UK Market Snapshot
UK markets finished mixed yesterday, as investors digested latest corporate earnings announcements. Diageo advanced 3.6%, after the company reported upbeat jump in its half yearly profit following favourable foreign exchange rates and improved performance in the US spirits market. Royal Bank of Scotland Group edged 2.4% up, after the bank stated that it would set aside further £3.1 billion to settle penalty in the US related to its improper sales of mortgage-backed securities. Card Factory added 2.2%, as it expects to report robust pre-tax profit for the full year, helped by good trading period over festive season. Bucking the trend, Unilever dropped 4.7%, after the company posted lower than expected sales for the fourth quarter and warned that difficult trading environment may continue in the first half of 2017. The FTSE 100 declined marginally, to close at 7,161.5, while the FTSE 250 rose 0.1%, to settle at 18,142.7.
US Market Snapshot
US markets closed mostly lower yesterday, amid a mixed batch of corporate results. Mattel plunged 17.7%, after the company posted downbeat results for the fourth quarter. QUALCOMM tumbled 5.0%, as the company offered a dismal financial outlook for the second quarter. Ford Motor dropped 3.3%, after the carmaker reported a $800.0 million loss in the fourth quarter. Johnson & Johnson shed 0.9%, after it agreed to acquire Actelion, up 19.6%, in a cash deal worth $30.0 billion. On the positive side, Charter Communications surged 7.4%, on news that Verizon Communications, down 1.3%, is exploring a possible combination with the company. eBay jumped 5.0%, after it posted upbeat earnings in the fourth-quarter holiday shopping period. The S&P 500 slipped 0.1%, to settle at 2,296.7. The DJIA rose 0.2%, to settle at 20,100.9, while the NASDAQ slid marginally, to close at 5,655.2.
Europe Market Snapshot
Other European markets ended mostly in positive territory yesterday, boosted by gains in healthcare sector stocks. Actelion rallied 19.4%, after Johnson & Johnson stated that it would acquire the drugmaker for $30.0 billion. Peers, Roche Holdings and Novartis added 0.4% and 0.9%, respectively. STMicroelectronics surged 7.6%, after the company posted better than expected fourth quarter earnings. Fiat Chrysler Automobiles climbed 2.2%, after the carmaker reported upbeat net profit for the fourth quarter and offered a robust outlook for 2017. Nordea Bank edged 1.4% up, after its profit for the fourth quarter surpassed analysts’ estimates and it raised its dividend for 2016. The FTSEurofirst 300 index gained 0.2%, to close at 1,451.1. Among other European markets, the German DAX Xetra 30 rose 0.4%, to close at 11,848.6, while the French CAC-40 shed 0.2%, to settle at 4,867.2.
Asia Market Snapshot
Markets in Asia are trading mixed this morning. In Japan, oil stocks, JX Holdings, Japan Petroleum Exploration and Inpex have advanced 2.3%, 4.4% and 5.2%, respectively, tracking gains in crude oil prices. Financial stocks, Mitsubishi UFJ Financial Group and Sumitomo Mitsui Trust Holdings have gained 1.5% and 2.2%, respectively. Toshiba has risen 1.8%, as its Board approved to split off its core chip business and seek outside investment in it. In Hong Kong, market has closed early today due to upcoming Lunar New Year holidays. Gaming stocks, Galaxy Entertainment Group, Melco International Development and Wynn Macau have risen 0.7%, 1.0% and 2.8%, respectively. In South Korea, markets are closed on account of a public holiday. The Nikkei 225 index is trading 0.3% higher at 19,459.8. The Hang Seng index closed 0.1% lower, to end at 23,360.8. Yesterday, the Kospi index rose 0.8%, to settle at 2,083.6.
Key Corporate Announcements Today
AGMs
Caledonian Trust, Nektan (DI), Treatt, Inspirit Energy
EGMs
Final Dividend Payment Date
Character Group, Inland Homes, Standard Life European Private Equity Trust
Interim Dividend Payment Date
Aberdeen New Dawn Investment Trust, Aberdeen Smaller Companies Income Trust, Amedeo Air Four Plus Limited, Artemis Alpha Trust, Auto Trader Group, Burberry Group, Caledonia Mining Corporation (DI), Cranswick, Dixons Carphone, Ensor Holdings, Experian, Fulcrum Utility Services LTD. (DI), Henderson High Income Trust, Invesco Perpetual Enhanced Income Limited, JPMorgan Income & Capital Inv Trust, Latham (James), Livermore Investments Group Ltd., Martin Currie Global Portfolio Trust, Marwyn Value Investors Limited, Micro Focus International, NewRiver REIT, Northern 2 VCT, Northern 3 VCT, RPC Group, Schroder European Real Estate Investment Trust, Shires Income, Speedy Hire, Supergroup, Troy Income & Growth Trust
Quarterly Payment Date
BlackRock Income Strategies Trust, Value and Income Trust
Trading Announcements
Mortgage Advice Bureau Holdings, Paragon Group of Companies, BT Group
Key Corporate Announcements for Monday
AGMs
Ixico
Final Dividend Payment Date
Marston's, Oakley Capital Investments Ltd. (DI)
Interim Ex-Dividend Date
Banco Santander S.A.
