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JamesIG

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  1. JamesIG
    Stocks have fallen whilst the dollar remains effected on trade tensions and tariff wars. The AUD has given up gains on GDP data. Despite being the most shorted stock on Wall Street (even ahead of Tesla), Amazon pipped the $1 trillion valuation briefly yesterday as it surpassed the $2,050.27 a share requirement. Its expected that there will be no change in the FTSE 100 for the first time in 12 years today with no individual constituents being upgraded or downgraded. The British construction sector slowed in August as both civil engineering firms and house builders held back from projects. With a reading of 52.9 the IHS Markit PMI figure still shows the sector is growing, but it was much lower than the 55 expected by economists. On Tuesday Mercedes showed how aggressively it was gunning for the top spot in upscale battery car market currently dominated by Tesla as it showcased it's first fully electric car, the EQC. Oil has pulled back over 3% from the highs of yesterday after reports that the impact of a tropical storm in the US Gulf coast won't have as much of an impact as initially expected. Asian overnight: An overwhelmingly bearish session overnight has seen substantial losses throughout Hong Kong (-2%), Chinese (-1%), and Australian (-1%) markets. Much of this pessimism can be attributed to the ongoing fears over US trade relations with Canada and China. With talks between the US and Canada set to resume today, there is little optimism that we will see them reach a deal. On economic front, a surprise boost for the Australian dollar came amid a significant beat on the Q2 GDP figure. An upward revision to the Q1 figure also helped boost sentiment, reflecting an economic outperformance despite ongoing trade fears.
    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
    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. 
  2. JamesIG
    Solid US earnings yesterday support the Asian market and China sees a rebound. GBP has slipped to its lowest level in 11 months on Brexit ‘no deal’ fears. The British heatwave and World Cup has boosted discretionary consumer spending in July according to Barclaycard. Oil gains as US renews sanctions against Iran. Gold gains slightly as lower price levels and the key level of $1200 support seen historically induce buying.  
    Asian overnight: Asian markets were largely in the green overnight, coming off the back of a US session which saw the Dow within touching distance of record highs. Interestingly, Chinese stocks were the main outperformer, with fears over their trade war with the US dissipating for now. The buying is however supported by below average volumes today questioning the sustainability thereof. The one outlier came from Australia, with the ASX 200 in the red despite the RBA deciding to retain their historically low monetary policy stance. Elsewhere, crude prices rose, with the imposition of fresh sanctions on Iran raising rumours that they would seek to close the Strait of Hormuz in retaliation. 
    UK, US and Europe: Looking ahead, there are few events of note worth watching out for, with much of the eurozone data already released from Germany earlier this morning. Coming off the back of yesterday’s weak German factory orders number, this morning has seen a greater deterioration in German Industrial production and trade surplus than expected, in a clear response to the breakdown of trade with the US. Elsewhere, look out for the UK Halifax House Price Index (HPI) and Canadian Ivey PMI releases as the only events of interest. The corporate calendar is a little more interesting, with Walt Disney and Snap earnings due out later today.
    South Africa:  The dollar has given up some of it recent strength this morning, adding a slight rebound in brent and precious metals as well as emerging market currencies, while base metals trade mixed on the day.  BHP Billiton is trading 1.6% lower in Australia suggestive of a softer start for local diversified resource counters. Tencent Holdings is trading 0.25% higher in Asia, suggestive of a marginally positive start for major holding company Naspers. 
    Economic calendar - key events and forecast (times in BST)

    Source: Daily FX Economic Calendar
    Corporate News, Upgrades and Downgrades
    Standard Life Aberdeen saw a 37% drop in first-half profit, to £185 million, while adjusted pre-tax profit was down 8.3% to £478 million. The firm continued to see outflows, but it still plans to push on with cost saving measures. The dividend was raised 4.3% to 7.3p. InterContinental Hotels reported an 8% rise in first-half underlying operating profit, to $398 million, while underlying revenue for the period rose 4% to $875 million. 28 hotels were opened in the year, with a record 7000 new rooms added. Rotorksaid that first-half pre-tax profit rose 12% to £54.7 million, while revenue was up 10.4% to £331 million. Management expectations for the year remain unchanged. Hargreaves Lansdown reported a 10% rise in pre-tax profit to £292.4 million, for the year, while revenue was up 16% to £447.5 million. A special dividend of 7.8p per share will be paid, taking the overall dividend to 40p, up nearly 40% over the year. Nedbank Ltd Headline earnings increased 27,0% to R6 696m, boosted by associate income from ETI's returning to profitability, while our managed operations delivered positive, but slower, earnings growth from a high base. This translated into an increase in diluted headline earnings per share and headline earnings per share of 26,3% to 1 361 cents and 1 387 cents respectively, in line with the 23% to 28% range set out in the trading statement released on 26 July 2018.  CNH Industrial upgraded to add at AlphaValue
    Ferrexpo upgraded to overweight at JPMorgan
    Prosafe upgraded to buy at Fearnley
    William Hill upgraded to neutral at Goldman
    Goldman Sachs maintain neutral rating on Mondi (London) with a target price of 2200p
    Ocado downgraded to underweight at Barclays
    Siemens Healthineers downgraded to hold at HSBC
    Ultra Electronics cut to hold at Kepler Cheuvreux
    Featured Video
    Please note: This 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. JamesIG
    Who has an interest in Emerging Markets? How would you like the opportunity to have direct access to a panel who will be able to answer your questions directly? You can be part of the latest IG chat by leaving your EM question on social media using the #IGEMchat hashtag, or by simply leaving a comment on this blog post. Even if you don't have an account with IG you can leave your comments below! The live broadcast will be available within the dealing platform, or on this page, on Wednesday the 6th of February at 1pm GMT. We would also look to post the video after the event, as well as here. 
     
    What will we talk about?
    The discussion will cover a wide range of topics that relate to emerging market economies, including:
    The emerging markets to watch in 2019 The relationship between EMs and the US dollar The impact of the US-China trade war How to trade EM assets  
     
    Who's on the panel?
    Paul McNamara, Investment Director, GAM Investments: Paul McNamara is an Investment Director, and is the lead manager on emerging market bond and currency long only and hedge fund strategies. He joined GAM Investments following its acquisition of the fixed income and foreign exchange specialist, Augustus, in May 2009, where he started managing most of the funds he runs to date. He joined Augustus (then Julius Baer Investments Limited) in 1997 from the Export Credits Guarantee department of the UK Government Economic Service, where he was an economist. He began his career as a lecturer. Paul holds an MSc in Economics from the London School of Economics and is a CFA charterholder. He is based in London and you can get an insight into his journalistic style via Twitter or on the Financial Times.
    Gavin Serkin, Managing Editor, Frontier Funds Media & Intelligence: Gavin Serkin has been a prominent writer, broadcaster and commentator on emerging markets for over two decades. His book, Frontier: Exploring the Top Ten Emerging Markets of Tomorrow (Bloomberg/Wiley) – an investment travelogue across 10 countries – was acclaimed as a “must read” by the Financial Times. Serkin’s leadership of Bloomberg’s credit markets coverage and his focus on the derivatives that triggered the global financial crisis won him the Society of American Business Editors & Writers’ Best in Business Award and the Society of Professional Journalists’ Deadline Club Award. Subsequently creating and leading Bloomberg’s emerging markets team, Serkin founded Frontier Funds Media & Intelligence in 2015 to help deepen understanding of the opportunities and challenges in developing countries through his own writing, and through constant and proactive dialogue with journalists, investors and leaders.
  4. JamesIG
    Expected index adjustments 
    Please see the expected dividend adjustment figures for a number of our major indices for the week commencing 2nd July 2018. If you have any queries or questions on this please let us know in the comments section below. For further information regarding dividend adjustments, and how they affect  your positions, please take a look at the video. 


    NB: Special Divs are highlighted in orange 
    Special Dividends
    You can see the special dividends listed below. Unfortunately we do not have granular insight on the effect on the index for the index in question, however the below maybe helpful for some. Please note the dates below are the stock adjustments in the underlying, whilst the index div adjustments are taken out the day before on the IG platform at the cash close.
    How do dividend adjustments work? 
    As you know, constituent stocks of an index will periodically pay dividends to shareholders. When they do, the overall value of the index is effected, causing it to drop by a certain amount. Each week, we receive the forecast for the number of points any index is due to drop by, and we publish this for you. As dividends are scheduled, public events, it is important to remember that leveraged index traders can neither profit nor lose from such price movements.
    This 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.
  5. JamesIG
    Asian stocks are broadly higher ahead of the Fed rate decision later today, whilst the NZ dollar is buoyed by higher business confidence.  Trump and Iranian President Hassan Rouhani came to a head at the UN General Assembly on Tuesday with the US President vowing more sanctions against Tehran, whilst President Rouhani suggested that Trump suffers from a "weakness of intellect." Trump is really trying to bring the price of oil into play before the midterms as high oil prices could hit the Republican vote. Oil pulls back after Trump's comments on OPEC whilst bonds and currencies are broadly steady. When it comes to trade wars it may be worth keeping an eye on the USDCNY pair. BCA research and the head of economic research at UBS both speculate that the Chinese renminbi could weaken to 7Rmb against the dollar before the end of the year. According to an internal document reported by reuters, EU negotiators are ready to offer Theresa May a free-trade area in Brexit, however they are adamant that there must be a customs border that will trade less than frictionless. The Argentinian peso, an EM currency which has seen news inches this quarter, slide as much as 5% as the central bank chief quits just three months into the job. Globally IPO’s have slide by nearly 1/5th this year amid geopolitical tensions, whilst money brought into via the process has increased by 10% according to accountancy firm EY. Asian overnight: Asian markets enjoyed a largely positive session, as trade concerns faded despite Trump’s UN speech which heralded an America first approach rather than rampant globalisation. The New Zealand dollar came into favour overnight, gaining ground in the wake of a strong business confidence figure. This despite a deterioration in their trade balance figure, with imports rising and exports shrinking.
    UK, US and Europe: Today sees all eyes turn to the Fed, with the FOMC due to announce their latest monetary policy decision. The simultaneous release of the latest FOMC economic projections should ensure volatility for the dollar and US stocks markets. Apart from the Fed, the European session sees little of note, with new home sales and crude inventories the other numbers to watch out of the US.
    Record breaking divergence between the US equity market and the rest of the world could see a significant movement of money out of Wall Street and into other markets in Europe and Asia. The S&P has gained 9% this year alone and has created the biggest difference between its continued all time highs and the rest of the world putting it at its most extreme levels since 1970. US consumer confidence is at a 17 year high whilst manufacturing activity reached a 14 year high. According to BoA ML analysts, investors have built up a significant level of US equity exposure over the last three years. A mass exodus could see significant movements. This could potentially provides an interesting trade opportunity if the flow into Asia and European markets tips as investors, traders and speculators search for greater returns - the players to keep an eye on however are the institutional investors and money managers. 
    Economic calendar - key events and forecast (times in BST)

