey PMI (November): expected to fall to 60.8 from 61.8. Market to watch: CAD crosses Corporate News, Upgrades and Downgrades DS Smith said that first half revenue rose 16% to £3.07 billion, while adjusted operating profit was 32% higher at £304 million (both in constant currency terms). Ted Baker has appointed law firm Herbert Smith to look into allegations of inappropriate behaviour. The firm added that group sales were down 0.2% for the 16 weeks to 1 December. Hiscox and Spirax-Sarco will be joining the FTSE100 replacing Just Eat and Royal Mail. Changes will be effective from start of trading on Dec. 24. Faroe Petroleum raised to equal-weight at Barclays Genus upgraded to buy at Kepler Cheuvreux Takeaway raised to sector perform at RBC Capgemini downgraded to equal-weight at Barclays Klovern downgraded to reduce at Handelsbanken Petra Diamonds downgraded to hold at Panmure Gordon Sage downgraded to add at AlphaValue 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.
  7. On the back of client feedback and the success experienced on the IG apps, we have now added the deal position preview functionality to the web dealing platform. This feature is automatically enabled on the new dealing platform. To disable it, right click on the graph and select Position Preview from the “show” dropdown. What does this feature tell me? When filling in a deal ticket, new visual features will appear on the graph. When the direction (buy or sell) is selected, a shaded area will appear above (if buying) or below (if selling) the current price. This area will show the price the market needs to touch to profit from the transaction. The shaded area will not start from the price you executed the trade at, as the market needs to move in your favour by the size of the spread before you are at break-even. In the example the Buy price is 1239.39 The blue ‘profit level’ is displayed at the executed deal price +/- the spread It's important to remember the price level on the chart can either be the bid (buy), mid or ask (sell). For the 'profit level' to work properly will require you to have the correct price level displayed on the chart. You can select this by right clicking on the chart and selecting bid (if you're buying) or ask (if you're selling). Adding a stop If a stop is added, a new shaded area will appear in the opposite direction. This will give a visual representation of the range of movement your position has before the stop is triggered and your position is closed out. Adding a limit By adding a limit, a risk/reward ratio will appear. This will compare the expected return of the position with the amount of risk undertaken to capture such returns via the ‘Risk/reward ratio’. What is the risk/reward ratio? This ratio is used to assess the potential for profit relative to the potential for loss. Risk is determined by a stop loss, and reward is determined by the limit. If the risk/reward metric is 1:5, it means that a trader expects five units of expected return per every unit of additional risk, this gives a ratio of 0.2. If the ratio is greater than 1, then the risk is greater than the potential profit on the trade. It is important to keep in mind that, whilst a low risk/reward ratio of 0.2 is very attractive, you need to consider the odds that the profit target will be reached before your position is closed out if the stop is triggered.
  8. Turning on FX swap bid/offer When trading currency pairs, if a position is held through 10pm, it will incur an overnight funding charge. This charge is based on the interest rate differential between the two currencies in the pair, where you receive interest in the currency you buy and pay interest on the currency you sell. Swap rates also apply to cryptocurrencies and spot gold, silver, platinum or palladium. Based on client feedback we have now added these overnight funding charges to the platform. Please keep in mind that they are indicative figures. These swap rates are viewed from a watchlist. Once you have an FX pair on the watchlist, by clicking on the three lines that are positioned on the left-hand corner next to the word 'market', a drop down of columns will appear. Click on the swap bid and swap offer buttons to activate them. What does this mean for me? If GBPUSD was quoted as 0.22 / -0.85 then the 0.22 would be what you receive if you are short, and the 0.85 would be what you pay if you are long. You then need to do the trade size times this value. For example a spread bet of £3/pt on the short trade would result in a credit to your account of 66p (which comes from 0.22 x £3). If you have a CFD account and you're holding a single $10 contract long, you would pay $8.50 per night (which comes from 1 contract x $10 x 0.85). Where does this figure come from? The figure is shown in points and depending on the currency you hold and the direction of your trade you can either earn or pay a premium, keeping in mind that there is an IG charge of 0.3% (0.8% for mini contracts and spread bets) included in the calculation. If you are long on a currency pair, you will need to focus on the swap offer, and if you are short you will focus on the swap bid. If the swap is a positive number, you will be credited, because the interest rate on the currency you are buying is higher than the interest rate on the currency you are selling. If the rate is a negative number you will be charged, because the interest rate on the currency you are buying is lower than the interest rate on the currency you are selling. If the interest rate on the euro is 0.25% and the interest rate on the USD is 2.75% and you buy EURUSD, you will be receiving 0.25% but paying 2.75%, and will be left with an interest rate differential of 2.5 points (excluding the IG change). Example: Let us take EURUSD as a worked example. We will need two figures for our calculation, the underlying market swap rate (known as the Tom/Next rate, which is provided by the banks), as well as the current spot rate of the currency pair at 10pm. The below figures are indicative for this calculation. An example of the underlying 'Tom/Next' rate for EURUSD: 0.34 / 0.39 An example of today's Spot FX rate for EURUSD at 10pm UK time: 1.0650 Once we have the Tom/Next rate, we take the 10pm EURUSD spot rate (in points) and multiply by IG's charge of 0.3% (or 0.8% for CFD mini or Spread Betting deal), which is then divided by 360 days to get an overnight value. = (10650 x 0.3%) / 360 = 31.95 / 360 = 0.08875 This is then applied to the underlying market quote of 0.34 / 0.39 Bid = 0.34 - 0.08875 = 0.25125 = 0.25 Offer = 0.39 + 0.08875 = 0.47875 = 0.48 This then gives us our overnight funding rate, inclusive of IG charge, of 0.25 / - 0.48. The '˜Offer' is negative, because currently there is a higher interest rate on USD than there is on EUR. Therefore, buying the pair would leave you paying a larger USD interest vs receiving a smaller EUR interest. E.g. If you were long one main lot, you would do 'Number of Contracts x Contract Size x Tom Next Rate'. Using the information above, if you were long one main lot, your 'Daily FX Interest' would be: 1 x $10 x - 0.48 = $4.80 charge per night. (Conversely if you were short, you would receive $2.50 per night). Important factors to note FX settlement of T+2 means that if you hold your trade through 10pm Wednesday (UK Time) then you'll need to incorporate the weekend into the calculation, and therefore you'll have an 'FX Interest Charge' of 3 days. This is because currency can't settle at the weekend, and the new spot rate would therefore fall on a Monday. It also follows that if you hold through 10pm on a Friday, you only receive a 1 day charge (even though you have to hold through three days before you can close the position). Settlement of FX can't take place on public holidays. Therefore, over periods such as Christmas or Easter, or public holidays such as Martin Luther King Day or Thanksgiving, you may see interest charges for a variable number of days. Some currencies trade on a T+1 basis, most notably USDCAD, USDTRY and USDRUB.
