Equities have stumbled in early trading, with the FTSE 100 down 40 points and European markets pushing lower as well.
Faced with a dearth of news, equities have drifted lower this morning, with losses on the FTSE 100 coming off the back of the steady move higher over the past week. What is really needed to drive this market higher is a good trade talk headline, and for the moment is does look like things are moving in the direction of a deal. That is more than can be said for Brexit, which remains mired in debate. The EU had always proclaimed that it was negotiating with the PM, but now it has the entirety of Parliament to deal with as well, and division prevails here. The House of Commons might have declared its intention to avoid a no-deal Brexit, but in the absence of something else one seems inevitable. UK bank stocks are mixed as investors keep a nervous eye on the situation in Germany, where Unicredit has declared itself as a suitor for Commerzbank, but how the German government will allow a foreign takeover of its second-largest bank remains to be seen, especially if that takeover is followed by heavy cost-cutting and job losses.
Saga’s high dividend yield heading into this morning’s results should have been taken as a warning that a cut to the payout was a possibility, and it has come to pass. The pre-tax loss is also bad news, but with trading already looking tough the dividend was perhaps the last attraction the shares had left. Now that has also been sullied, and even the travel business is expected to see tougher times ahead.
Ahead of the open, we expect the Dow to start at 26,197, down 21 points on Wednesday’s close.
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.
Recommended Content
Editors’ Picks
EUR/USD treads water just above 1.0400 post-US data
Another sign of the good health of the US economy came in response to firm flash US Manufacturing and Services PMIs, which in turn reinforced further the already strong performance of the US Dollar, relegating EUR/USD to the 1.0400 neighbourhood on Friday.
GBP/USD remains depressed near 1.2520 on stronger Dollar
Poor results from the UK docket kept the British pound on the back foot on Thursday, hovering around the low-1.2500s in a context of generalized weakness in the risk-linked galaxy vs. another outstanding day in the Greenback.
Gold keeps the bid bias unchanged near $2,700
Persistent safe haven demand continues to prop up the march north in Gold prices so far on Friday, hitting new two-week tops past the key $2,700 mark per troy ounce despite extra strength in the Greenback and mixed US yields.
Geopolitics back on the radar
Rising tensions between Russia and Ukraine caused renewed unease in the markets this week. Putin signed an amendment to Russian nuclear doctrine, which allows Russia to use nuclear weapons for retaliating against strikes carried out with conventional weapons.
Eurozone PMI sounds the alarm about growth once more
The composite PMI dropped from 50 to 48.1, once more stressing growth concerns for the eurozone. Hard data has actually come in better than expected recently – so ahead of the December meeting, the ECB has to figure out whether this is the PMI crying wolf or whether it should take this signal seriously. We think it’s the latter.
Best Forex Brokers with Low Spreads
VERIFIED Low spreads are crucial for reducing trading costs. Explore top Forex brokers offering competitive spreads and high leverage. Compare options for EUR/USD, GBP/USD, USD/JPY, and Gold.