    Source: Daily FX Economic Calendar
    3pm – US new home sales (August): expected to rise 2.2% MoM. Market to watch: US crosses
    3.30pm – US EIA crude inventories (w/c 21 September): stockpiles forecast to fall by 480,000 barrels from a 2 million barrel drop a week earlier. Markets to watch: Brent, WTI
    7pm – FOMC decision (7.30pm press conference): the central bank is expected to raise rates to 2.25% from 2%, but this is all but a foregone conclusion, so the market impact will be in their projections for future rate rises, their assessment of the US economy and the impact (if any) from the US-China trade conflict. Markets to watch: US indices, USD crosses
    Corporate News, Upgrades and Downgrades
    SSP said that it expected like-for-like sales in its financial year to grow by 2-3%. Growth in Q4 was similar to Q3, driven by increased passenger numbers.   PZ Cussons expects overall results for the quarter to the end of August were in line with forecasts, as growth in Europe and Asia offset a poorer performance in Nigeria.  AA said that higher callouts due to bad weather and potholes hit pre-tax profit for the first half, which fell to £23 million from £64 million a year earlier.   Boohoo reported a 50% rise in first half revenue, to £395 million, with international revenues now 40% of the total. Sales growth for the full year is now expected to be 38-43%, from a previous guidance of 35-40%.  Bouygues upgraded to overweight at JPMorgan
    Next upgraded to neutral at Goldman
    Randgold upgraded to sector perform at RBC
    Scandic raised to equal-weight at Morgan Stanley
    Deutsche Boerse downgraded to sell at Bankhaus Lampe
    Grammer downgraded to sell at Quirin Privatbank AG
    Kier downgraded to neutral at JPMorgan
    Telenet downgraded to equal-weight at Barclays
    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. 
  6. JamesIG
    Asian stocks have slumped to a 14 month low on the back of China worries. USD edges higher as trade tensions keep markets on edge, whilst oil rises as new production in US drilling stalls. Slightly higher dollar causes gold to fall, along with rate hike views and trade war worries. Asian overnight: Fresh tariff concerns hit Asian markets overnight, with Apple suppliers particularly hard hit thanks to the US president’s tweets regarding the tech giant moving production to the US. Chinese stocks were lower, while Australia was broadly flat and Japan managed a small rise. Equities rebounded in the US after a better jobs report, with strength in wages particularly encouraging for US consumer spending.
    UK, US and Europe: UK trade data is the main event of the morning, while a busier week for retailers kicks off with numbers from Associated British Foods. Expect plenty of focus on Sweden after an indecisive election result there, with the incumbent centre-left government likely to spend the next two weeks trying to form a coalition. 
    South Africa: Global markets are trading mixed this morning with US Index Futures trading marginally higher, while most Asian markets (excluding Japan) are trading lower this morning. The Jse Allshare Index is expected to trade flat to marginally lower om open. The dollar continues to trade firmer and in turn we see commodity prices under marginal pressure this morning. Tencent Holdings is down 0.76% in Asia suggestive of a similar start for major holding company Naspers. BHP Billiton is down 0.32% in Australia suggestive of a softer start for locally listed resource counters. 
    Economic calendar - key events and forecast (times in BST)

    Source: Daily FX Economic Calendar
    9.30am – UK trade balance (July), GDP (July):trade deficit forecast to widen to £2.3 billion from £1.8 billion. GDP to rise 0.1% MoM. Market to watch: GBP crosses
    Corporate News, Upgrades and Downgrades
    AVI Ltd FY18 results showed headline earnings to have increased by 7% from the prior year. Afrox Ltd Interim results showed diluted core headline earnings per share to have increased by 11.5% from the previous year's interim period. Associated British Foods said that its full-year outlook was unchanged, as Primark profits offset lower sugar prices. Sales were down 2% like-for-like at Primark for the year to 15 September.  RPC Group has said that it is in discussions regarding a sale of the company with Apollo and Bain Capital. Aurubis Upgraded to Neutral at Goldman
    Rio Tinto Upgraded to Overweight at JPMorgan
    Norsk Hydro Upgraded to Overweight at JPMorgan
    Nornickel GDRs Upgraded to Overweight at JPMorgan
    Danske Bank Cut to Hold at Kepler Cheuvreux
    Scor Downgraded to Hold at Jefferies
    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. JamesIG
    Asian markets fall for the fourth day and major currencies are generally trading in a tight range.  MSCI Asia-Pacific index down 0.5% whilst Japan's Nikkei (the Japan 225) loses 1%. USD slightly softer going into US Initial Jobless Claims and FOMC minutes later today. Gold is holding steady before Fed minutes, whilst copper and zine are stuck near their one year lows on trade woes. Oil prices fall as Trump slams OPEC on twitter and blames the cartel for rising gas prices. This issue has been raised a number of times over the last few weeks as it could cause a major issue for the 'Trumphouse' going into the November midterms. Meanwhile China's duty on U.S. crude looms. Goldman Sachs are still bullish on Commodities as a whole and believe trade war fears have been overdone. "All of these concerns have been oversold. Even soybeans, the most exposed of all assets to trade wars, is now a buy." Clarification by the FCA on PPI compensation could means UK banks may have to add to the £45bn they’ve already set aside for claims. FMOC later today. Asian overnight: Asian markets traded lower once more, as market sentiment continues to suffer in anticipation of the impending Sino-US tariffs on $34 billion worth of goods. Yesterday’s tweet from Donald Trump calling for lower oil prices has had a knock on effect to the equity markets and tempered some of the gains seen through the week thus far.
    UK, US and Europe: Looking ahead, the focus shifts from the UK to the US, with yesterday’s Independence Day meaning we will see markets on the other side of the Atlantic play catch up with Europe. Appearances from BoE governor Carney and ECB member Mersch will be the highlights for Europe, with markets more focused on the plethora of data points out of the US. ADP payrolls data, composite, manufacturing and services PMI figures in the afternoon pave the way for the latest FOMC minutes. Keep an eye out for the dollar for the impact of the days economic releases, while stock markets will be closely followed for how much they will follow yesterday’s lead in Europe.
    South Africa: After yesterdays public holiday, US futures are trading flat this morning while Asian markets continue to find short term pressure lending itself to a flat to lower start on our local bourse this morning. The dollar is trading relatively flat while commodity prices, which have a relatively large impact on the local SA index, trade mostly lower ahead of the US implementation of trade tariffs on China. BHP Billiton is trading 0.54% lower in Australia furthering the notion that we will see a softer start on locally listed resource counters today. Tencent Holdings is trading 0.5% lower on the Hang Seng, suggestive of a similar start for major holding company Naspers this morning. 
    Economic calendar - key events and forecast (times in BST)