  9. DanielaIG

    Where to find overnight funding charges on FX pairs

    Hi Stevtheangle, Swap rates are only displayed on a watchlist as of now. It is very useful and simple to create a watchlist where you can track the products you are most interested in and can have added functionalities like these, which are not available on the standard product lists. Thank you everyone for the positive feedback, we are glad you find these functionalities useful.
  10. You can now add % Range to a watchlist on the web trading platform % Range is the difference between the high and low quotes of the session divided by the current mid price This can be used to show a relative volatility on the asset and its potential trade opportunity % Range has a number of advantages over % Change and Range in points How to add % Range A new function added to the web trading platform is % Range, a measure of volatility that will enable you to sort the markets in your watchlists by price range movement. To add this functionality to a watchlist, click on the three lines that are positioned on the top left-hand corner next to the word 'Market', where a drop down menu will appear. Click on the % Range buttons to activate it. What is % Range? This indicator is intended to indicate the price range a product has had during the trading session and is calculated in the following way: % Range= (High price – Low price) / Mid price By dividing the range (the difference between the high and the low prices) by the mid-price (the current market value of an asset) the value we get is a how much the range of the trading session is over the mid-price, as a percentage. The higher the figure, the higher the volatility during the trading session, and potentially a greater opportunity to take advantage of price movements. If the price has seen little movement, the highs and lows will be close together, meaning that the difference between the two will be small and will represent only a small percentage of the mid-price. If, on the contrary, the range for the trading session is very wide, the value will represent a higher percentage of the mid-price, therefore indicating that there has been higher volatility. Advantages of % Range over % Change and Range % Change tells you the current difference in price as a percentage over the closing price of the previous day. It is a good measure to understand where the current price stands in regard to where it closed in the previous session. However, if a certain asset experienced high volatility during the session but then came back to where it closed the previous day, it will not give any insight of the volatility it has experienced. Range is a good measure of volatility, but the amount of points between the high and low price can be more or less significant depending on the price of the product. For example, a 200 point range is not the same for a market priced at around 400 than to a market priced around 12000. % Range overcomes this as it factors in the price of an asset by brining it's mid-price into the equation. The lower the mid price, the more significant price movements will be.
  11. DanielaIG

    #IGCommodityChat: Oil

    What is the murky future of Oil? Continuing our #IGCommodityChat and following this week's chat on gold, join us on Thursday the 29 November at 1pm (UK time) to discuss the future of the oil market with industry advisor Malcolm Graham-Wood and Spencer Welch, director of oil markets at IHS Markit. The demand for oil has increased over the last few decades due to the rise of emerging economies and the requirements of the transport industry. However, in recent years, concerns have been raised about how sustainable oil supply and demand actually are. In fact, the Organisation of Petroleum Exporting Countries (OPEC) and non-OPEC producers, mainly Russia, have restricted oil production in order to provide support for oil prices. The most significant force influencing oil demand is the rise of renewable energy. As investment in alternative energy grows, the future of the oil industry is starting to look like one of decline. Oil and gas companies might be forced to rethink their long-term strategies in order to secure a role for themselves in the new energy economy. Although it will likely be a number of decades before the oil market sees the full consequences of these changes, OPEC has lowered its predictions for world oil demand for the rest of 2018 and 2019. With so much uncertainty surrounding the future of the oil market, we’ll be taking a look at how the industry changes might influence the price of oil. You can watch the live stream at 1pm (UK time) on Thursday 29 November via the trading platform, or our YouTube , Facebook and Twitter pages. Submit your questions now There will be a live Q&A during the session, so you can put forward any topics you’d like Malcolm or Spencer to discuss, or any questions you want answered. Post your questions to the #IGCommodityChat using the comments section below, and check out one of the latest #IGChats we recently posted on gold to get a flavour of what to expect. The show will be broadcast live from within the dealing platform as well as via a special YouTube link and on various social channels. Oil discussion topics The discussion will cover a wide range of topics that relate to oil, including: How the agreement between OPEC and non-OPEC countries will influence supply The impact of political sanctions on oil producing countries How the emergence of alternative energy sources has impacted the oil market How the flotation of the Saudi Arabian Oil Company (Aramco) will impact the oil market
