Today's edition features:
• Harvest Minerals (LON:HMI)
"You could almost hear a collective sigh of relief on Wall Street. Despite contrasting with releases from earlier in the week, Friday's closely-watched Non-Farm Payroll data for June significantly exceeded expectations and was augmented by a solid upward revision, while average earnings also rose modestly. Sweet music for equity traders, suggesting the first half's near ideal conditions of strong growth amid subdued inflation just might be continuing after all, despite having spent the past couple of weeks increasingly fretting about macro snippets suggesting slowing activity and tightening scenarios emanating from the central banks. As a result, the three major averages all put on convincing gains with good volume, allowing the S&P500 to eventually close the week unchanged having reacted negatively to other weaker data in earlier days. Techs lead Friday's gains, with the Philadelphia Semiconductor Index rising over 1.7%, although the Arca Oil Index only managed to claw its way back to unchanged by the close, having suffered from continued pressure on crude following Thursday's news of Russia's apparent unwillingness to participate in further OPEC production cuts, while Airlines and Housing also met profit taking earlier in the session. The coming fortnight will likely re-focus on individual corporate earnings, however, as Q2'2017 numbers are released kicking-off with the major Financials this Friday, followed by the tech giants, Facebook, Apple, Amazon, Netflix and Google, the following week. After a first quarter that recorded the best earnings growth for the S&P-500 in more than five years, some investors have already started to rotate portfolios back into banking stocks that might be expected to benefit from anticipated higher interest rates and bond yields in coming months, while lightening positions in premium digital issues which will now have to work hard to impress. Any policy signals coming from Janet Yellen's testimony to Congress this Thursday could accelerate this further. Perhaps anticipating just such an outcome, 10-year Treasury yields hit 2.389% on Friday, its highest since May following seven rises in the past eight sessions. Gold meanwhile hit its lowest level since mid- March. Asia-Pacific stocks started the new week positively this morning, buoyed by Friday's gains in the US and satisfied with China's June CPI outcome of 1.5%, which was unchanged on May as slower growth in consumer and industrial prices were offset by smaller drop in food prices. The Nikkei rose back above the 20,000 level after closing at a three-week low on Friday on the US$ rebound, while the S&P/ASX 200 also recovered after Friday's 1% decline. Australia's major banks, which are heavily weighted in the benchmark were up some 1%, compensating for the broader fall-off amongst Oil stocks. Gathering US momentum was not enough to drive most of the Continental European bourses out of the red on Friday, having reacted to the continuing slide in crude together with ongoing concerns on monetary policy earlier in their session. The STOXX 600 finally ended just fractionally down, with the CAC-40 off 0.14% and the FTSE MIB down 0.33%. Weaker Sterling supported the internationally based FTSE-100 as well as the more domestic FTSE-250 which, this week will probably focus on Wednesday's Labour Market data for the three months through May in their search for further signs of Q2'2017 weakness, following last week's disappointing industrial production data. UK macro releases include the BRC like-for-like Retail Sales figures for June and the BDO Monthly Business Trends. The EU provides its Sentix Investor Confidence data for June, while the US is scheduled to publish June Labour Market Conditions and Consumer Credit Change numbers for May. UK corporates expected to release earnings or trading statements today include Centamin (CEY.L), AEW UK REIT (AEWU.L) and Falanx Group (FLX.L). Europe can be expected to follow the lead set by the overnight markets this morning, with the FTSE-100 seen rising around 30 points in early trading."
- Barry Gibb, Research Analyst
Markets
Europe
The FTSE-100 finished Friday's session 0.19% higher at 7,350.92 whilst the FTSE AIM All-Share index was up 0.31% at 959.02. In continental Europe, the CAC-40 finished down 0.14% at 5,145.16 whilst the DAX finished 0.06% higher at 12,388.68.
Wall Street
In New York on Friday night, the Dow Jones rose 0.44% to 21,414.34, the S&P-500 firmed 0.64% to 2,425.18 and the Nasdaq gained 1.04% to stand at 6,153.08.
Asia
In Asian markets this morning, the Nikkei 225 had improved 0.66% to 20,059.94, while the Hang Seng firmed 1.05% to 25,608.16.
Oil
In early trade today, WTI crude was up 0.93% to $44.64/bbl and Brent was ahead 0.9% to $47.13/bbl.
Headlines
Minimum wage push for gig economy workers
A government review into the rapidly changing world of work is to demand a radical overhaul of employment law and new guarantees on the minimum wage. The review is set to call for a new category of worker called a "dependent contractor". Those workers - likely to cover riders for firms like Deliveroo and Uber - should receive benefits such as sick pay and holiday leave, it will say. And they will be covered by some of the minimum wage requirements. This will help clear up the present grey area between a fully employed and a self-employed person - presently called a "worker" in employment law. The review by Matthew Taylor, the head of the Royal Society of Arts and a former Tony Blair adviser, will outline a structure obliging firms to show that a person working for them can earn at least 1.2 times the present national living wage of £7.50 an hour for over-25s. The companies will do that by modelling the number of tasks - or "gigs" - an average person working at an average rate can achieve.
Source: BBC News
Company news
Harvest Minerals (LON:HMI, 9.75p) - Speculative Buy
Harvest has appointed an experienced Sales Manager to market KPfertil, its multi nutrient fertiliser product. Mr Lino Furia has over 20 years relevant experience including developing markets for new products in Brazil. He has worked for Vale Fertilisers, Yara Fertilisers, Mosaic Fertilisers and as Marketing Manager of phosphate miner, Rio Verde Minerals.
Our View: This looks like an important hire and one which reflects the potential of KPfertil. Selling the product will be greatly assisted by it getting certified as a remineralizer (expected by the end of 2017), however we are still expecting initial sales in 3Q. Mr Lino Furia will work with Harvest's technical team and potential customers to optimise the product and integrate it into their current fertiliser regimes. His contacts and experience marketing new fertiliser products in Brazil will be very valuable to Harvest. We have a Speculative Buy recommendation.
Beaufort Securities Limited acts as corporate broker to Harvest Minerals plc