    1.15pm – US ADP employment report (June): expected to rise to 180K from 175K. Markets to watch: US indices, USD crosses
    1.30pm – US initial jobless claims (w/e 30 June): forecast to be 221K from 227K. Markets to watch: US indices, USD crosses
    3pm – US ISM non-manufacturing PMI (June): forecast to fall to 58.2 from 58.6. Markets to watch: US indices, USD crosses
    4pm – US EIA crude inventories (w/e 29 June): expected to see stockpiles fall by 1.6 million barrels. Markets to watch: Brent, WTI
    7pm – FOMC minutes: these will provide further insight into the Fed’s decision to raise rates, as well as the shift on the committee that resulted in the dot-plot suggesting four rate hikes in 2018, from the previous three. Markets to watch: US indices, USD crosses
    Source: Daily FX Economic Calendar
    Corporate News, Upgrades and Downgrades
    China’s ZTE has received a 30 day trade ban relief from Trump. The US provide a third of the components needed by the smartphone manufacturer who have seen a 60% decline in share price wiping off $11bn from the company valuation since the trade war talks.
    Anglo American sees volatility spikes on take over rumours.
    Anglo American Platinum Limited (SA) has accepted an offer from Royal Bafokeng Platinum Limited ("RBPlat") to purchase its 33% interest in the Bafokeng Rasimone Platinum Mine joint venture (“BRPM JV") for a total purchase consideration of R1.863 billion.
    Associated British Foods said its full-year outlook was unchanged, as improvement at Primark is cancelled out by weakness in its sugar division. Group revenue for the 40 weeks to 23 June was up 3% overall, and 2% at actual exchange rates. Primark sales were up 6% on last year, but AB Sugar revenue was 17% lower. 
    Purplebricks suffered an adjusted operating loss of £21.3 million, despite strong growth in the UK and Australia. This compares to a £5.1 million loss in 2017. 
    Glencore has announced a $1 billion share buyback, which will run from today until the end of the year. 
    EasyJet carried 7.9 million passengers in June, up 2.3% from a year ago, while the load factor rose to 95.4% from 94.8%. 
    Aegon upgraded to buy at HSBC
    Bauer upgraded to buy at Kepler Cheuvreux
    Tullow upgraded to overweight at Barclays
    Daimler upgraded to buy at Bankhaus Lampe
    Hapag-Lloyd downgraded to neutral at Citi
    Kappahl downgraded to reduce at Kepler Cheuvreux
    Munich Re downgraded to neutral at JPMorgan
    Soco downgraded to underperform at RBC
    Featured Video from IGTV
    Please note: This information has been prpared 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.
  8. JamesIG
    Trade war continues with EU initiating retaliatory tariffs from tomorrow. 25% will be levied against products from whiskey to jeans and motorbikes. GBPUSD hits 7 month low on fears May will be ousted as PM over Brexit. FTSE index buoyed by a depreciated Sterling.  Disney ups the bid to eclipse Comcast’s $35 a share cash offer for Fox with a $71bn deal, about $38 a share. Trump crumbles to international pressure and signs an executive order stopping the separation of immigrant children from their families. Goldman Sachs looks to expand bitcoin involvement according to COO in a Bloomberg interview. Asian Overnight: Another mixed session in Asia saw Chinese stocks steady themselves after yesterday’s losses despite continued fears over a trade war with the US. Crude remains at the forefront of the market agenda, with weekly US crude inventories falling by the highest amount since January. Meanwhile, a weaker New Zealand GDP figure sent NZDUSD lower overnight.

    UK, US and Europe: Looking ahead, the BoE rate decision is certainly the main event of the morning session, while the SNB monetary policy announcement will also grab some headlines. Look out for FTSE / Sterling correlation. The weaker the Queens pound, the higher the overseas earnings are for companies when they convert back into pounds. The BoE announcement is likely to cause some GBP volatility so make the appropriate risk management alterations to combat this. US Philly Fed manufacturing index, and unemployment claims round off the day in the US.
    South Africa: The US Dollar has strengthened to weigh on commodity prices, in particular that of precious metals. The rand has resumed weakness as a result and we expect financial counters to bear the brunt of initial weakness. BHP Billiton is trading 0.5% higher in Australia which combined with a softer rand could help local diversified resources find a bid this morning. Tencent Holdings is down 2.5% on the Hang Seng, suggestive of a soft start for major holding company Naspers. 
    Economic calendar - key events and forecast (times in BST)

    12pm – BoE interest rate decision: no change in rates expected, but watch for any changes in the voting pattern from the last vote which was 7/9 in favour of leaving rates unchanged. Market to watch: GBP crosses

    1.30pm – US Philadelphia Index (June), initial jobless claims (w/e 16 June): Philly Fed index expected to fall to 28 from 34.4, initial jobless claims expected to rise to 223K from 218K. Markets to watch: US indices, USD crosses

    9.30pm – Fed publishes bank stress test results: the US central bank will issue the results of these tests, so bank and other financial stocks will be in focus. Market to watch: US bank stocks
    Source: Daily FX Economic Calendar
    Featured video: What is scalping?
    Corporate News, Upgrades and Downgrades
    Dixons Carphone said that pre-tax profit for the full year was down 23.6%, to £382 million, while like-for-like revenue rose 4%. Slower growth in the UK and Ireland was blamed for the weaker performance.  Saga traded in line with forecasts in the four months to 31 May 2018. Saga-branded retail insurance policies were up 1% year-on-year.  Lloyd’s Banking Group announce hundreds of job cuts yesterday citing a change in customer behaviour. Tesla files lawsuit against Martin Tripp, the former employee who allegedly orchestrated a hack and data breach of Tesla operating software. Essity upgraded to overweight at Morgan Stanley
    Nornickel GDRs upgraded to buy at Citi
    Peab upgraded to hold at DNB Markets
    Rio Tinto upgraded to buy at HSBC
    Euronext downgraded to equal-weight at Barclays
    Hypoport downgraded to neutral at Oddo BHF
    Veolia downgraded to hold at Jefferies
    Virgin Money cut to neutral at JPMorgan
    Please note: This 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.
  9. JamesIG
    China announces a new round of trade talks with the US.  Asian shares, however, hit fresh one year lows on fears of an economic slowdown and the continued Turkish lira volatility. Tencent's earnings shock really weighs on investor sentiment. Amazon is said to be considering UK insurance comparison site. Bitcoin holds above the crucial $6000 mark as crypto traders eye possible bullish reversal. UK retail sales and Canadian ADP figures are the ones to look out for today. Asian overnight: A somewhat calm session overnight saw a slowdown in the recent rate of decline, with the ASX 200, Shenzhen composite, and Nikkei 225 all trading flat. The losses did continue for the likes of the Topix and Hang Seng, but even they were relatively moderate in comparison with recent moves. News that there will be a resumption of trade talks between the US and China authorities at the end of the month, is helping provide some reprieve for equity markets, whilst the dollar is trading marginally lower.
    The breakdown in relations between Turkey and the US remains a key concern, yet with the lira seemingly stabilising over the course of the week, it seems the measures being brought in by the Turkish have held arrest its decline for now. Data-wise, Japanese trade balance moved into a deficit, while a mixed Australian jobs report saw a fall in unemployment overshadowed by the first negative employment change figure in more than a year.
    UK, US and Europe: Looking ahead, the UK retail sales release will ensure that markets will remain focused on the pound, following the recent jobs and inflation numbers. Make sure to look for the year-on-year figure given the volatility of monthly retail sales numbers. Also keep an eye out for eurozone trade balance data this morning. In the afternoon, the Canadian ADP jobs number in one of a handful of tier two releases, including the building permits, housing starts and Philly Fed manufacturing index from the US.
    South Africa: The rand is off its worst levels from yesterday although remains depressed after comments from Moody's Investor Relations yesterday. The ratings agency has expressed concern about the country's pace of fiscal consolidation as expectations for economic growth are lowered and the public sector wage bill rises. BHP Billiton is down 2.55% in Australia and Tencent Holdings is down 3.1% in Asia. This is not expected to fully translate into losses on our local bourse today, in lieu of a lot of the declines having been priced in yesterday. 
    Economic calendar - key events and forecast (times in BST)

    Source: Daily FX Economic Calendar
    9.30am – UK retail sales (July): expected to fall 0.3% MoM and rise 2.9% YoY, from -0.5% and 2.9% respectively. Markets to watch: GBP crosses

    1.30pm - US housing starts & building permits (July), Philadelphia Fed Index (August), initial jobless claims (w/e 11 August): permits to rise 1% MoM and starts to be 5% higher MoM. Philadelphia index to fall to 22 from 25.7. Claims to rise to 217K from 213K. Markets to watch: US indices, USD crosses
    Corporate News, Upgrades and Downgrades
    Kingfisher reported a 3.4% rise in sales for the second quarter, to £3.26 billion, while like-for-like sales rose 1.6%. A weak performance in France hit overall growth.  KAZ Minerals said that pre-tax profit rose 48% to $355 million for the first-half, while revenue was up 22%, supported by higher average copper prices and increased copper sales.   Rank Group reported a 7.9% fall in operating profit, to £20.9 million for the full-year, and warned that current trading was proving difficult due to the warm weather seen in the six weeks to 12 August.   Axa upgraded to buy at Bankhaus Lampe
    DNA upgraded to buy at SEB Equities
    Saipem upgraded to hold at Jefferies
    JCDecaux upgraded to buy at Berenberg
    AstraZeneca downgraded to hold at Jefferies
    Informa cut to equal- weight at Morgan Stanley
    Leoni downgraded to hold at Quirin Privatbank
    Petrofac downgraded to hold at Jefferies
    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.
  10. JamesIG
    Asian overnight: A wildly varied session overnight saw losses for the likes of the Nikkei 225 and ASX 200 counterbalanced by strong gains in the Shenzhen composite (2%) and Hang Seng (1.3%). The euro gained sharply overnight, as an agreement at the EU summit over immigration was seem to appease hard line anti-immigration leaders, and crucially ease the pressure on Angela Merkel. On the data front, a raft of Japanese economic figures saw improved inflation, unemployment, industrial production, and housing starts.