Interim Dividend Payment Date
Aberdeen Latin American Income Fund Ltd
Trading Announcements
Cranswick, Flybe
Commodity, Currency and Fixed Income Snapshots
Crude Oil
At 0430GMT today, Brent Crude Oil one month futures contract is trading marginally higher at $56.24 per barrel, ahead of Baker Hughes weekly oil rig count data, scheduled to release later in the day. Yesterday, the contract climbed 2.11% or $1.16, to settle at $56.24 per barrel, boosted by growing confidence on output cut by major oil producers as promised.
Gold
At 0430GMT today, Gold futures contract is trading 0.29% or $3.50 lower at $1186.30 per ounce. Yesterday, the contract declined 0.67% or $8.00, to settle at $1189.80 per ounce, extending its previous session losses, amid strength in the greenback.
Currency
At 0430GMT today, the EUR is trading 0.07% lower against the USD at $1.0673, ahead of Germany’s import price index for December, slated to release in a while. Yesterday, the EUR weakened 0.60% versus the USD, to close at $1.0680, reversing its prior session gains.
At 0430GMT today, the GBP is trading 0.17% lower against the USD at $1.2564. Investors will closely await the meeting of Donald Trump and Theresa May along with the US annualised GDP growth for the fourth quarter, scheduled to be released later today. Yesterday, the GBP declined 0.35% versus the USD, to close at $1.2586. Meanwhile, UK’s economy expanded at a faster than expected rate in the final quarter of 2016 amid robust consumer spending. Additionally, the US Markit services PMI advanced more than expected in January, bolstering optimism over the state of the nation’s economy.
Fixed Income
In the US, long term treasury prices rose and pushed yields lower, amid weakness in US equity markets. Yesterday, yield on 10-year notes fell 2 basis points to 2.51%, while yield on 2-year notes lost 2 basis points to 1.21%. Meanwhile, 30-year bond yield fell 2 basis points to 3.08%.
Key Economic News
UK index of services rose more than expected in November
On a MoM basis in the UK, the index of services rose 1.00% in November, compared to a revised advance of 1.10% in the August-October 2016 period. Market expectation was for the index of services to advance 0.90%.
UK index of services advanced as expected in November
In November, on a MoM basis, the index of services registered a rise of 0.30% in the UK, at par with market expectations. In the previous month, the index of services had registered a similar rise.
UK GDP rose more than expected in 4Q 2016
In 4Q 2016, on a quarterly basis, the preliminary gross domestic product (GDP) recorded a rise of 0.60% in the UK, compared to a similar rise in the prior quarter. Market anticipation was for GDP to rise 0.50%.
UK BBA mortgage approvals surprisingly climbed in December
In December, BBA mortgage approvals in the UK advanced unexpectedly to 43.23 K, compared to market expectations of a steady reading. BBA mortgage approvals had registered a revised level of 41.00 K in the previous month.
UK GDP rose more than expected in 4Q 2016
The preliminary GDP rose 2.20% in the UK on a YoY basis in 4Q 2016, more than market expectations for an advance of 2.10%. In the previous quarter, GDP had registered a similar rise.
UK CBI distributive trade survey's retail sales balance dropped in January
The CBI distributive trade survey's retail sales balance in the UK eased to 8.00% in January, compared to a level of 35.00% in the previous month. Market anticipation was for the CBI distributive trade survey's retail sales balance to ease to a level of 27.00%.
German consumer confidence index climbed in February
Compared to a level of 9.90 in the prior month the consumer confidence index in Germany rose to a level of 10.20 in February. Markets were expecting the consumer confidence index to climb to 10.00.
Italian retail sales advanced more than expected in November
In November, on a YoY basis, the non-seasonally adjusted retail sales rose 0.80% in Italy, higher than market expectations for an advance of 0.30%. Retail sales had recorded a drop of 0.20% in the previous month.