  12. After yesterday´s meeting in Brussels, Theresa May said “both sides have given sufficient direction” and she will meet Jean-Claude Juncker again on Saturday “to discuss how we can bring to a conclusion this process and bring it to a conclusion in the interest for all our people”, indicating that a final deal is likely to come very soon. The 27 remaining countries in the EU will meet with Theresa May on Sunday, where they will vote on the Brexit deal. Spain, the only country that was set to veto the UK´s exit agreement over ongoing territorial disputes regarding Gibraltar, seems to have reached a separate pre-agreement deal with the UK over the territory in question. US stocks bounced back on Wednesday and hit resistance levels. Even thought the Dow Jones closed slightly lower, it was trading 1% higher at midday, whilst the S&P500 and the Nasdaq closed at a gain of 0.39% and 0.92% respectively. European stocks were also trading higher on Wednesday as the Stoxx 6oo index rose 0.7%, the CAC 40 was up 0.6%, the DAX and the IBEX 35 both gained 1%, and the FTSE 100 was up by almost 1.5%. Chinese stocks start the day with uncertainty as the Shanghai Composite was trading 0.5% lower by the end of the morning session, and the Shenzhen dropped 0.3%, as investors remain cautious ahead of the G-20 meeting between Xi Jinping and Donald Trump on Dec 1. The rest of Asia saw a more positive start to the day, as both the Nikkei 25 and the Topix saw gains of 0.6%. The positive movement extended also to Australia, as the ASX 200 saw gains of around 1%. Gold bounced back on Wednesday as it traded above $1,220 per ounce, inching closer to $1,300, price at which it started off the year. Oil prices recover on Wednesday but take a negative turn on the Asian afternoon trading session, as crude futures falling 0.4% and Brent slipping 0.3% The European Commission is looking in to sanctioning Italy over its debt budget indiscipline. They will demand Italy to explain how it will remedy its budget plans in order to abide by EU rules. If Italy fails to do so, the EU could open a “debt-based Excessive Deficit Procedure (EDP)”. Consumer confidence for the month of November fell to 97.5, down from the previous month´s 98.6. The survey is based upon 500 consumers´ sentiment towards economic and political matters such as personal finance, government policies and unemployment. US durable goods fell 4.4% last month. The decline is believed to be led by US companies being cautious about spending resources amidst ongoing trade wars with China. Asian overnight: A largely bullish session overnight saw some reprieve from the wider bearish trend, following on from a US and Europe rebound yesterday. Chinese stocks were the one outlier, with the Shenzhen composite trading in the red. Meanwhile, the dollar was grinding lower, following reports that the Fed could end their tightening cycle as early as next spring. Theresa May's meeting with European Commission head Jean-Claude Juncker ended with "very good progress" UK, US and Europe: Brexit hopes are up again as a deal seems to be inching closer after Theresa May's meeting with European Commission head Jean-Claude Juncker ended with "very good progress" and a new meeting for Saturday seems to indicate that a deal is more likely to happen than not. Spain seems to have reached a pre-agreement with the UK which could ensure that the future of Gibraltar would be settled directly with Madrid, leaving it out of the EU exit agreement. Looking ahead, the US Thanksgiving holiday, coupled with a general lack of economic releases throughout Europe and Canada means we could have a relatively quiet session. Any fundamental drivers will have to be already in play or coming from left field. Thus stay aware of any potential shift in the state of play for Brexit, with talk of the Germans pulling out of Sunday's EU summit already worrying markets. It seems that for all the UK misgivings over the proposed deal, it is not a guaranteed that it would pass through the EU either. Gold has reacted in an atypical way in the last few months. Usually a safe heaven when bear markets occur, gold has lost about $100 per ounce since the beginning of the year, despite trade sell offs and a slowing economy sending equities into bearish territory. This could change going forward, as tightening monetary policies and slowing economic growth could weaken the dollar, the main factor working against gold, leading to an increase in the value of gold as a safe heaven. Join the chat about the future of gold today at 1pm UK time as we sit down with professional investor Simon Popple and Ross Normal, CEO of Sharps Pixley, where you will be able to ask questions on a live Q&A. You can leave your questions on the comments sections of the following link: Economic calendar - key events and forecast (times in GMT) Source: Daily FX Economic Calendar 3pm – eurozone consumer confidence (November, flash): index to rise to -2.4 from -2.7. Market to watch: EUR crosses Corporate News, Upgrades and Downgrades GVC has acquired Australian firm Neds International for A$95 million. Centrica maintained its full-year outlook, despite a weaker performance from its exploration and nuclear divisions. Mothercare said that like-for-like sales fell 11% during the first half, while adjusted pre-tax losses rocketed to £6.2 million from £2.6 million. Aeroports de Paris raised to sector perform at RBC Centamin upgraded to outperform at RBC Just Eat upgraded to neutral at JPMorgan Fortum downgraded to hold at HSBC Halma cut to equal-weight at Morgan Stanley 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.
  13. DanielaIG

    Payment and withdrawal

    Hi Dereck, We are a CFD and Spread Betting broker, you might have gotten confused by the IG initials. Regards, Daniela
  14. Hi Steve, Yes, the profit/loss you see on the trade when it is open includes the spread that IG charges, so if you were to close the position that is the profit/loss you will receive. This applies for all products on spreadbetting, and CFDs on everything but shares. With CFD on shares, you the profit/loss that is shown on the live position is the difference between the buy and the sell price, IG's commission will be charged separately. When you have no open positions, your equity is essentially your funds, as there is no running profit/loss to add/substract to it. There is an overnight funding cost for holding cash positions through 10 pm UK time. Please visit the following link which gives a detailed explanation on what our charges and commissions are: https://www.ig.com/uk/spread-betting-cfds-charges If you have any further queries do not hesitate to contact be by @ tagging me in the post. Regards, Daniela
  15. DanielaIG

    Where to find overnight funding charges on FX pairs

    Hi @hart, as @Caseynotes mentioned, this functionality has only been added to the new web platform so you would need to switch in order to view it.