    UK, US and Europe: Looking ahead, the economic calendar looks to set up a busy day, with the release of the final UK GDP reading, alongside the flash eurozone CPI reading for June. With yesterday’s GDP reading from the US was revised lower from 2.2% to 2.0%, there is going to be of particular interest for this UK figure. Meanwhile, with the ECB heavily reliant upon the trajectory of inflation, traders should be watching out for the CPI figure as a driver of euro volatility. In the US session, watch out for the release of US personal income and spending, which will be hugely important given the influence of domestic consumption as a driver of US growth.
    Economic calendar - key events and forecast (times in BST)


    Source: Daily FX Economic Calendar
     
    Corporate News, Upgrades and Downgrades
    Serco said that it expects underlying trading profit for the first half to rise by 20%, but that revenue for the period would be around £1.35 billion, down from £1.51 billion a year earlier.  
    BAE Systems has won a $35 billion contract to provide nine new frigates for the Royal Australian Navy. Production is expected to begin in the early 2020s. 
    Allianz raised to overweight at JPMorgan
    BAE upgraded to neutral at JPMorgan
    Swatch upgraded to buy at Citi
    Ageas downgraded to hold at SocGen
    Amer Sports downgraded to reduce at Inderes
    Bpost cut to equal-weight at Morgan Stanley
    Hunting cut to underweight at Morgan Stanley
    Please note: This information has been prpared 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.
  11. JamesIG
    Asian shares gain on US - China trade talks, whilst USD dips. Rating agency Fitch warned that the chance of a Brexit no deal is a ‘growing possibility’, and uncertainty is so great that it’s impossible to accurately predict a likely outcome. Reports that Amazon is looking to launch its own comparison site sent ripples through the UK listed rivals moneysupermarket, gocompare, and confused.com owner Admiral. Aftershocks of World Cup fever and the good weather are seen in rising UK retail sales (up 0.7% in July), a boost to home and garden DIY sales for B&Q, and better profit projections for Carlsberg. Oil prices slip amid fears over global economic growth. US Baker Hughes to keep an eye on later today.  Asian overnight: Asian markets gained ground thanks to subsiding trade war concerns, while worries about the Turkish situation also eased for the time being. It looks like the US and China are preparing to talk, and this should help equities to trade in a more optimistic fashion. US markets staged an impressive rebound yesterday, but once again Europe was left trailing behind, repeating the dominant theme of the year so far. The rebound has been catalyzed by optimism over the revisiting of trade talks between China and the US at the end of the month. The trade war rhetoric does still remain a relevant theme in the market place and is still expected to cause further market volatility going forward, as is the economic crisis in Turkey and its possible contagion effects.
    UK, US and Europe: Eurozone CPI dominates the first part of the day, while Canadian CPI and then Michigan confidence data are expected later today. With little corporate data on the calendar, investors will watch Tesla stock this afternoon after the New York Times published an interview with CEO Elon Musk.
    South Africa: We are expecting a continued but only partial rebound on the JSE this morning as US index futures and most Asian markets trade firmer today. Tencent has rebounded firmly this morning in Asia, adding 3.38% on the day, suggestive of a positive start for major holding company, Naspers, which carries a 23% weighting in the Top40 index. BHP Billiton is 0.3% lower in Australia suggestive of a flat to marginally lower start for local diversified resource counters. 
    Economic calendar - key events and forecast (times in BST)
    Source: Daily FX Economic Calendar
    10am – eurozone CPI (July):prices to grow 0.1% MoM and 2.1% YoY, and core CPI to be 1% MoM from 0.9%. Market to watch: EUR crosses

    1.30pm – Canadian CPI (July): expected to be 0.1% MoM and 2.4% YoY, from 0.1% and 2.5% respectively. Market to watch: CAD crosses

    3pm – US Michigan confidence index (August): sentiment forecast to fall to 96 from 97.9. Markets to watch: US indices, USD crosses
    Corporate News, Upgrades and Downgrades
    RBS has appointed Kate Murray as interim CFO, to start at the beginning of October, while a search for a permanent replacement for Ewen Stevenson continues.  Global Ports said that it expects full-year figures to be in line with forecasts, after pre-tax losses narrowed to $2.1 million from $6.5 million for the first half.  Victoria Oil & Gas said that second quarter gas sales fell, to 183 million standard cubic feet per day, from 189 million in the first quarter.  Esure upgraded to equal-weight at Barclays
    Glencore upgraded to hold at Liberum
    Henkel upgraded to outperform at MainFirst
    RBS upgraded to buy at HSBC
    BowLeven downgraded to neutral at Arden Partners
    DNO downgraded to hold at DNB Markets
    KSB downgraded to hold at LBBW
    dormakaba downgraded to hold at HSBC
     
    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.
  12. JamesIG
    The US stock market opens from 2:30pm to 9pm London time, which means many UK-based trading companies only allow you to trade these individual stocks up until 9pm (with other regions having restrictions based on their local time zones). We know that many IG clients want to trade outside of these hours, especially over earning season, so we sought to offer you 'extended hours' on many of these major companies. 
     
    Trade the US FANG index 24 hours a day at IG
    This same concept applies for a bespoke IG index, available on the platform under "US FANG", which we now also offer 24/5 trading on. This means that you can take advantage of market movements after the main session closes, and better manage your risk with deal execution all the way up until 1am midweek, and up to 10pm on Friday (UK times - local times will vary). Check your local Help and Support pages for more information.
     
    Where next for the FANG?
     
    US earnings season schedule 2019
    Several major companies release their quarterly figures across similar months every year:
    January and February April and May July and August October and November See below for a list of major companies and the dates of their latest/upcoming earnings announcements.

    * Dates in square brackets [DD/MM/YY] are expected reporting dates; to be confirmed.
  13. JamesIG
    Asian overnight: Sharp declines overnight are pushing the bulls out the way and the overnight session looks to be paving the way for a bearish start to the week in Europe, with circa 2% losses across Japanese and Chinese markets. The Hang Seng market was closed for a bank holiday while the Australian ASX 200 managed to limit the losses. Trade wars are back on the agenda as a key concern for markets, with a European Commission statement against car tariffs making little difference to sentiment for now. Data wise, we saw the Japanese Tankan manufacturing survey fall from 24 to 21, while the Chinese Caixin manufacturing PMI number moved slightly lower, to 51.0 (from 51.1).

    UK, US and Europe: The manufacturing focus remains today, with a host of final manufacturing PMI readings from a host of eurozone countries leading into the initial UK figure for June. With Canadian markets on holiday, the focus is on the US, where once again it is the manufacturing surveys which take precedence.
    South Africa: After strong gains on Friday, the local bourse looks set to open up weaker today after the Asian markets poor performance on Monday. Friday's gains can in part be attributed to quarter end window dressing, although the underlying market pressures of trade war concerns and a flight from emerging markets remain. A strengthening dollar is seeing precious metals, the rand, and oil trading lower this morning. BHP Billiton is trading 0.9% lower in Australia, suggestive of a softer start for local resource counters. The weaker rand is expected to weigh on local banking and retail counters on open. 
    Economic calendar - key events and forecast (times in BST)

    9.30am – UK mfg PMI (June): expected to fall to 53.5 from 54.4. Market to watch: GBP crosses
    10am – eurozone unemployment rate (May): forecast to fall to 8.4% from 8.5%. Market to watch: EUR crosses
    3pm – US ISM mfg PMI (June): expected to fall to 58.3 from 58.7. Markets to watch: US indices, USD crosses
    Source: Daily FX Economic Calendar
    Corporate News, Upgrades and Downgrades
    Tesco has announced a strategic buying partnership with Carrefour, that will involve joint purchasing of own brand products and goods. 
    Meggitt upgraded annual revenue guidance, thanks to a stronger than forecast performance in Q2. Organic revenue growth for the year through December is expected to be 4-6% from 2-4%. 
    Aeroports de Paris raised to overweight at JPMorgan
    Chargeurs upgraded to buy at AlphaValue
    Cloetta upgraded to buy at SEB Equities
    Novo Nordisk upgraded to outperform at Bernstein
    Investec upgrade Capitec Holdings (SA) to buy with a target price of 103400c
    Investec upgrade Impala Platinum (SA) to buy with a target price of 2500c
    Eurofins Scientific cut to reduce at Kepler Cheuvreux
    Infineon downgraded to underweight at Barclays
    Please note: This information has been prpared 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.
  14. JamesIG
    Tuesday the 15th will see a UK Parliamentary vote in the Commons regarding Brexit. There is considerable uncertainty surrounding the vote, however one thing is known: this could make or break Theresa May's Brexit deal. The political uncertainty has flowed over into the financial markets with a number of assets seeing significant volatility. A ratified deal is likely to display stability and confidence resulting in a strengthening GBP, and possibly a short term boost to British stock prices and indices such as the mid-cap FTSE 250. On the other hand, a rejected deal and an increase in uncertainty could signpost a bearish movement. 
     
    We have a live #IGBrexitChat on Wednesday 16th at 13:00 GMT
    IG’s Jeremy Naylor will be live in the studio with Alexandra Kellert from Control Risks and Peter Dixon from Commerzbank AG to analyse the possible effects on the markets. Ahead of the chat, he’ll also be speaking with Ben Habib from First Property Group, and the highlights from that interview will be played during the show.
     
