SVS Early Robin 26/02/2019


  • SVS expects the FTSE100 to open 45 points lower as US-China trade-deal enthusiasm cools in Asia and nerves rise regarding risks from China’s soaring international debts.
  • Labour are now formally supporting a second Brexit referendum whilst Teresa May continues to say that a deal ‘is within our grasp’.
  • U.S. stocks came off Monday’s early highs with trade headlines continuing to dominate trading.
  • Cooper-Letwin Amendment – Sterling remains in the firing line.
  • Today’s UK Financial updates include finals from: Augean, Croda International, Derwent London, Devro, Drax Group, Fresnillo, Hotel Chocolat, James Fisher and Sons, Jardine Lloyd Thompson, Meggitt, Morgan Advanced Materials, Persimmon, Springfield Properties, Standard Chartered, Travis Perkins and Verona Pharma.
 
Global Market Movements
Global Market Indices
FTSE 100
7,183.74
5.14
0.07%
FTSE 250
19,246.98
-22.61
-0.12%
Xetra DAX
11,505.39
47.69
0.42%
CAC40
5,231.85
16.00
0.31%
EuroSTOXX50
372.18
0.95
0.26%
Dow Jones
26,091.95
60.14
0.23%
Nasdaq
7,554.46
26.92
0.36%
S&P500
2,796.11
3.44
0.12%
Nikkei 225*
21,449.39
-78.84
-0.37%
Hang Seng*
28,753.94
-204.69
-0.69%
Shanghai*
2,972.84
10.30
0.37%
Sensex50*
35,998.40
-221.93
-0.60%
Foreign Exchange (Majors)
USD/JPY
110.82
-0.23
-0.21%
EUR/USD
1.1359
0.0000
0.00%
GBP/USD
1.3138
0.0041
0.31%
Crude Oil
Nymex
55.21
-0.27
-0.49%
Brent
18.36
0.01
0.05%
Gold (USD/ounce)
Spot
149.33
0.00
0.00%
Futures
1,330.10
0.60
0.05%
Bond Yields (10 year)
U.S
2.651
-0.0143
-
German
0.113
0.00
-
*figures correct as of (06:00 – GMT)
Today's key Economic/Political events
Time (GMT)
Event
Expected
Previous
9:30
UK BBA Mortgage Approvals (Jan)
-
38.779K
13:30
US Housing Starts (MoM, Dec)
1.253M
1.256M
13:55
Redbook Index (YoY, Feb 23)
-
5.4%
14:00
S&P/Case-Shiller Home Price Indices (YoY, Dec)
4.5%
4.7%
Today's Market Call
  • SVS expects the FTSE100 to open 45 points lower as US-China trade-deal enthusiasm cools in Asia and nerves rise regarding risks from China’s soaring international debts. This follows the index just about managing to close Monday's session in positive territory (+0.1%), while the FTSE 250 was dragged lower (-0.1%) on gold miner Centamin’s decline amid what was then generally positive sentiment regarding the delayed US tariff hike on Chinese goods but caution of Theresa May delaying the next Brexit vote. Contrasting stonger gains across other Europe’s indexes, the pound rose on the news U.K. Prime Minister Theresa May has delayed a parliamentary vote on her Brexit deal. Yesterday’s Principal winners included heavyweight miners, while house builder came under fire from UK housing minister James Brokenshire for its practices in a government funded housing scheme known as ‘Help to Buy’.
  • An agreement for the UK to leave the EU on schedule remains “within our grasp” according to Prime Minister Theresa May yesterday, even while news reports suggest she pondered a contingency plan asking the EU for a two-month extension if she cannot get parliament to back a deal by March 12. The European Council President, Donald Tusk, meanwhile noted that extending the Brexit negotiating process was the "rational solution" to the impasse. Meanwhile, the Labour Party said it would support holding a second Brexit referendum, a policy shift that breathes some life into the prospect of Britons voting again on whether the U.K. should still consider leaving the European Union.
  • U.S. stocks came off Monday’s early highs with trade headlines continuing to dominate trading. The Dow Jones Industrial Average rose just 0.2% by the close, with the S&P 500 up only 0.12% with the Nasdaq Composite gained 0.4%. Worries that the U.S. and China's trade fight could take its toll on global growth have kept a lid on many investors' optimism throughout the past year; Mr. Trump's move to delay tariff increases that were set to take effect at the end of this week helped reassure investors that the two countries are inching closer to a possible agreement. General Electric up 17% premarket: General Electric agreed to sell its biotechnology business to Danaher Corp. for $21 billion in cash, moving to pay down debt by parting with one of its fastest-growing. In Europe, the Stoxx Europe 600 index closed up 0.3% yesterday having reached its highest intraday level in more than four months.
  • Asia shares were mostly lower in this morning’s late trading. This is despite Trump tweeting that continued progress meant that the US would plan a summit with President Xi Jinping of China to "conclude an agreement" that would settle a yearlong trade fight between the two nations. Japan’s Nikkei 225 index lost 0.4%, the Hang Seng fell 0.6% and the Kospi slipped 0.3%.and Singapore’s STI index -0.4%. Standing out was the Shanghai Composite which added 0.5% after a report in the South China Morning Post stating that a deputy chairman of the Banking Regulatory Commission, Wang Zhaoxing, had said risks from soaring debt had been contained.
  • Cooper-Letwin Amendment – Sterling in the firing line: International investors are choosing to hedge their exposure to the Pound until there is greater political clarity in the run-up to Brexit. Should the so called Cooper-Letwin Amendment (name after the two MPs who proposed it) be supported in tomorrow’s parliamentary vote, Sterling is seen strengthening sharply; conversely, should MPs be seen refusing to take ‘No-Deal off the table’ for a second time and now so close to the 29th March, a lurch in the opposite direction should be anticipated.
  • Today’s UK Financial updates include finals from: Augean, Croda International, Derwent London, Devro, Drax Group, Fresnillo, Hotel Chocolat, James Fisher and Sons, Jardine Lloyd Thompson, Meggitt, Morgan Advanced Materials, Persimmon, Springfield Properties, Standard Chartered, Travis Perkins and Verona Pharma, plus interims from Town Centre Securities and Tristel and trading statements from ASA International and Babcock International. The stream of US quarterly earnings announcements is drawing to a close now, but still includes: Achaogen, AutoZone, Chesapeake Utilities, FTI Consulting, Getty Realty, The Home Depot, Lending tree, Liberty Mutual, Palo Alto Networks, Papa John’s Intl, Weight Watchers Intl, Wolrdpay and Wyndham Destinations.
 

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