logo-loader

Market Briefing - UK markets finished in positive territory yesterday boosted by gains in shares of multinational firms

Published: 08:26 19 Oct 2017 BST

no_picture_pai

UK Market Snapshot

UK markets finished in positive territory yesterday, boosted by gains in shares of multinational firms as the Pound slipped against the US Dollar. G4S, Ashtead Group and Burberry Group advanced 0.9%, 1.4% and 1.5%, respectively. Softcat jumped 6.0%, after the company raised its dividend following a rise in its revenue and profit for the full year. On the flipside, Rio Tinto dropped 3.0%, after the US Securities and Exchange Commission charged the miner and two former top executives with fraud and it was fined £27.4 million by the UK financial regulator for overstating the value of its African coal assets. Reckitt Benckiser Group declined 2.5%, after the company trimmed its comparable revenue for the full year due to fallout from a cyber attack, a failed product launch and a safety scandal in South Korea. The FTSE 100 advanced 0.4%, to close at 7,542.9, while the FTSE 250 rose 0.6%, to settle at 20,259.8.

US Market Snapshot

US markets ended in the green yesterday, with the DJIA index closing above 23,000 points for the first time since its inception, led by a rally in financial sector stocks and robust earnings reports. International Business Machines surged 8.9%, after the company’s earnings for the third quarter topped market estimates. Northern Trust climbed 3.8%, after the company posted upbeat earnings for the third quarter. Lenders, Citigroup, Morgan Stanley and Goldman Sachs Group advanced 1.3%, 2.1% and 2.5%, respectively. Abbot Laboratories gained 1.3%, after the company reported a rise in its profit for the third quarter amid strong sales in its medical devices business. Bucking the trend, Electronic Arts declined 2.4%, after the company announced that it would postpone the release of a Star Wars action-adventure game. The S&P 500 gained 0.1%, to settle at 2,561.3. The DJIA rose 0.7%, to settle at 23,157.6, while the NASDAQ marginally advanced to close at 6,624.2.

Europe Market Snapshot

Other European markets finished on a stronger footing yesterday. German lenders, Commerzbank and Deutsche Bank advanced 0.5% and 1.1%, respectively. HOCHTIEF rose 0.8%, after the company launched a €17.10 billion voluntary public takeover offer for Spanish toll road operator, Abertis Infraestructuras, up 7.0% and thwarted an effort by Italy’s Atlantia, down 1.2%, to acquire the firm. On the losing side, Zalando declined 3.8%, after the company warned that it might report a pretax loss in the third quarter. Akzo Nobel slipped 1.8%, after the company reported a significant fall in its earnings for the third quarter due to headwinds at its marine coatings business and margin pressures from rising raw material costs. The FTSEurofirst 300 index gained 0.3%, to close at 1,539.8. Among other European markets, the German DAX Xetra 30 rose 0.4%, to close at 13,043.0, while the French CAC-40 advanced 0.4%, to settle at 5,383.8.

Asia Market Snapshot

Markets in Asia are trading mostly lower this morning. Meanwhile, data showed that Chinese economy grew in line with expectations in the third quarter. In Japan, the Nikkei index has reached its fresh 21-year high level. Japan Exchange Group has advanced 1.2%, after the company and CME Group agreed to launch yen-denominated Topix futures contracts to begin trading on CME Globex in April 2018. In Hong Kong, CNOOC, Sinopec Oilfield Service and China Petroleum & Chemical have slipped 0.2%, 0.7% and 0.9%, respectively. In South Korea, technology giants, SK Hynix and Samsung Electronics have declined 1.2% and 2.1%, respectively. The Nikkei 225 index is trading 0.7% higher at 21,503.9. The Hang Seng index is trading 0.1% down at 28,677.4, while the Kospi index is trading 0.3% lower at 2,475.0.