    Submit your questions now
    A key talking point throughout the #IGBrexitChat will be the effect on the markets and how to uncover any trade ideas. We want your questions! Simply submit your questions using the comments section below, either before the chat or over the live show (we'll monitor IG Community and make sure we put your questions to the panel). Add your questions to some of the key areas we'll be covering such as...
    Which markets should you be watching? What direction is EUR/GBP likely to move in? What are the possible effects on the FTSE 100? How can you capitalise on market volatility following the vote? How will the EU react? (The video player below will auto configure 5 minutes before the live show at 13:00 on the 16th Jan)
     
     
    How do I view IGTV live in the platform?
    You can watch the broadcast above, however if you would like to watch in your dealing platform so you can watch the markets throughout the show...
    Click on the top right hand 'notifications' tab Click the IGTV prompt which will go live 5 minutes before the show Move the IGTV player anywhere in your workspace. If you already have the player open the show will start automatically. 
  15. JamesIG
    Expected index adjustments 
    Please see the expected dividend adjustment figures for a number of our major indices for the week commencing 9th July 2018. If you have any queries or questions on this please let us know in the comments section below. For further information regarding dividend adjustments, and how they affect  your positions, please take a look at the video. 

    NB: Special Divs are highlighted in orange 
    Special Dividends
    No special dividends this week.
    How do dividend adjustments work? 
    As you know, constituent stocks of an index will periodically pay dividends to shareholders. When they do, the overall value of the index is effected, causing it to drop by a certain amount. Each week, we receive the forecast for the number of points any index is due to drop by, and we publish this for you. As dividends are scheduled, public events, it is important to remember that leveraged index traders can neither profit nor lose from such price movements.
    This 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.
  16. JamesIG
    MSCI Asia-Pacific index down more than 1% Turkey has doubled tariffs on some U.S. imports, notably alcohol and tobacco, as a response on what is allegedly deliberate US attacks on the Turkish economy. Trade war squabbles continue with China saying that US solar tariffs violate trade rules and lodge a WTO complaint.  Dollar rises to a 13 month high which pressures commodities, forcing gold to hit an 18 month low. Asian overnight: Asian markets traded in the red overnight, with Australian stocks providing the one bright spark over the session, closing out the session in positive territory. Chinese markets were chief amongst the losers once more, with yesterday’s data highlighting a slowdown in growth of several economic metrics. Emerging market stability remains a concern, with the Turkish Lira declining against the greenback as markets shift into the dollar as a safe-haven play.
    Ongoing trade tensions and emerging market fears (induced by the crisis in Turkey) are among the key themes in the market place right now. The dollar has resumed its strengthening trend and in turn we are seeing metal prices under pressure, with gold now trading well below $1200/oz and platinum trading below $800/oz.
    UK, US and Europe: European trading is likely to be lessened in volumes today, with French and Italian markets respecting a national holiday. However, the UK remains the centre of focus, with the latest inflation data released this morning. Market expectations of an upward shift would put further pressure on the Bank of England, despite the recent rate hike. The US focus will be upon the release of retail sales and industrial production figures, alongside the empire state manufacturing survey. Crude traders will also be keeping a close eye on the inventories data released later in the day.
    South Africa: The rand has also started to weaken after clawing back some strength yesterday. Tencent Holdings is trading 3.3% lower in Asia amidst a selloff in technology stocks and news that Chinese regulators halted the approval of game licenses. Tencent Holdings is also set to release results today. Naspers, a major holding company of Tencent, is expected to trade lower in lieu.  
    Economic calendar - key events and forecast (times in BST)

    9.30am – UK CPI (July): expected to be 0.2% MoM and 2.6% YoY, from 0% and 2.4% respectively. YoY core CPI to be 2.2% from 1.9%. Market to watch: GBP crosses

    1.30pm – US retail sales (July): forecast to grow 0.3% MoM from 0.5%. Markets to watch: US indices, USD crosses

    3.30pm – US EIA crude inventories (w/e 10 August): forecast to see stockpiles rise by 750,000 barrels, from a 1.35 million barrel drop a week earlier. Markets to watch: Brent, WTI
    Source: Daily FX Economic Calendar
    Corporate News, Upgrades and Downgrades
    Balfour Beatty said that first-half pre-tax profit rose to £50 million from £29 million a year ago, but total revenues dropped to £3.22 billion from £3.54 billion. Revenue is expected to be flat in the second half of the year.  Admiral reported a 9% rise in first-half pre-tax profits, to £211 million, while turnover was up 14.5% at £1.7 billion. More home insurance policies helped drive the performance, while the motor insurance business saw an 11.3% rise in profits to £249.5 million.  Amundi upgraded to overweight at Morgan Stanley
    Mitchells & Butlers upgraded to buy at HSBC
    Esure upgraded to hold at Berenberg
    Greene King upgraded to hold at HSBC
    Bayer downgraded to hold at Jefferies
    Valeo downgraded to hold at HSBC
    Curetis downgraded to neutral at Ladenburg Thalmann
    Leifheit downgraded to sell at Berenberg

    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.
  17. JamesIG
    Expected index adjustments 
    Please see the expected dividend adjustment figures for a number of our major indices for the week commencing 8 Oct 2018. If you have any queries or questions on this please let us know in the comments section below. For further information regarding dividend adjustments, and how they affect  your positions, please take a look at the video. 

    NB: All dividend adjustments are forecasts and therefore speculative. A dividend adjustment is a 
    cash neutral adjustment on your account. Special Divs are highlighted in orange.
    Special dividends 
    You can see the special dividends listed below. Unfortunately we do not have granular insight on the effect on the index for the index in question, however the below maybe helpful for some. Please note the dates below are the stock adjustments in the underlying individual instrument, whilst the index div adjustments are taken out the day before on the IG platform at the cash close.
    Index
    Bloomberg Code
    Effective Date
    Summary
    Dividend Amount
    UKX
    BDEV LN
    11/10/2018
    Special Div
    17.3

    How do dividend adjustments work? As you know, constituent stocks of an index will periodically pay dividends to shareholders. When they do, the overall value of the index is affected, causing it to drop by a certain amount. Each week, we receive the forecast for the number of points any index is due to drop by, and we publish this for you. As dividends are scheduled, public events, it is important to remember that leveraged index traders can neither profit nor lose from such price movements.
    This 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. JamesIG
    Asian session solid on reduced trade war fears. UK equity markets follow suit, along with a strong bidding war emerging for Sky, giving a green day for the FTSE yesterday and a positive start to the day today.  However data from China today showing a record trade surplus risks further inflaming trade tensions.  Trump is visiting the UK and has said that PM May is executing Brexit incorrectly. Trump's comments suggest May's Brexit plan is likely to kill hopes of a US trade deal. Brent crude sees it's biggest decline in 2 years, dropping as much as 6.9% yesterday. Earning season is kicking off in the US. Featured IGTV video below.  Asian overnight: Trade fears continue to recede, as they have done ever since Tuesday night’s brief panic, with a solid session from Asian markets following on from a good day for US equities.  A softer tone from China and their willingness to resume trade talks with the US is helping a risk on environment as most markets extend near term gains at present. While global equity markets are trading mostly firmer overnight, China's Shanghai Composite has given up 0.4% in early trade. Trade balance data from the region saw a larger than expected surplus realised as exports grew while imports slowed. A new record high for the Nasdaq confirmed the strength of this market, representing an interesting ‘safe haven’ from trade concerns. Australian stocks bucked the trend however, as financials dropped 0.7% to see the index drop 0.3% overall.
    Brent crude has seen it's biggest decline in 2 years dropping as much as 6.9% yesterday, a huge move for the black gold, on the back of Libya's state owned oil company saying that it is planning on increasing supply to match the current demand increase. They have also said they are looking at opening all four export channels that have been closed for the last month. This comes on the back of significant worries for energy traders with the Trump tariffs constantly knocking on the door, increasing fears that a knock on to global growth is just around the corner. Today sees the weekly Baker Hughes rig count from the US which is worth keeping an eye on.
    UK, US and Europe: President Trump has been causing mayhem in Europe already this week, and now he brings his special brand of magic to the UK. Having dined with the PM last night, today he is in the papers decrying her Brexit deal, setting us up for a fascinating press conference. The economic calendar is sparse today, but US earnings season gets underway in earnest with the release of bank earnings from Citigroup, JPMorgan and Wells Fargo.
    South Africa: The Jse AllShare index is expected to open up modestly firmer this morning in line with the mostly positive short term global market sentiment. The rand has clawed back further strength against the majors, which should aid initial gains on local banking and retail counters. BHP Billiton is down 0,7% in Australia suggestive of a softer start for local diversified resource counters. Tencent Holdings is trading more or less flat in Asia, suggestive of a flat start for major holding company Naspers. 
    Economic calendar - key events and forecast (times in BST)