  16. DanielaIG

    Book Cost

    Hi @Ara, Total book value cost has to be added manually by adding stamp duty and commissions to the cost of buying the shares. We do not offer an automatic book value cost calculator, as this will also depend on the cost associated with closing the position. Regards, Daniela
  17. Theresa May´s cabinet is set to meet today in order to try and find a solution to the Irish border crisis, the main headache for Brexit talks in the last few months. As a result of the uncertainty regarding a Brexit deal, the GBP weakened against its major pairs, falling by almost 1% against the US dollar and 0.2%against the Euro. The Dow Jones lost 2.32% on Monday falling by 602 points to close at 25,387.18, after Apple suffer another hit and worries over global trade continue. The Nasdaq re-enters correction territory as it lost 2.8% to close at 7,200.87. Goldman Sachs shares suffered their biggest loss in 7 years, leading the S&P 500 to drop 2% to close at 2,726.22. The fall comes after the Malaysian finance minister demands a full refund of the $600million fees they paid To GS in order to help set up the fraudulent state investment fund 1MDB. Cigarette shares dip on Monday as the US Food and Drug Administration (FDA) consider banning menthol cigarettes. The fall was led by British American Tobacco that lost almost 11% closing at 2.962,50 as investors fear over the future of the newly acquired US menthol brand Newport. A smaller than expected demand for vaping products has also led to the company´s revenues to miss targets for the year so far. Italy has reached its deadline to submit a revised budget draft to the EU but, despite pressure from Brussels, Italy shows little signs of altering its budget as it targets to boost government spending. Because of this, Italian bond years rose again on Monday, increasing between 1.3% and 3.5% across the curve. Asian markets start the day in the negative territory but seem to recover into the afternoon. The Hang Seng dipped to 25,092 at the open but has recovered in the afternoon trading above Monday's closing price. The Nikkei 225 has been trading at a 2% loss from the previous close whilst the ASX 200 is ending the day 1.8% lower. Airline stocks have been hurt after the OPEC cartel announce they are looking to stabilise oil prices by reducing supply after prices have fallen around 20% in the last month. International Consolidated Airlines (IAG) closed 0,9% lower on Monday at 637,60. Asian overnight: Asian markets followed their US counterparts lower overnight, with a sharp deterioration in Apple shares sending tech stocks lower in markets such as the Topix, ASX 200, and South Korean Kospi composite. This came after two of Apple’s suppliers cut their earnings forecasts, causing markets to worry whether iPhone sales had peaked UK, US and Europe: The Pound has had a tough start to the week as the markets start to factor in the possibility of a “no deal” Brexit. As it is becoming increasingly possible that Theresa May is not going to be able to pass a deal in Parliament before the deadline on March 29th, the pound is starting to come under pressure against major currencies such as the Euro and the US Dollar. We can expect the Pound to trade with increased volatility this week as key meetings will shape whether there is a possibility of a Brexit deal to fit all. The Brexit negotiations have come under heat as Theresa May has tried to create a UK customs union in order to avoid a hard border on the Island of Ireland. But the EU has rejected this idea by enforcing the backstop plans which lock in the UK in a relationship with the EU which cannot be ended without the EU´s permission. We can expect the Pound to trade with increased volatility this week as key meetings will shape whether there is a possibility of a Brexit deal to fit all. After the recovery from the 2008 financial crisis, the stock markets have been performing seemingly well keeping a consistent uptrend throughout the years but the trading activity of the last month have left investors worried over the health of the financial systems. As earnings have been consistently increasing and companies are performing well, there have been talks about how long this sustained growth can last, questioning if the markets have reached their boiling point. After October became one of the worst trading months in years, the month of November had seemed to bring some relief to stock markets, but after Monday's sharp decline it shows that the markets remain volatile. All it took was bad production figure for Apple and possible regulatory action against Goldman Sachs to send the stock market into a downfall. As the potential for a slow down in economic growth and earnings is starting to take place amid ongoing trade wars and rising interest rates, investors are advising clients to remain cautious and reduce the amount of risk by diversifying their portfolios in order to be prepared for the months to come. Looking ahead, UK jobs data provides a focus on the pound, with average earnings expected to rise sharply to a three-year high of 3%. Also keep an eye out for the German ZEW economic sentiment survey, coming in a week that is expected to see the German Q3 GDP reading hit negative territory. Economic calendar - key events and forecast (times in GMT) Source: Daily FX Economic Calendar 9.30am – UK employment data: claimant count to rise by 3200 from 18,500 in October, while unemployment rate holds at 4%, and average hourly earnings rise 2.6% in September. Market to watch: GBP crosses 10am – German ZEW (November): economic sentiment to rise to -12 from -24.7. Market to watch: EUR crosses 11.30pm – Australia Westpac consumer confidence (November): index to rise to 103 from 101.5. Market to watch: AUD crosses 11.50pm – Japan GDP (Q3, preliminary): forecast to be -0.3% QoQ from 0.7%. Market to watch: JPY crosses Corporate News, Upgrades and Downgrades Taylor Wimpey said that sales rates grew in the second half, up to 0.77 from 0.71 a year earlier. The current order book was up 9% over the year, to £2.4 billion. Vodafone suffered a loss of €7.83 billion for the first half, arising from the disposal of Vodafone India, higher financing costs and de-recognition of a deferred tax asset in Spain. Experian suffered a 5% drop in pre-tax profit to $470 million for the first half, while revenue rose 7% to $2.36 billion. Allied Minds upgraded to buy at Jefferies Anglo American raised to hold at Global Mining Research Zurich Airport upgraded to hold at Santander Total upgraded to buy at AlphaValue IP Group downgraded to hold at Jefferies ThyssenKrupp downgraded to hold at Bankhaus Lampe Orpea downgraded to neutral at Credit Suisse Sophos downgraded to hold at Shore Capital 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.
