UK, US and Europe: Looking ahead, the UK services PMI is going to provide the one dominant economic reading from the European session. Coming off the back of two poor readings from the construction and manufacturing PMI surveys, today’s release represents the big one for the pound. The afternoon brings both the Canadian and US trade balance figures into view, at a time where the two sides continue to attempt to put together some form of renewed NAFTA deal. Canada remains in view a little later, with the release of the BoC rate decision expected to bring no change from the committee.
South Africa: The Jse AllShare index looks set to trade weaker this morning as poor economic growth reported adds further negative sentiment to what is risk off global market environment today. Emerging market fears continue to stem from Turkey, Argentina, China and to a lessor extent South Africa at present. The dollar has strengthened further to put pressure on commodity prices, particularly that of precious metals. Tencent Holdings is trading 3.6% lower in Asia, which should see major holding company Naspers following suite. BHP Billiton is down 2.66% in Australia, perhaps a precursor for what to expect from locally listed diversified resource counters this morning.
Economic calendar - key events and forecast (times in BST)
Source: Daily FX Economic Calendar
9.30 – UK services PMI (August): forecast to rise to 54.7 from 53.5. Market to watch: GBP crosses
1.30pm – US trade balance (July): deficit to widen to $46.7 billion from $46.3 billion. Market to watch: USD crosses
1.30pm – Canada trade balance (July): deficit to widen to C$2.3 billion from C$0.63 billion. Market to watch: CAD crosses
3pm – BoC rate decision: no change expected. Market to watch: CAD crosses
Corporate News, Upgrades and Downgrades
Barratt Developments reported a 9.2% rise in pre-tax profits for the year, to a record £835.5 million, while gross margins and the number of new homes completed both rose. It remains confident in the outlook for the housing market. William Hill has formed a partnership with Nevada firm Eldorado Resorts, with the latter becoming William Hill’s exclusive partner in the provision of digital and land-based sports betting. The partnership will cover 13 states where sports betting is legal or betting bills have been tabled. Berkeley Group said that prices and demand remained robust in London and the south-east between May and August, but that the market in London remained constricted by high transaction costs and economic uncertainty. Vodafone Upgraded to Outperform at Bernstein
Antofagasta Raised to Equal-weight at Morgan Stanley
BP Upgraded to Overweight at Morgan Stanley
Zumtobel Upgraded to Hold at Kepler Cheuvreux
Intrum Downgraded to Neutral at JPMorgan
Tele2 Downgraded to Underperform at RBC
Vonovia Downgraded to Hold at Nord/LB
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