    3pm – US Michigan consumer confidence index (July, preliminary): forecast to fall to 98.1 from 98.2. Market to watch: USD crosses
    Source: Daily FX Economic Calendar
    Corporate News, Upgrades and Downgrades
    Workspace Group has seen lettings fall 5% in Q1, though enquiries have risen. Three refurbishment projects completed in June, and six more are expected in this financial year.  DCC said that Q1 profits were in line with expectations, and that it continues to expect profit o be weighted towards the second half of the year. It has also acquired two firms, Stampede and Kondor, with a combined enterprise value of £110 million.  Experian has started the year well, in line with forecasts, with overall revenue growth of 10% in Q1 (at constant exchange rates).  Ashmore saw assets fall $2.6 billion to $73.9 billion for the quarter to 30 June. Despite net inflows, a seasonal slowdown and a stronger US dollar had hit emerging markets hard.  Dawn (SA)  Revenue for FY18 declined by 19/1% to R3.5bn. In H1 F2018 revenue declined by 19,8% and in H2 F2018 revenue declined by 18,3%. Volumes in F2018 declined by 19,1% and price inflation remained flat. Diageo upgraded to buy at Goldman
    Evraz upgraded to buy at Renaissance Capital
    IMI upgraded to buy at HSBC
    Norwegian Air upgraded to buy at SEB Equities
    Featured Video from IGTV
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  19. JamesIG
    US equity markets traded firmer overnight whilst Asian markets, for the most part, trade lower this morning Fed rate hike and FOMC meeting later today seems priced in US tariffs on Chinese goods reiterated by Washington Bitcoin falls to a 2 and a half month low on regulatory concerns  PwC facing a £10m fine over their poor BHS audit Tesla cuts 9% of staff with a refocused goal of profitability UK, US and Europe: A mixed affair in Asia saw gains in Japan overshadowed by losses across China, Hong Kong, and Australia. The boost provided by yesterday’s Trump-Kim summit seems to have been short-lived, with markets now turning their attention to the central banks and the continued trade tariff chat. First up it is the Fed, with the ECB and BoJ following in the final two days of the week. The dollar has continued to firm ahead of this evenings FOMC meeting and rates announcement and in turn, commodity prices continue to find short term pressure. Trade friction conitunes between American and China after Washington stated it is planning to release a list of $50bn worth of Chinese imports subject to a 25% tariff.
    In Europe there is likely to be a significant degree of interest around the UK CPI figure, with headline inflation expected to remain steady despite the wider trend of falling CPI over the first six-months of the year. Also keep an eye out for the employment change and industrial production figures from the eurozone. In the US, crude inventories gives way to the latest Fed rate decision, where Powell is expected to preside over yet another hike. Crucially, we also see a batch of economic forecasts to accompany that decision, with markets largely looking towards the dot plot to see if there is any shift towards expecting 4 instead of 3 hikes in 2018.
    South Africa: The rand has weakened significantly as a result of a strengthening dollar. While our local bourse is expected to trade more or less flat leading into the US data tonight, locally listed banking and retail counters are expected to see early pressure on the back of the currency move. BHP Billiton is trading 1.3% lower this morning suggestive of a softer start for diversified resource counters. Tencent is trading more or less flat on the Hang Seng suggestive of a similar start for locally listed Naspers. 
    Economic Calendar (times in BST)


    Source: Daily FX Economic Calendar
    Corporate News
    Mulberry posted a fall in annual profit and said conditions had worsened in the early part of the new financial year. Pre-tax profit fell 8% to £7.5m, but revenue rose 1% to £169.7m. 
     
    Please note: This 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.
     
  20. JamesIG
    Asian equity markets have crept slightly higher overnight following on from a firm Wall Street finish yesterday. Apple gains 4% on good results yesterday as it races with Amazon to be the world's first trillion dollar company. Turkey sharply increased their inflation forecast yesterday to 13.4% just a week after keeping interest rates on hold. Bitcoin pulls back to a one week low, however still ends the month about 20% higher MoM. Oil has pulled back after industry data showed US stockpiles rose unexpectedly.  Tesla are set to release their Q2 results about one month after announcing it met its most recent target of building 5,000 Model 3's /week. The U.S. Federal Reserve's Federal Open Market Committee (FOMC) announces its decision on interest rate at 19.00 BST. Asian overnight: Japanese markets were the one outlier overnight, as the promise of continued loose monetary policy from the BoJ earlier in the week continues to have a toll on the yen and Japanese stocks. Uncertainty continues to rein amid a week of hugely significant economic and corporate releases. Oil prices have been falling back amid speculation that sanctions on Iranian exports could be avoided. On the data front, New Zealand posted weaker jobs data, with a slight fall in the employment change figure (0.5% from 0.6%) accompanied by a slight rise in unemployment (4.5% from 4.4%).
    UK, US and Europe: US Index futures trade firmer this morning while Asian markets trade mixed. The US dollar has firmed after better than expected consumer confidence data was released yesterday afternoon. Looking ahead, the beginning of a new month brings the usual trio of UK PMI readings, with the manufacturing figure kicking things off today. There are a host of eurozone PMI surveys, but for the most part they are revisions rather than the preliminary reading in the UK.
    That PMI theme will carry into the US session, with the Canadian and US ISM manufacturing PMI surveys released later on. We also see the first of the major data points from the US, with the ADP payrolls figure ahead of this evening’s FOMC meeting. Crude markets will also expect volatility, with the release of the US crude inventories data earlier on in the afternoon. On the corporate front, all eyes will be on Tesla as Elon Musk hopes to prove the firm can be profitable going forward.
    South Africa:  The rand while weaker against the strengthening US dollar, has underperformed its emerging market currency peers following news that ruling party, the ANC had resolved to change the South African constitution in lieu of land redistribution without compensation. Rand hedge industrial counters are expected to outperform on the Jse this morning. While a stronger dollar has weighed on commodity prices, suggestions that China US trade talks will resume have provided some reprieve.  BHP Billiton is up 0.63% in Australia and Tencent Holdings trades 0.5% higher in Asia, suggestive of a positive start for local resource counters and Naspers. 
    Economic calendar - key events and forecast (times in BST)

    Source: Daily FX Economic Calendar
    Corporate News, Upgrades and Downgrades
    Direct Line saw a decline in operating profit (-1.5%) and pre-tax profit (-13.9%) in H1, driven predominantly by higher weather-related claims. Normalised for weather, operating profit was slightly higher compared with H1 2017. Interim dividend of 7p established in line with business growth.  BAE Systems saw a fall in sales (-3%), underlying EBITDA (-6%), and underlying EPS (-2%) for H1 2018, as the firm pushed through a ‘transition earnings year’. Despite this fall in metrics across the firm, they have raised dividends to 9p (from 8.8p) as they look forward to a strong H2. Significant wins on the Australian SEA 5000 and US Amphibious Combat Vehicle programmes, coupled with the launch of the UK Combat Air Strategy, are expected to provide strong momentum going forward. Lloyds Banking Group saw a 23% jump in pre-tax profit to £3.1 billion for the first half of 2018, beating market expectations, while also raising their full-year guidance. This is despite another £460 million worth of PPI claims, taking the total cost of the scandal to £19.2 billion.  Next saw a 4.5% rise in full price sales for the first half of 2018, with online sales growth (+15.5%) far outstripping instore activity (-5.3%). The extended period of sunshine in the UK has helped drive sales of summer products, yet with the possibility that these sales have simply been pulled forward from August, sales and profits guidance remains the same for the year.  ArcelorMittal South Africa Interim results showed Ebitda improved by R2 121 million from a loss of R534 million to a profit of R1 587 million. Standard Chartered upgraded to hold at HSBC
    BHP upgraded to reduce at AlphaValue
    EDF upgraded to equal-weight at Morgan Stanley
    Peugeot upgraded to buy at Citi
    Macquarie upgrades AECI to outperform with a target price of 12800c
    Renaissance Capital upgrade  African Rainbow Mineralsto buy with a target price of 15000c
    Hammerson downgraded to underperform at Jefferies
    Pearson downgraded to neutral at Citi
    Rightmove downgraded to sell at Berenberg
    Worldline downgraded to hold at HSBC
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    Please note: This 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.
  21. JamesIG
    Oil prices dropped after an industry group reported that U.S. crude inventories rose last week, defying analyst expectations for a significant reduction. Wage growth in Britain is slowing according to new data out yesterday, casting a shadow on the likelihood of a BoE rate hike in August. All eyes should be on UK CPI data later today. Feds Powell said the “best way forward”, despite an impending trade war, was to continue to gradually increase rates. IBM have backed a ‘stable coin’ supposedly pegged to the USD and running on the Stellar blockchain network. You can have your say on which new cryptocurrency IG offer in our community poll. Asian overnight: A mixed bag for Asian markets has seen losses throughout Chinese and Hong Kong indices, while Japanese and Australian markets enjoyed a more positive session. Japanese stocks in particular enjoyed a boost from a weakening yen, with USDJPY reaching a five-month high.
    UK, US and Europe: Last nights positive speech on the US economy by Federal Chair Person Jerome Powell, combined with some better than expected results from the financial sector to help stage a rebound in US equity markets.
    European concerns turn to the UK once more, with the latest inflation data due out this morning. Coming off the back of a somewhat underwhelming UK jobs report yesterday, the market expectations for a strong rise in CPI could be a key determinant of BoE sentiment ahead of their August meeting. Also look out for the eurozone CPI reading, although this is a final revision. In the US, building permits and housing starts push the agenda onto the housing market, yet with Jerome Powell set to give his second monetary policy testimony in as many days, there is a chance he will grab the headlines. With crude price showing significant volatility over the past week, traders should watch for the US crude inventories figure, following the substantial drawdown in stocks announced last week.
    South Africa:  The positive sentiment is echoing into US Futures this morning and expected to translate into our local Index on open as well. The dollar has strengthened to weigh on precious metal prices. The rand has also weakened against the greenback. BHP Billiton is trading 3.29% higher following an upbeat FY18 operational update this morning, with gains expected to be replicated on the company's JSE listing. Tencent Holdings is up 0.3% in Asia, suggestive of a marginally firmer start for major holding company Naspers. Miners of precious metals are expected to underperform our market today on account of the softer pricing of the underlying commodity. 
    Economic calendar - key events and forecast (times in BST)