Key Corporate Announcements Today

AGMs

BHP Billiton, PCI-PAL, Rank Group

Final Ex-Dividend Date

Fidelity Asian Values, Henderson EuroTrust, Smiths Group, Wilmington

Final Dividend Payment Date

Joules Group, Oxford Instruments

Interim Ex-Dividend Date

Aberdeen Asian Income Fund Ltd., Action Hotels, Alcentra Euorpean Floating Rate Income Fund Ltd Red Ord Shs, Amati Vct 2, Amedeo Air Four Plus Limited, BAE Systems, Burford Capital, Capita, City Merchants High Yield Trust, Doric Nimrod Air One Ltd, Doric Nimrod Air Three Limited Red Ord Pref Shs Npv, Doric Nimrod Air Two Ltd Pref Shs Npv, Ediston Property Investment Company, Harvey Nash Group, Howden Joinery Group, ICG Enterprise Trust, Intu Properties, M. P. Evans Group, Marshalls, Mears Group, Menzies(John), NewRiver REIT, S&U, Senior, Smart Metering Systems, Stilo International, Ted Baker, Tritax Big Box Reit, Twentyfour Income Fund Limited Ord Red, TwentyFour Select Monthly Income Fund Limited, UK Mortgages Limited, Walker Greenbank, Witan Pacific Inv Trust, Zegona Communications

Interim Dividend Payment Date

Dairy Farm International Holdings Ltd (Bermuda), Dairy Farm International Holdings Ltd. (Jersey), Dairy Farm International Holdings Ltd. (Singapore), Duke Royalty Limited, Gamma Communications, GVC Holdings, Hongkong Land Holding Ltd. (Sing.Reg), Jardine Matheson Holdings Ltd (Singapore Reg), Jardine Strategic Holdingd Ltd. (Bermuda), Jardine Strategic Holdingd Ltd. (Jersey REG), Jardine Strategic Holdings Ltd. (Singapore), Mandarin Oriental International (Bermuda), Mandarin Oriental International (Jersey), Mandarin Oriental International (Singapore), SQN Asset Finance Income Fund Limited, SQN Asset Finance Income Fund Limited 'C Shares', TT Electronics

Special Ex-Dividend Payment Date

ProVen Growth & Income VCT, ProVen VCT

Quarterly Payment Date

Fair Oaks Income Limited 2014 Shs NPV, Fair Oaks Income Limited 2017 Shs NPV

Quarterly Ex-Dividend Date

City of London Inv Trust

Trading Announcements

Travis Perkins

Key Corporate Announcements for Tomorrow

AGMs

Ashmore group, Hadrian's Wall Secured Investments, Renishaw, Vast Resources

Final Dividend Payment Date

Green Reit, Hargreaves Lansdown, Hargreaves Services, HML Holdings, Kainos Group, Norish Units

Interim Dividend Payment Date

Applegreen, Barr (A.G.), Braime (T.F.& J.H.) Holdings, Braime (T.F.& J.H.) Holdings (Non-Voting), Christie Group, Convatec Group, Costain Group, Derwent London, Eddie Stobart Logistics, Epwin Group, Henry Boot, Hunters Property, Inmarsat, JPMorgan Income & Capital Inv Trust, Petrofac Ltd., Phoenix Spree Deutschland Limited Shs NPV, Shire Plc, Stadium Group, Vitec Group

Trading Announcements

InterContinental Hotels Group, Record, Renishaw

 

Commodity, Currency & Bitcoin

Commodity

At 0330GMT today, Brent Crude Oil one-month futures contract is trading 0.19% or $0.11 lower at $58.04 per barrel. Yesterday, the contract climbed 0.47% or $0.27, to settle at $58.15 per barrel, after the Energy Information Administration reported that US crude oil inventories declined by 5.7 million barrels for the week ended 13 October 2017.

At 0330GMT today, Gold futures contract is trading marginally lower at $1279.80 per ounce. Yesterday, the contract fell 0.24% or $3.10, to settle at $1279.90 per ounce, extending its previous two session losses, amid gains in global equities.

Currency

At 0330GMT today, the EUR is trading 0.10% higher against the USD at $1.1799, ahead of the European Council meeting, scheduled for today. Investors will also monitor the US Philadelphia Fed manufacturing survey for October and weekly jobless claims data, set to release later today. Yesterday, the EUR strengthened 0.18% versus the USD, to close at $1.1787. Meanwhile, the Euro-zone’s construction output dropped in August amid softer activity in both building and civil engineering.