  18. Hi Shamir, Just to clarify: -Short interest: overnight funding cost for holding the position after 10pm UK time - Stock borrowing: commission for "borrowing" the share in order to go short (will only apply to share positions on leveraged accounts) Both charges will charge a 3 day commission on Friday in order to cover the weekend. Hope this clears it up a bit more. If you have any more queries don't hesitate to ask! Regards, Daniela
  19. Hi @1kp1, I have replicated the scenario on both my spread betting and CFD accounts both on Chrome and Internet Explorer and have not encountered the same problem. We have data going back to 2001 for Natural Gas so I doubt it is due to a lack of data points. Maybe this is an issue that has been resolved since you posted it on Tuesday. Could you please check for me and let me know by tagging me using the @ symbol (or give us a call so we can help you in real time). Regards, Daniela
  20. Hi Shamir, So as you mentioned, on cash positions you will be charged an overnight funding charge for every day you hold the position through 10 pm UK time. On top of that, when you enter into a short position on shares, there is a borrowing cost. this is because when you enter into a short position on shares, you are essentially borrowing the stock as you do not physically own it, therefore you will need to fund the ability to borrow the shares to be able to open a short position. This rate is based on a borrow premium that we receive from our brokers which we then add an IG fee of 0.5%. Regards, Daniela
  21. The US Dollar is holding within tight margins as investors are showing discretion ahead of the US Midterm elections that take place today. The Dow closed up 190.87 points at 25,461.7 and the S&P rose 15.2 points closing at 2738.31 led by the financial and energy sectors. The Nasdaq fell 0.38% lower at 7328.85 as Apple and Amazon both fell more than 2% Apple has had its second downgrade since its earning report last week, as Rosenblatt Securities followed Bank of America Meryll Lynch in downgrading Apple from buy to neutral. After this second downgrade, the stock fell 2.8% to $201.59, accumulating a loss of 9.2% since the earnings report. Berkshire Hathaway earnings beat expectations after announcing a $1billion buy-back, sending a strong signal to the market, and closing on Monday at $216.24, up 4.68% Italian Bank shares have suffered a hit as Banco BPM fell 3.4%, UniCredit fell 1.6%, Ubi Banca fell 1.8% and Intesa Sanpaolo fell 2.2% on the back of Goldman Sachs downgrade on Friday. The drop in Italy’s main banks shows a continued uncertainty of the country´s short-term future as the government continues to challenge the European fiscal rules. Inflation has risen 15% yoy in Turkey after pressure to lower interest rates in order to induce spending and economic growth to overcome the country´s “currency crisis”. Uranium prices have hit a 2.5 year high as producers have started to invest in new plants as the demand for nuclear power increases. The price of Uranium has risen by 40% from its lows in April. Crude oil prices continue to fall as continued sanctions and concerns over economic slowdown take their toll on carb fuel demand. Asian overnight: A mixed Asian session has seen the Chinese markets providing the sour note on an otherwise bullish period. Japanese household spending tumbled to -1.6% against expectations, while the RBA kept rates unchanged as widely predicted. However, with recent volatility to consider, the session has been a largely positive and stable one for Japanese and Australian stocks in particular. UK, US and Europe: The midterms are the general elections that are held near the mid-point of a president's four year term of office, it is a combination of elections for the US Congress, governorship and local races. The results will be seen as a sentiment towards Trump's presidency and his accomplishments, and historical results show that disgruntled voters use the midterms to punish the party in power. It is expected that the markets have already factored in an increase in “blue representatives” as it is expected that Democrats will regain control of the House of Representatives Whilst the Us economy is booming with low unemployment rates, Trump's tax cuts for corporations have increased the country's deficit by 33% in the last year. Immigration will be a decisive issue in the voting taking place today, as the Democrats have tried to pull in minority votes by criticizing Trump's "zero-tolerance" policy towards immigration. It is expected that the markets have already factored in an increase in “blue representatives” as it is expected that Democrats will regain control of the House of Representatives and the Republicans will maintain the Senate, resulting in a government gridlock, which has historically seen positive reactions from the US equities markets. The extent of the gains will depend on the potential change in the House as it has decision over social and economic structures. A result that gives the Republicans full control could be seen as positive for the equity market as there could be further fiscal stimulus and tax cuts. On the other hand, if the democrats gain control of both the House and Senate, which is seen as less likely, would likely lead to a negative sentiment in US equities as they could reverse some of the policies in place to boost the short-term economy. An equally impactful situation on the markets would unfold if the future representatives is left unclear after the elections as uncertainty would affect the market sentiment. It is likely that the US Dollar could rally if the result of the elections give full control to the Republicans as Trump's economy boosting policies will continue. On the other hand, the US dollar is expected to fall in the short-term if the elections result in a political gridlock, with the dollar taking further hits if the Democrats regain full control. Economic calendar - key events and forecast (times in BST) Source: Daily FX Economic Calendar 21.45pm - NZD Unemployment rate for the 3rd quarter: expected to fall from 4.5% to 4.4%. Corporate News, Upgrades and Downgrades Wm Morrison saw Q3 sales rise 5.6%, with positive like-for-like for three-years. Interestingly, the wholesale business is also a big performer, growing 4.3%. Same store growth came in at 1.3%. Randgold Resources saw Q3 profitability rise after a round of cost cutting (down 10%), with profits for the three months to September rising 21% on-year to $73.2m. Much of that period saw the company’s Tongon mine in Ivory Coast on strike. Randgold shareholders will vote on Wednesday after a takeover bid from Barrick Gold. DS Smith expects to see a first-half operating profit well ahead of the previous year's result, as the company continues to raise prices to account for increased input costs. KPN upgraded to Buy from Neutral at BofAML 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.