    9.30am – UK CPI (June): YoY inflation to rise 2.5% YoY from 2.4%, and core CPI to be 2.3% from 2.1% YoY. MoM CPI to be 0.4%, in line with May. Markets to watch: GBP crosses
    10am – eurozone CPI (June): final YoY figure to be 2% from 1.9%, and 0.1% MoM from 0.5%. Markets to watch: EUR crosses
    1.30pm – US housing starts & building permits (June): starts to be down 4% MoM from a 5% rise, and permits to be up 0.7% MoM from a 4.6% fall. Markets to watch: USD crosses
    3.30pm – US EIA inventories (w/e 13 July): stockpiles forecast to fall by 1.9 million barrels, from a 12.6 million decrease a week earlier. Markets to watch: Brent, WTI
    Source: Daily FX Economic Calendar
    Corporate News, Upgrades and Downgrades
    GVC said that net gaming revenues had risen 8% on a constant currency basis, for the first half of the year. Online business grew 20% over the same period. The World Cup and warm weather boosted performance.  Premier Foods said that sales rose 1.7% in the 13 weeks to 30 June, with good performances from the Mr Kipling and Batchelors brands.  easyJet expects headline pre-tax profit to be £550-590 million for the year to the end of September, up from previous forecasts of £530-580 million. Revenue rose 14% to £1.6 billion for the third quarter. Full-year headline costs per seat, excluding fuel, are expected to be 3% higher, from a previous 2% forecast rise, due to higher levels of industrial action.  Aker BP Upgraded to Buy at Norne Securities
    Ascential Upgraded to Buy at Goldman
    Brenntag Upgraded to Buy at Commerzbank
    Proximus Upgraded to Hold at Jefferies
    Bonava Downgraded to Reduce at Kepler Cheuvreux
    De’ Longhi Cut to Hold at Kepler Cheuvreux
    Fresnillo Cut to Sector Perform at Scotiabank
    Schibsted Downgraded to Hold at SEB Equities
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    Please note: This information has been prpared 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. JamesIG
    Stocks pull back in the Asian overnight market after a tepid close of Wall Street last night. Bellwether metals copper and zinc, along with other industrial metals, continue their rally as investors and traders focus on increasing demand rather than US-Sino relations. Rio Tinto announced a $3.2bn share buyback scheme, and whilst the Anglo-Australian miner saw 3.2% gain the ASX didn’t follow suit and ended down slightly. Potential swings on the UK Rio listing on the open. In EM currencies, the SA Rand rallied on Wednesday after consumer price growth slowed according to inflation data. This comes ahead of the rate decision today - one to keep an eye on amid potential volatility. A solid reading on New Zealand’s economic growth GDP figure pushed the NZ dollar higher. US dollar index was down around 0.1%, with the euro trading at around 1.168 USD whilst 10 year treasuries are up around 10 basis points in the last week. US crude inventories saw a three and a half year low yesterday whilst gasoline saw a pullback. Both energies were up on the news and have seen consolidation since. This could be one to watch today for any profit taking or movement on the back of trade talk news. The president of the Financial Action Task Force, the global anti money laundering body, has said he’s optimistic about agreeing a set of standards for AML procedures applied to crypto and virtual currencies. Retail Sales in the UK, US initial jobless claims, and the EU press conference are the macro data areas to look out for today.
    Asian overnight: A much less decisive and convincing session overnight has seen Asian markets largely exhibiting moderate gains in a day that has seen them oscillate around the market open level. The one loser on the session came from Australia, with the ASX 200 falling after a report from the RBA said that in an all-out trade war, the AUD could significantly strengthen. The NZD was one of the strongest currencies of the session, following an improved GDP number of 1% for Q2.
    UK, US and Europe: Theresa May stated yesterday that she will not accept Brexit offers that treat Northern Ireland as a separate customs territory, after the EU proposed to keep the region within its customs union and single market. Further to the Financial Action Task Force statement on cryptocurrencies discussed above, the UK's Treasury Committee has announced that the country could soon implement regulatory reforms for Cryptocurrencies, to address poor security, extreme volatility and excessive anonymity. The proposed aim is to make the UK a legitimate home for crypto trading and become a major trading centre.
    Looking ahead, the UK is back in focus with the release of the latest retail sales number. Volatility over Brexit has been influencing the pound and thus traders should also watch out for any further comments from the UK or EU. In the afternoon, keep an eye out for the US Philly Fed manufacturing index and existing home sales. Meanwhile, the eurozone comes back into play, with consumer confidence and an appearance from Bundesbank President Weidmann later in the day.
    South Africa: Global markets are giving ambiguous signals today for the JSE as US Index futures and Asian markets show a mix off marginal gains and losses this morning. There is little in the way of new news to guide markets today although South African traders and speculators will keep a watchful eye on the Reserve banks monetary policy meeting this afternoon.
    Lending rates are expected to remain unchanged, although there remains a possibility of a marginal rate hike. The rand remains firm leading into the news event. Tencent Holdings is up 0.25% in Asia suggestive of a marginally positive start for major holding company Naspers. BHP Billiton is trading 1.14% higher in Australia, suggestive of a positive start for local resource counters.  
    Economic calendar - key events and forecast (times in BST)

    Source: Daily FX Economic Calendar
    9.30am – UK retail sales (August): sales to rise 0.2% MoM and 2.7% YoY, from 0.7% and 3.5% respectively. Markets to watch: GBP crosses
    1.30pm – US initial jobless claims (w/e 15 September), Philadelphia Fed index: claims to rise to 208K from 204K, while the Philly Fed index rises to 15 from 11.9. Markets to watch: US indices, USD crosses
    3pm – eurozone consumer confidence (September): confidence index to rise to -0.7 from -1.9. Markets to watch: EUR crosses
    3pm – US existing home sales (August): forecast to rise 0.6% MoM from a -0.7% fall. Markets to watch: US indices, USD crosses
    Corporate News, Upgrades and Downgrades
    Rio Tinto has announced details of its $3.2 billion share buyback, combining an off-market tender of $1.9 billion and additional on-market purchases.  Stobart said that passenger numbers at its London Southend airport rose 37% for the first half.   Kier Group reported a 9% rise in underlying pre-tax profit for the full year, to £137 million.   Diageo said that the new financial year had begun well and that performance remained in line with expectations. Heightened exchange rate volatility is expected to hit operating profit for the year by around £45 million.   Aveva upgraded to overweight at Barclays
    Weir upgraded to overweight at Morgan Stanley
    Bayer upgraded to buy at Citi
    Proximus upgraded to buy at Citi
    Essity downgraded to neutral at Goldman
    Nokian Renkaat downgraded to sell at Carnegie
    Telenet downgraded to neutral at Citi
    Telefonica Deutschland downgraded to sell at Bankhaus Lampe
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    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. JamesIG
    The Turkish lira crashes yesterday as the central bank decided to keep rates unchanged despite soaring inflation. The UK housing market looks to remain stagnant as figures released by HMRC showed housing transactions slipped last month by as much as 3%. House sales were down nearly 6% YoY. Housing market data in the US set to release today, so keep an eye out at 12 midday and 3pm for mortgage apps and new home sales figures.  Banking shares continue to gain globally. Metro bank has said profits have quadrupled YoY in the first half, driven by continued strong growth in deposits, whilst UBS gave better than expected results yesterday. There are a number of prominent European banks set to release results this week, so keep an eye out for trade opportunities.  Oil gained yesterday as traders factored in an expected Chinese stimulus package, as well as concerns on the US/Iran tensions which could significantly disrupt oil supplies. For energy traders this would be a story to keep an eye on, along with weekly inventories at 3.30pm. Bitcoin jumps to its highest level since May on reports the SEC is set to approve a crypto ETF. Asian overnight: A mixed affair overnight saw gains in Japan and Hong Kong counterbalanced by losses throughout Chinese and Australian indices. Asian Markets are trading mostly firmer this morning although gains on the  Shanghai Composite are modest and the Australian All Ordinaries Index is slightly lower on the day. Considering the gains seen in US markets off the back of Alphabet earnings-fuelled tech stocks, the underlying momentum for global markets should be positive. The announcement from Chinese authorities that they would raise spending and bring some projects forward certainly provided a boost earlier in the week, yet the effects seems to be waning today. Data-wise, Australian CPI came in as expected, remaining at 0.4%.
    UK, US and Europe: US Index Futures are trading lower this morning to partially offset gains on major US Indices last night. Looking ahead, we look set for a somewhat quiet economic calendar, with German business climate representing the only event of note through the European session. The US session will likely focus on the latest US crude inventories numbers, while new home sales could also figure for some traders. Instead we see a significant impact from earnings, with Facebook, GM, Ford, Boeing, and Qualcomm ensuring that the corporate influence remains elevated.
    South Africa: Asian Markets trading mostly firmer this morning leads to the suggestion that the South Africa Top 40 Index is set to have a relatively flat open today, in what is a relatively quite day of economic news flow. Base metal prices have continued to rebound on optimism that the Chinese government will pursue stimulus measure to help offset the trade war risks to the market place. Precious metal prices are flat on the day. BHP Billiton is up over 2% on the Australian All Ordinaries, suggestive of a positive start for local diversified resource counters, although a firmer rand could temper these gains somewhat. Local banking and retail counters should find the strengthening domestic currency a partial catalyst for gains this morning. 
    Economic calendar - key events and forecast (times in BST)