At 0330GMT today, the GBP is trading marginally higher against the USD at $1.3210, ahead of UK’s retail sales data for September, scheduled to be released in a few hours. Yesterday, the GBP advanced 0.11% versus the USD, to close at $1.3205, after the nation’s unemployment rate remained steady at a 42-year low level for the three months to August. Meanwhile, UK’s average earnings unexpectedly advanced in the June-August period.

Bitcoin

At 0330GMT today, BTC is trading 0.72% higher against the USD at $5613.94. Yesterday, BTC declined 0.39% against the USD to close at $5574.02, after a report indicated that the US Commodity Futures Trading Commission claimed jurisdiction over Bitcoin derivates, raising fears about tighter regulations in the cryptocurrency market. Meanwhile, the Bank of Canada (BoC) Senior Deputy Governor, Carolyn Wilkins, believes that virtual currencies would not replace cash in the future. Separately, Bitfinex revealed that it would terminate all its services for US individual customers by 09 November 2017.

 

Key Economic News

Number of unemployment benefits claimants in the UK rose in September

In the UK, number of unemployment benefits claimants advanced by 1.70 K in September, compared to a revised loss of 0.20 K in the previous month.

UK average earnings including bonus advanced more than expected in the June-August 2017 period

In the June-August 2017 period, the average earnings including bonus recorded a rise of 2.20% on an annual basis in the UK, compared to a revised similar rise in the May-July 2017 period. Markets were anticipating the average earnings including bonus to climb 2.10%.

UK claimant count rate remained flat in September

The claimant count rate remained unchanged at a level of 2.30% in the UK, in September.

Employment in the UK increased in the June-August 2017 period

Employment recorded an increase of 94.00 K in the UK, in the June-August 2017 period, lower than market expectations of an advance of 148.00 K. Employment had registered an increase of 181.00 K in the May-July 2017 period.

UK ILO unemployment rate remained steady in the June-August 2017 period

In the June-August 2017 period, the ILO unemployment rate remained steady at a level of 4.30% in the UK, in line with market expectations.

UK average earnings excluding bonus rose more than expected in the June-August 2017 period

On a YoY basis, the average earnings excluding bonus in the UK advanced 2.10% in the June-August 2017 period, more than market expectations for a rise of 2.00%. In the May-July 2017 period, the average earnings excluding bonus had registered a revised rise of 2.20%.

Euro-zone construction output declined in August

On a monthly basis, the seasonally adjusted construction output dropped 0.20% in the Euro-zone, in August. Construction output had recorded a revised unchanged reading in the previous month.

Fed’s Beige Book: Economic activity expanded despite hurricanes, few signs of an uptick in inflation

The pace of growth in the US economy was “split between moderate and modest” across all twelve districts in September through early October, despite the impact of hurricanes on some regions. However, majority of the US districts reported “widespread” labour shortages along with only modest to moderate wage pressures and few signs of an uptick in inflation.

US building permits dropped in September

In the US, building permits recorded a drop of 4.50%, on monthly basis, to an annual rate of 1215.00 K in September, compared to market expectations of 1245.00 K. In the prior month, building permits had recorded a revised level of 1272.00 K.

US housing starts slid in September

Housing starts registered a drop of 4.70%, on MoM basis, to an annual rate of 1127.00 K in the US, in September, lower than market expectations of 1175.00 K. Housing starts had recorded a revised reading of 1183.00 K in the prior month.

US mortgage applications climbed in the last week

Mortgage applications in the US registered a rise of 3.60% in the week ended 13 October 2017 on a weekly basis. Mortgage applications had fallen 2.10% in the previous week.

Canadian manufacturing shipments unexpectedly advanced in August

In August, manufacturing shipments unexpectedly climbed 1.60% in Canada on a MoM basis, more than market expectations for a drop of 0.30%. Manufacturing shipments had dropped 2.60% in the previous month.