  22. The European Central Bank is announcing its monetary policy today, with expectations that Mario Draghi will confirm that the ECB stands by its plan to end its quantitative easing program by the end of the year. The euro plunges on Wednesday as concerns over the Eurozone growth continue. Italian government bonds remain at year-highs as the EU has rejected the country's deficit plan. Yields are expected to remain high over the next few weeks as the Italian government says that the budget plan is designed for Italy and not Brussels, suggesting future disagreements between the two. The Canadian dollar gained on Wednesday after the Bank of Canada increased key interest rates by 25 basis points to 1.75%, keeping to expectations. The S&P500 goes into negative territory for the year as it ended 3.1% lower at 2656.10, down 0.65% year to date, and the Nasdaq had its worst one-day drop in 7 years as it fell 4.4% at 7108.4. The Dow Jones has erased all of its gains for 2018 as it dropped 600 points on Wednesday's trading session Markets in Asia fell overnight as they follow the US major stock indices sell-offs. Oil prices have also suffered from the global stock market slumps as prices have fallen by 1% due to selloff pressure. Asian overnight: Asian markets followed their US counterparts lower overnight, with a massive 3% decline in Japanese stocks closely followed by their Australian counterpart (-2.8%). The tech-focus continued into Asian markets, after the Nasdaq had its worst day in seven-years. Oil prices slide sharply overnight too, after the Saudi Arabians raised production to 11-million bpd. Could we see the Saudi Arabians begin to drive down oil prices as a gesture to Donald Trump amid the current Saudi crisis in Turkey? UK, US and Europe: The European Government announced earlier this year that it was planning on phasing out of its quantitative easing policy, a crisis-era stimulus with a plan to produce stable inflation and solid growth, signalling that gradual increases in interest rates were to come. But as economic events of the past few weeks have unfolded, the ECBs expected economic health of the Eurozone may not have held up, as there have been signs of weakening growth in some of the countries in the Eurozone and inflation levels have remained below the ECB’s 2% target. ...damage from inside the eurozone has also led to hurting the sentiment surrounding the ability to grow In the recent months, the risk of external shocks has risen, led mainly by continuing trade tensions between the US and China, the high prices of oil due to geopolitical risks, and the prospect of a hard Brexit outcome. Adding to that, damage from inside the Eurozone has also led to hurting the sentiment surrounding the Eurozone's ability to grow. The ongoing disagreements between the Italian government and the ECB regarding budget deficit are a reminder that the European Commission's stimulus to overcome the sovereign debt crisis has not removed the problem of economic divergence between economies of the single currency. This could pressure the ECB to take a more cautious stance on monetary policy compared to the plans it had set previously this year. That said, there are beliefs that the ECB is set to reduce quantitative easing and the concerns over Italy and Brexit are not enough to alter the ECB's message to the markets. As the Euro is starting to see the effects of the tensions within the Eurozone, the US Dollar is managing to regain some consumer confidence as it is seen as a safe haven amid the Italian and Brexit uncertainties. The Canadian Dollar, on the other hand, continues to rise as consumer confidence is backed by the Bank of Canada's decision to increase interest rates as expected, which boosts the perception of a strong economy. Looking ahead, the day is likely to be dominated by the latest rate decision from the ECB, with Draghi and co expected to keep rates unchanged. With fears remaining over how the current standoff between the EU and Italy will resolve, markets will be expecting a cautious approach from the bank. Markets will also be looking out for the German IFO business climate figure. In the US session, the release of core durable goods and the latest trade balance figures will provide some volatility for the greenback. However, many of the US traders will instead look towards the release of earnings data from the likes of Amazon and General Electric as a core driver of sentiment. South Africa: Precious metal prices have gained overnight on some safe haven demand. Base metals trade slightly lower this morning. The rand has weakened following yesterdays Mid-Term Budget speech, underperforming its emerging market currency peers. Tencent is down 2.8% in Asia suggestive of a weak start for major holding company Naspers. BHP Billiton is down 4% in Australia suggestive of a negative start for local resource counters. Economic calendar - key events and forecast (times in BST) Source: Daily FX Economic Calendar 9am – German IFO (October): business climate index to fall to 103.6 from 103.7. Market to watch: EUR crosses 12.45pm – ECB rate decision (press conference @ 1.30pm): no change in policy expected. Market to watch: EUR crosses 1.30pm – US durable goods orders (September): forecast to fall 2.3% MoM overall, and rise 0.3% MoM excluding transportation orders. Markets to watch: US indices, USD crosses 3pm – US pending home sales (September): sales to fall 1.4% MoM. Market to watch: USD crosses Corporate News, Upgrades and Downgrades Lloyds saw a fall of 0.5% in underlying pre-tax profit for Q3, to £2.07 billion. Net income was up 2% to £13.4 billion. BT has appointed Philip Jansen from Worldpay as CEO, taking over on 1 February 2019. WPP suffered a 0.8% fall in revenue for Q3, to £3.758 billion, while nine-month reported revenue was down 1.6% to £11.25 billion. Steinhoff International The Company announced on 5 October 2018 (the “5 October Announcement”) that its subsidiary Mattress Firm, Inc. (together with its U.S. subsidiaries, “Mattress Firm”) was taking steps to implement a pre-packaged plan of reorganization through the voluntary filing of cases under Chapter 11 of the US Bankruptcy Code (the “Mattress Firm Filing”). In conjunction with the Mattress Firm Filing, Mattress Firm also secured certain financing arrangements that come into effect upon completion of the implementation of the plan of reorganization and Mattress Firm’s exit from the Chapter 11 proceedings that are intended to support its business going forward. Air Liquide upgraded to add at AlphaValue Segro upgraded to add at AlphaValue Anglo American upgraded to buy at SocGen Rolls-Royce upgraded to buy at Oddo BHF Orion downgraded to reduce at Inderes Rio Tinto downgraded to hold at SocGen Telia downgraded to underweight at Barclays Valeo downgraded to neutral at MainFirst 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.