    9am – German IFO index (July): business climate index to rise to 102.2 from 101.8. Market to watch: EUR crosses
    3pm – US new home sales (June): forecast to fall 2.8% MoM from a 6.7% rise. Market to watch: USD crosses
    3.30pm – US EIA crude inventories (w/e 20 July): stockpiles forecast to fall by 2.7 million barrels, from a 5.8 million increase a week earlier. Markets to watch: Brent, WTI
    Source: Daily FX Economic Calendar
    Corporate News, Upgrades and Downgrades
    Tullow Oil reported a pre-tax profit of $55 million for the first half of the year, from a $348 million loss a year earlier. Revenue was up 15% to $905 million and net debt fell to $3.08 billion. The firm said that it did not yet believe a dividend was appropriate.  Vodafone reported a 4.9% fall in revenue for the first quarter, but annual organic adjusted earnings guidance was left unchanged at 1-5%.  ITV said that first-half adjusted pre-tax profit fell 7% to £354 million, but revenue was 8% higher at £1.85 billion.   AECI Ltd Interim results showed headline earnings per share to have increased by 19% from the prior year's comparative interim period.  Applus Upgraded to Overweight at JPMorgan
    UBS Upgraded to Buy at SocGen
    B&M European Upgraded to Buy at Citi
    Kingfisher Upgraded to Neutral at Citi
    boohoo Downgraded to Neutral at Citi
    BT Downgraded to Sector Perform at RBC
    Peugeot Upgraded to Hold at DZ Bank
    Ryanair Downgraded to Reduce at AlphaValue
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      Please note: This 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.
  24. JamesIG
    BoE raised rates yesterday in a universal vote for a 0.25 percent increase. Apple wins the race to the first trillion dollar company valuation in history closing up 3% on the day, 35c above the required $207.04 a share mark. Yes, that's trillion with 12 zeros as quoted in the title. US dollar at 2-week high as trade war dents confidence. Sonos Inc traded in a range as large as 35% (low to high) in debut IPO. Oil prices steady supported by speculators and traders placing new hedges in the futures market ahead of key US inventory data. Non-farm payrolls today at 1:30pm with an estimate of 192k, previously 213k. Average earnings expected to rise by 0.3%. Unemployment rate expected to drop to 3.9% from 4%.  Asian overnight: Trade fears continue to dominate in Asia, with the Chinese markets leading the losses as markets prepare for a potential raft of tariffs on a further $200 billion worth of Chinese exports to the US. Apple hit $1 trillion market cap yesterday, with the news boosting stocks across many of the region. However, that tech boost failed to translate through to the Asian session. Data-wise, Australian retail sales remained stable at 0.4%, despite expectations of a slight decline. We also saw the Chinese Caixin manufacturing PMI fall to 52.8 from 53.9.
    UK, US and Europe: Looking ahead, today sees the heavy hitters come out on the economic front, with the UK services PMI reading due to bring substantial speculation over the UK economy’s largest sector. This will also have a knock-on effect upon GDP expectations. This PMI theme also carries into the US session, where the ISM non-manufacturing PMI reading comes out for the US economy. However, the biggest event of the day comes in the form of the US jobs report, with markets expecting to see payrolls move slightly lower and earnings to tick higher. On the corporate calendar, watch out for earnings reports from the likes of Berkshire Hathaway, and Kraft Heinz to close out the week.
    South Africa: Gains in US equity markets last night are being tempered by mostly weaker Asian markets this morning, lending itself to the suggestion of a marginally positive start for the local bourse today. The US dollar has firmed to put some pressure on commodity prices, particularly that of gold which nears the psychological $1200/oz mark. The rand has weakened against the majors furthering losses in emerging market currencies, as the suggestion of a constitutional change by the ANC, in lieu of land expropriation without compensation, weighs on investor sentiment. BHP Billiton is down 1.7% in Australia alluding to a softer start for local resource counters. Tencent Holdings is up 2% in Asia, alluding to a similar start for locally listed major holding company Naspers. 
    Economic calendar - key events and forecast (times in BST)

    10am – eurozone retail sales (June): expected to rise 1.7% YoY from 1.4%. Market to watch: EUR crosses

    1.30pm – Canada trade balance (June): expected to see deficit narrow to C$2.05 billion from C$2.77 billion. Market to watch: CAD crosses

    1.30pm – US non-farm payrolls (July): payrolls forecast to fall to 195K from 213K, while the unemployment rate falls to 3.9% from 4%. Average hourly earnings to be 0.3% MoM. Markets to watch: US indices, USD crosses

    3pm – US ISM non-mfg PMI (July): forecast to fall to 59 from 59.1. Markets to watch: US indices, USD crosses
    Source: Daily FX Economic Calendar
    Corporate News, Upgrades and Downgrades
    RBS saw an attributable profit of £96 million in the three months to June, beating pessimistic forecasts of a £741 million loss. This brings first half profits to £888 million. Total revenues for H2 also beat market expectations, coming in £200 million above expectations, at £3.4bn. The firm payed their first dividend since being bailed out by the government, with an interim dividend of 2p per share due once they confirm the size of the US Department of Justice fine. IAG saw a sharp rise in half-year profits after tax and exceptional items, rising to €1.41 billion compared with €607 million. EPS also surged higher, rising to 65.9 cents from 27.5 cents. Total revenue gains were more muted, rising 3.1% to €11.2 billion. Looking ahead, the firm expects to see operating profits rise on a year-on-year basis at current fuel prices and exchange rates. Mondi Ltd Interim results showed basic underlying earnings of 89.2 euro cents per share, up 26% Rolls-Royce upgraded to buy at SocGen
    HelloFresh upgraded to overweight at JPMorgan
    Intesa upgraded to buy at SocGen
    Metro AG upgraded to hold at HSBC
    Macquarie upgrades AECI to outperform with a target price of 12800c
    Renaissance Capital upgrade  African Rainbow Mineralsto buy with a target price of 15000c
    H&R downgraded to sell at DZ Bank
    MorphoSys cut to neutral at Oddo BHF
    Saipem downgraded to hold at HSBC
    Valneva downgraded to reduce at Kepler Cheuvreux
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    Please note: This 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.
  25. JamesIG
    Asian overnight: A mixed session in overnight markets came after the White House pulled plans to restrict Chinese acquisition of US technology, helping ease trade war fears that continue to dominate market sentiment. Interestingly, we still saw Chinese stocks fall, with the Shenzhen and Shanghai composite indices trading within the red. Once again, we saw the Australian ASX 200 gain ground amid a resurgence for crude prices. The Yen was largely flat over the session, with a weak retail sales reading (0.6% from 1.5%) offset by demand for the haven currency. Meanwhile, the RBNZ decided to keep rates unchanged as expected, with no shift in rates expected for some time yet.

    UK, US and Europe: The focus for the European session will be the latest EU summit, where Brexit is likely to remain one of the key topics of discussion, alongside immigration issues which are a thorn in the side of Angela Merkel. The US session sees the final US GDP reading released alongside unemployment claims. However, for the most part markets are likely to instead look to Donald Trump and China for a lead on market bias.
    South Africa: We are seeing a firming US dollar and US Treasury Yields trading while emerging market currencies and commodities (excluding oil) under pressure once again. In turn we are expecting a lower open on the Jse Top 40 Index this morning. Tencent HOldings is 0.3% lower on the Hang Seng, suggestive of a softer start for major holding company Naspers. BHP Billiton on the other hand has extended short term gains which is expectant of a positive start for its local listing in South Africa. 
    Economic calendar - key events and forecast (times in BST)

    Source: Daily FX Economic Calendar
    10am – eurozone business confidence (June): forecast to fall to 1.2 from 1.5. Market to watch: EUR crosses
    1pm – German CPI (June, preliminary): expected to fall to 1.9% from 2.2% YoY. Market to watch: EUR crosses
    1.30pm – US GDP (Q1, final), initial jobless claims (w/e 23 June): growth expected to be 1.2% YoY and 0.1% QoQ. Jobless claims to rise to 219K from 218K. Markets to watch: US indices, USD crosses
    Corporate News, Upgrades and Downgrades
    JD Sports said that it continued to be confident about the outlook for the current financial year. Further expansion, with emphasis on new international stores, suggest the group is on track to meet full-year expectations.  
    Greene King reported an 11.2% fall in adjusted pre-tax profit for the full year, to £243 million, in line with forecasts.  
    BP is to acquire Chargemaster, the UK’s largest charging network for electric cars. It operates more than 6,500 charging points across the UK.  
    Tullow Oil said that it continued to perform well in 2018, with first-half production averaging 87,400 barrels per day, in line with forecasts. 
    Wilson Bayly Holme - Ovcon Ltd has said that Lower activity levels persist within local (Africa) building markets, particularly in Gauteng. Performance from the Byrne Group in London was in line with expectations over the second six months.Construction and materials saw strong competition and aggressive pricing persisted during the second half of the year which combined with an increase in non-payment by contractors due to the challenging environment.
    BP upgraded to buy at Kepler Cheuvreux
    Infineon upgraded to buy at DZ Bank
    KAZ Minerals upgraded to outperform at BMO
    OMV upgraded to hold at Kepler Cheuvreux
    Suez downgraded to hold at Berenberg
    Summit Therapeutics cut to hold at Panmure Gordon & Co
    IGTV - promoted video
    Please note: This information has been prpared 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.

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