Japanese merchandise (total) trade surplus widened in September

Merchandise (total) trade surplus in Japan rose to ¥670.20 billion in September, compared to market expectations of a merchandise (total) trade surplus of ¥556.80 billion. Japan had registered a merchandise (total) trade surplus of ¥113.60 billion in the previous month.

Foreign investors became net buyers of Japanese stocks in the previous week

Foreign investors were net buyers of ¥840.70 billion worth of Japanese stocks in the week ended 13 October 2017, from being net buyers of ¥1235.30 billion worth of Japanese stocks in the prior week.

Japanese adjusted merchandise trade surplus slid in September

Adjusted merchandise trade surplus in Japan narrowed to ¥240.30 billion in September, compared to a revised adjusted merchandise trade surplus of ¥308.30 billion in the previous month. Market anticipation was for the nation to record an adjusted merchandise trade surplus of ¥309.20 billion.

Japanese investors became net buyers of foreign bonds in the previous week

Japanese investors were net buyers of ¥269.70 billion worth of foreign bonds in the week ended 13 October 2017, as compared to being net buyers of a revised ¥93.70 billion worth of foreign bonds in the prior week.

Japanese exports advanced less than expected in September

Exports in Japan climbed 14.10% in September on a YoY basis, less than market expectations for a rise of 15.00%. In the prior month, exports had climbed 18.10%.

Japanese investors became net buyers of foreign stocks in the previous week

Japanese investors were net buyers of ¥153.70 billion worth of foreign stocks in the week ended 13 October 2017, as compared to being net buyers of a revised ¥371.70 billion worth of foreign stocks in the previous week.

Japanese imports rose less than expected in September

In Japan, imports climbed 12.00% in September on an annual basis, less than market expectations for a rise of 14.70%. In the previous month, imports had registered a rise of 15.20%.

Foreign investors became net buyers of Japanese bonds in the previous week

Foreign investors were net buyers of ¥207.60 billion worth of Japanese bonds in the week ended 13 October 2017, from being net buyers of a revised ¥99.50 billion worth of Japanese bonds in the previous week.

Chinese industrial production (YTD) rose as expected in September

In September, on a YoY basis, industrial production (YTD) in China climbed 6.70%, at par with market expectations. Industrial production (YTD) had registered a similar rise in the previous month.

Chinese retail sales (YTD) rose more than expected in September

In September, retail sales (YTD) climbed 10.40% in China on an annual basis, more than market expectations for an advance of 10.30%. In the previous month, retail sales (YTD) had registered a similar rise.

Chinese industrial production rose more than expected in September

In September, on a YoY basis, industrial production in China advanced 6.60%, more than market expectations for a rise of 6.50%. Industrial production had climbed 6.00% in the previous month.

Chinese GDP advanced as expected in 3Q 2017

In 3Q 2017, on a YoY basis, gross domestic product (GDP) in China rose 6.80%, compared to an advance of 6.90% in the previous quarter. Markets were anticipating GDP to advance 6.80%.

Chinese fixed assets investment excl. rural YTD rose less than expected in September

On an annual basis, fixed assets investment excl. rural YTD in China registered a rise of 7.50% in September, less than market expectations for a rise of 7.70%. Fixed assets investment excl. rural YTD had climbed 7.80% in the prior month.

Chinese retail sales rose more than expected in September

On an annual basis, in September, retail sales advanced 10.30% in China, compared to a rise of 10.10% in the previous month. Markets were anticipating retail sales to rise 10.20%.

Chinese GDP advanced less than expected in 3Q 2017

GDP recorded a rise of 1.70% in China on a quarterly basis in 3Q 2017, less than market expectations for an advance of 1.80%. GDP had registered a similar rise in the prior quarter.

Chesnara reports strong 2023 results with improved cash generation and...

Chesnara PLC (LSE:CSN) chief executive Steve Murray discusses the company's full-year results for 2023 with Proactive's Stephen Gunnion, describing them as strong and particularly highlighting £53 million in commercial cash generation and a dividend coverage of around 150%. The company has...

1 hour, 45 minutes ago