Italian retail sales unexpectedly eased in November
On a MoM basis, in Italy, the seasonally adjusted retail sales recorded an unexpected drop of 0.70% in November, compared to an advance of 1.20% in the prior month. Market anticipation was for retail sales to record a flat reading.
Spanish unemployment rate (survey) recorded a decline in 4Q 2016
Unemployment rate (survey) in Spain registered a drop to 18.63% in 4Q 2016, lower than market expectations of a drop to 18.70%. In the prior quarter, unemployment rate (survey) had recorded a reading of 18.90%.
Swiss trade surplus slid in December
Trade surplus in Switzerland fell to CHF 2.72 billion in December. Switzerland had registered a revised trade surplus of CHF 3.50 billion in the prior month.
Swiss exports recorded a rise in December
In Switzerland, exports registered a rise of 9.90% on a monthly basis, in December. In the prior month, exports had dropped by a revised 4.00%.
Swiss imports declined in December
Imports slid 0.80% on a monthly basis in Switzerland, in December. In the prior month, imports had recorded a revised drop of 4.50%.
US Markit services PMI rose in January
In January, the flash Markit services PMI in the US recorded a rise to 55.10, compared to a level of 53.90 in the prior month. Market anticipation was for Markit services PMI to advance to a level of 54.40.
US Kansas City Fed manufacturing activity index steadied in January
In January, the Kansas City Fed manufacturing activity index in the US remained flat at 9.00, compared to market expectations of a drop to 8.00.
US wholesale inventories rose more than expected in December
On a monthly basis, the seasonally adjusted flash wholesale inventories registered a rise of 1.00% in December, in the US, compared to a similar rise in the prior month. Market expectation was for the wholesale inventories to rise 0.10%.
US Chicago Fed national activity index registered a rise in December
Compared to a revised level of -0.33 in the previous month the Chicago Fed national activity index in the US rose to a level of 0.14 in December. Markets were expecting the Chicago Fed national activity index to rise to -0.05.
US continuing jobless claims surprisingly climbed in the last week
In the week ended 14 January 2017, the seasonally adjusted continuing jobless claims rose unexpectedly to a level of 2100.00 K in the US, higher than market expectations of a drop to 2040.00 K. In the previous week, continuing jobless claims had registered a revised level of 2059.00 K.
US Markit composite PMI climbed in January
The flash Markit composite PMI in the US rose to a level of 55.40 in January. Markit composite PMI had recorded a reading of 54.10 in the previous month.
US initial jobless claims recorded a rise in the last week
The seasonally adjusted initial jobless claims climbed to 259.00 K in the week ended 21 January 2017, in the US, compared to a level of 234.00 K in the prior week. Markets were anticipating initial jobless claims to advance to a level of 247.00 K.
US leading indicator rose as expected in December
Leading indicator climbed 0.50% on a MoM basis in December, in the US, compared to a revised advance of 0.10% in the previous month. Market expectation was for leading indicator to climb 0.50%.
US new home sales declined in December
In December, new home sales in the US eased 10.40%, on MoM basis, to a level of 536.00 K, lower than market expectations of 588.00 K. New home sales had registered a revised level of 598.00 K in the previous month.
Japanese Tokyo CPI excluding food and energy remained unchanged in January
In January, on a YoY basis, Tokyo consumer price index (CPI) excluding food and energy in Japan remained unchanged, more than market expectations for a drop of 0.10%. Tokyo CPI excluding food and energy had dropped 0.20% in the prior month.
Japanese National CPI ex-fresh food declined less than expected in December
In Japan, National CPI ex-fresh food eased 0.20% in December on a YoY basis, less than market expectations for a fall of 0.30%. National CPI ex-fresh food had registered a drop of 0.40% in the prior month.
Japanese National CPI ex-food, energy remained flat in December
In December, National CPI ex-food, energy remained steady in Japan on a YoY basis, more than market expectations for a fall of 0.10%. In the previous month, National CPI ex-food, energy had climbed 0.10%.
Japanese Tokyo CPI surprisingly rose in January
In January, Tokyo CPI unexpectedly climbed 0.10% on an annual basis in Japan, more than market expectations for a steady reading. Tokyo CPI had registered a flat reading in the prior month.
Japanese Tokyo CPI excluding fresh food dropped less than expected in January
Tokyo CPI excluding fresh food eased 0.30% on an annual basis in Japan, in January, less than market expectations for a fall of 0.40%. In the previous month, Tokyo CPI excluding fresh food had dropped 0.60%.
Japanese national CPI rose more than expected in December
In December, the national CPI advanced 0.30% in Japan on a YoY basis, more than market expectations for an advance of 0.20%. In the prior month, the national CPI had registered a rise of 0.50%.