  23. DanielaIG

    Does volatility affect IPOs?

    The music entertainment arm of Tencent, which has 800 million users across a variety of platforms in China, had originally planned to go public in the United States imminently. The IPO was initially set to launch as soon as this week but has now reportedly been delayed because of the recent global sell-off. It is not the first company to pull out or postpone an IPO in the recent weeks, and whilst Tencent have declined to comment on the decision, it’s likely to be on the back of volatility seen in the equity markets. Companies prefer stable market conditions to launch their IPOs because they are more likely to be able to correctly predict their valuation and generate the required funds. They usually have a set figure they are trying to raise and offer shares accordingly. If market conditions are stable, companies are more likely to be able to predict if their target value is likely to be raised. In volatile markets, like the one experienced last week, market perceptions on financial stability and future economic conditions start to show In volatile markets, like the one experienced last week, market perceptions on financial stability and future economic conditions start to show. If the most important stock indices suddenly drop, there is a consensus that future economic stability might be in jeopardy. Company’s futures are questioned and therefore the perception of such are hindered. If investors have doubts about the future of a company’s operations and earnings capacity, they are less likely to devote a part of their capital to such company. Volvo (owned by the Chinese multinational automotive company Geely) have also recently backed out of an IPO, stating that the ongoing trade wars are to blame. Volvo exports vehicles from China to the US and is therefore at the centre of the tariffs to be imposed by the US government on Chinese goods. The reasoning is clear, tariffs on their car exports are going to affect the company’s ability to generate earnings. Therefore, investor’s sentiment towards Volvo will have worsened, meaning that if the company launches an IPO, the value they will place on the shares will be lower. So why did Aston Martin decide to go forward with its IPO earlier this month? So why did Aston Martin decide to go forward with its IPO earlier this month? Well, the primary reason is the fact that they are a UK based company, meaning that they are not at the centre of the trade wars currently taking place between the US and China. This does not mean that they are free from turmoil, as worries over Brexit and US tariffs on EU cars are still concerning to investors. What also helps is the diversification seen on their order book. Whilst the UK remains their biggest market seeing 30% of sales, mainland EU sees 25%, with APAC and the US seeing 24 and 20% respectively. Geographically diverse revenue streams should have helped dampen these worries, resulting in Aston Martin making its market debut on the 3rd of October. We didn’t see that on IPO day, with investors less than willing to match the valuation. The share price has been moving down from its initial opening price of £19, shedding over 20% in the first couple of weeks trading. Not a great result. When we look at volatility vs the number of IPOs over a 15 year period we can see a correlation between the two. Of course you’ll have outliers, and whilst a company can benefit from launching in a volatile market, generally the lack of uncertainty and an increase in volatility reduces that. Souce: Renaissance Capital When we look at the specific case surrounding Tencent Music, we can see that Tencent Holdings dropped with the rest of the market on Thursday, from around 286 to 268. On a longer time frame Tencent have come off nearly 18% in October alone, and whilst some of that price action has recovered it does beg the question: is it really a good idea to launch your IPO when your market value has dropped so suddenly? What if the opposite happened, would it be more favourable to launch an IPO if your share price has suddenly risen? Source: IG Dealing Platform A clear strategic roadmap, a realistic valuation, and an accurate financial forecast performance all rely on a calm landscape Put simply there is still volatility in this situation, and there is a lot of movement going on in the market. Predictions on how to accurately value a company, irrespective of buy side or sell side volatility, are far harder, making an IPO far less likely. There are a number of IPO guides out there which can make for interesting reading, and a very good blog post from an ex-president of NYSE Group, Tom Farley. Whilst he does lay out obvious requirements such as having the right executive team on board, a good business case for going public, and good audit processes, a number of other factors come down to accuracy and forward looking speculation. A clear strategic roadmap, a realistic valuation, and an accurate financial forecast performance all rely on a calm landscape. All of these things become exceptionally harder during times of high volatility. With the recent spikes in the VIX there’s an argument that says companies should hold off on their IPO. With that said each new proposed listing should be viewed on a case by case basis. You can register your interest for upcoming IPOs with IG to make sure you’re kept in the loop here. https://www.ig.com/uk/investments/share-dealing/ipos Any questions, please feel free to add them below.
  24. The Dow Jones continues its tumble, losing more than 1,300 in two days, as worries over interest rates and trade barriers continue. The S&P dropped 2%, bringing its October losses to 6% The sell off in the US also saw sell offs in Europe, with FTSE down 1.9%, DAX 1.3%, CAC 1.8% and EU STOXX 1.95%. The VIX rose almost 9%, reaching it’s highest levels since February this year Despite rising interest rates and a booming economy, bank stocks are trading lower, reaching bear market, ahead of earnings reports. XRP and Etherum lead the cryptocurrency downfall which has lost $6 billion in a day. Gold hits its highest price in two months on Thursday after a rough 6 months. As a typical safe haven asset, people have turned to gold in the last few days as world stocks tanked. Despite the ongoing trade wars with the US, China has reported a trade surplus of $34.13 billion in September, which economists believe is due to increase orders before the tariffs are enforced, which is likely to have an impact on the months to come. Asian overnight: A degree of recovery has been seen in Asian markets, with a general rebound in risk appetite. US markets were more mixed, but futures have begun ticking higher ahead of bank earnings later today. Oil prices also recovered, after suffering sharp losses earlier in the week. Regarding the downfall in cryptocurrencies, although the direct cause is unknown, the recent negative sentiment towards cryptocurrencies from important financial institutions could have led to the downfall. Alternatively, it could be a market triggered sell-off, where people are looking to move cash into safer assets. Meanwhile, BitFinex has suspended fiat deposits and stopped accepting bank transfers despite initial denials. The suspension raises fundemental questions about its operations. "JP Morgan is expected to post a 30 per cent increase in third-quarter profits year-on-year, according to analysts polled by Bloomberg" UK, US and Europe: Dow dropped a further 545 points on Thursday, bringing its 2 day loss to 1300. The S&P dropped 2%, bringing its October losses to 6%. Tech sector is worst performer, losing 4.5%, while financial sector is 2nd worse. Global equity markets are today rebounding from the selloff we have seen this week, rebounding to around 25500 from the market low of around 25000 at the close yesterday. With the underlying global risk catalysts remaining in play, markets will be assessing whether todays move is one which is sustainable or not. Metal prices are modestly lower this morning after staging a rebound yesterday which gained significant traction into the afternoon. The dollar is softer, while the Euro and British Pound are the better performers amongst the majors today as Brexit discussions show signs of progression. Bank Earnings season kicks off today with three big players standing out: JPMorgan, Wells Fargo and Citigroup. Analysts are forecasting that banks will post their highest profits since the financial crisis as they are said to enter a “golden age”, fuelled by rising interest rates. According to the FT, "JP Morgan is expected to post a 30 per cent increase in third-quarter profits year-on-year, according to analysts polled by Bloomberg". Across the broad sector, earning are expected to rise 17.7% and revenue increasing by over 7%. When interest rates increase, banks should have more room to increase the rates they charge on loans, relative to the rates they pay out on deposits; this would allow banks to increase their interest margins. But if the increase in rates is deterring customers and businesses from borrowing, then that would hinder bank profits. This means that, despite the general positive outlook regarding the US economy, there are some investors that are becoming sceptical about how long this continued earnings growth can be sustained. They believed that the reason why banks’ profits have been strong throughout the year has more to do with corporate tax cuts than with rising profitability. One of the biggest worries is a weak loan growth, being led mostly by mortgages. South Africa: The rand has continued to claw back strength. Tencent Holdings is up nearly 7% this morning suggestive of a strong start for major holding company Naspers. BHP Billiton is up 1.3% in Australia, suggestive of a positive start for local diversified resource counters. Economic calendar - key events and forecast (times in BST) Source: Daily FX Economic Calendar 3pm – US Michigan consumer sentiment (October, preliminary): expected to fall to 98.5 from 100.1. Market to watch: USD crosses Corporate News, Upgrades and Downgrades Man Group reported a small rise in assets under management for Q3, to $114.1 billion from $113.7 billion. The firm will establish a new holding company in Jersey in order to help deal with growth in the US. Ashmore saw a 3% rise in assets under management for the three months to 30 September, to $76.4 billion, as clients responded to increased volatility across emerging markets Tiger Brands: the Ekurhuleni Department of Health issued a Certificate of Acceptability to the Company for the Germiston processing facility. This endorses the factory’s standards and operating procedures for the safe production of food products. Production of ready-to-cook products, comprising bacon and frozen sausages, is expected to commence on 12 October 2018. Salami production will also commence on this date. Kvaerner Upgraded to Buy at SEB Equities Siltronic Upgraded to Hold at Berenberg Covivio Upgraded to Add at AlphaValue Paddy Power Upgraded to Hold at Berenberg Magnolia Bostad Downgraded to Sell at SEB Equities 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. 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  25. Following a few questions from clients regarding the surge in Italian bond yields in the last week, I have put together a quick overview of why this has taken place. Bond yields are the return an investor is going to earn for investing its money in government bonds. The better the outlook of a country’s economy, the safer the investment will be and the lower the requested return from investors, hence a lower yield. Therefore, bond yields are inversely related to their price and the perception of strength within a country’s economy. The issue with Italy is the fact that the Italian populist government announced a more fiscally aggressive deficit budget than was anticipated. This budget was out of EU-mandated guides, which spooked investors, as Italy is under enormous pressure to control its financial position because its debt-to-GDP stands at more than twice the eurozone’s permissible limit. If Italy’s spending is not controlled, it could face a Greek-style debt crisis, putting a lot of pressure on the EU to control Rome’s budget indiscipline. Despite an announcement on Wednesday the 3rd of October, where the Italian government gave in to EU pressures and reduced the spending deficit for the next 3 years, the sentiment regarding the safety of the Italian government is still very low. This is evident because the spread between the Italian 10-year bonds and the German 10-years bonds, which act as a benchmark for sovereign risk, rose more than 300 points last week, the highest level since March 2014. This increase in government yields proves that investors are weary of the Italian government’s ability to stick to EU guidelines and believe the Italian economy is very unstable, therefore requiring higher returns to compensate for the uncertainty. I hope you find this piece clarifies the current events, if you have any questions just ask. Feel free to "@" me in your discussions.
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