UK Market Snapshot
UK markets finished in negative territory yesterday, weighed down by losses in industrial sector stocks and as geopolitical tensions rose between the US and North Korea. G4S plunged 7.5%, despite posting a rise in its earnings for the first half of the year and projecting revenue growth for the full year to be in line with its medium-term guidance. Other industrial stocks, Ashtead Group and DCC declined 2.2% each. Lenders, Barclays, Royal Bank of Scotland Group and Standard Chartered dropped 0.8%, 2.1% and 2.6%, respectively. On the flipside, precious metal miners, Randgold Resources and Fresnillo advanced 2.8% and 4.9%, respectively, amid a surge in gold prices. Worldpay Group edged 1.3% up, after US based, Vantiv, agreed to acquire the former for about £8.0 billion in cash and stock. The FTSE 100 declined 0.6%, to close at 7,498.1, while the FTSE 250 fell 0.4%, to settle at 19,875.0.
US Market Snapshot
US markets closed lower yesterday, as mounting tensions between the US and North Korea and a slew of disappointing corporate releases dented investor sentiment. Office Depot sank 25.9%, after the retailer reported a fall in its net profit for the second quarter, trailing analysts’ expectations. Walt Disney declined 3.9%, after the media giant posted weaker than expected revenue for the third quarter. It also announced that it would terminate its distribution agreement with Netflix, down 1.5%, and launch an ESPN streaming service in 2018 and a Disney direct-to-consumers offering in 2019. Other entertainment firms, Twenty-First Century Fox and Viacom fell 0.5% and 2.0%, respectively. Bucking the trend, defence stocks, General Dynamics, Lockheed Martin and Raytheon gained 1.1%, 1.7% and 2.6%, respectively. The S&P 500 marginally slipped to settle at 2,474.0. The DJIA shed 0.2%, to settle at 22,048.7, while the NASDAQ slid 0.3%, to close at 6,352.3.
Europe Market Snapshot
Other European markets ended in the red yesterday, dragged down by a slump in banking sector stocks. Lenders, Banco Santander, Deutsche Bank and Credit Suisse Group declined 2.1%, 2.7% and 3.0%, respectively. Brenntag tumbled 6.3%, after the company’s results for the second quarter missed market estimates due to slower performances across Europe, the Middle East and Asia. Engie slipped 1.1%, after reports indicated that the company is in talks to acquire a wind power project in Brazil from Renova Energia. On the brighter side, Novo Nordisk surged 7.9%, after the company reported higher than expected profit for the first half and raised its full year growth targets. The FTSEurofirst 300 index declined 0.7%, to close at 1,493.9. Among other European markets, the German DAX Xetra 30 slid 1.1%, to close at 12,154.0, while the French CAC-40 shed 1.4%, to settle at 5,145.7.
Asia Market Snapshot
Markets in Asia are trading lower this morning, tracking overnight losses on Wall Street. In Japan, financial firms, Mitsubishi UFJ Financial Group, Dai-ichi Life Holdings and T&D Holdings have dropped 1.2%, 1.8% and 2.7%, respectively. On the contrary, Shiseido has surged 15.0%, after the company boosted its operating profit guidance for the year through December on the back of robust sales in high-end cosmetics. In Hong Kong, brokers, CITIC Securities and Haitong Securities have declined 2.2% and 2.3%, respectively. On the other hand, Wanda Hotel Development has rallied 22.4%, after news emerged that the company would acquire assets worth over $1.0 billion from firms controlled by Wang Jianlin. In South Korea, carmakers, Kia Motors and Hyundai Motor have slid 0.4% and 0.7%, respectively. The Nikkei 225 index is trading marginally lower at 19,736.7. The Hang Seng index is trading 1.5% down at 27,341.2, while the Kospi index is trading 1.1% lower at 2,342.4.
Key Corporate Announcements Today
AGMs
Blue Planet Investment Trust, Creightons, Invesco Asia Trust, Investec, Terra Capital
Final Ex-Dividend Date
BT Group, Calculus VCT, Diageo, Greene King, Iomart Group, Maven Income And Growth VCT 6, New Century AIM VCT, Northern Bear, Northgate, PZ Cussons, RPC Group, Triad Group, Yu Group
Final Dividend Payment Date
Avation, Impellam Group
Interim Ex-Dividend Date
Amino Technologies, Anglo American, AstraZeneca, Avon Rubber, Barclays, CVC Credit Partners European Opportunities Ltd EURO, CVC Credit Partners European Opportunities Ltd GBP, Direct Line Insurance Group, Drum Income Plus Reit, Ediston Property Investment Company, European Assets Trust, F&C Commercial Property Trust Ltd., Ferrexpo, Fevertree Drinks, Foresight Solar Fund LIMIted, Fresnillo, GCP Infrastructure Investments Ltd, GKN, Greencoat UK Wind, Hiscox Limited (DI), IMI, Impact Healthcare Reit, Informa, Keller Group, Lancashire Holdings Limited, Law Debenture Corp., Lloyds Banking Group, LSL Property Services, McColl's Retail Group, Rentokil Initial, Rio Tinto, RM, Schroder Real Estate Investment Trust Ltd, Spirent Communications, St. Modwen Properties, UK Commercial Property Trust, Vesuvius, Virgin Money Holdings (UK)
Interim Dividend Payment Date
Tritax Big Box Reit
Special Ex-Dividend Payment Date
Income & Growth VCT, Northern Bear
Quarterly Ex-Dividend Date
BP, GlaxoSmithKline, Picton Property Income Ltd, Royal Dutch Shell 'A', Royal Dutch Shell 'B'
Trading Announcements
DFS Furniture
Key Corporate Announcements for Tomorrow
AGMs
Heath (Samuel) & Sons, iEnergizer Ltd., Tower Resources
Final Dividend Payment Date
Amati VCT, Babcock International Group, Cropper (James), Dairy Crest Group, Establishment Inv Trust, F&C Global Smaller Companies, Martin Currie Asia Unconstrained Trust, Speedy Hire, Walker Greenbank
Interim Dividend Payment Date
Aberdeen Frontier Markets Investment Company, Alcentra Euorpean Floating Rate Income Fund Ltd Red Ord Shs, Schroder Oriental Income Fund Ltd., Unicorn AIM VCT
Special Dividend Payment Date
Establishment Inv Trust, Martin Currie Asia Unconstrained Trust
Quarterly Payment Date
Merchants Trust
Trading Announcements
Volution Group (WI)
Commodity, Currency & Bitcoin
Commodity
At 0330GMT today, Brent Crude Oil one-month futures contract is trading marginally or $0.02 lower at $52.68 per barrel. Yesterday, the contract climbed 1.07% or $0.56, to settle at $52.70 per barrel, after the Energy Information Administration reported that US crude inventories declined more than anticipated by 6.5 million barrels for the week ended 04 August 2017.
At 0330GMT today, Gold futures contract is trading 0.71% or $9.00 higher at $1282.00 per ounce. Yesterday, the contract advanced 1.32% or $16.60, to settle at $1273.00 per ounce, recording its highest one-day rise since mid-May, amid persisting geopolitical tensions between the US and North Korea after the two nations engaged into threatening verbal exchanges.
Currency
At 0330GMT today, the EUR is trading 0.14% lower against the USD at $1.1742. Yesterday, the EUR strengthened 0.06% versus the USD, to close at $1.1759, reversing its previous session losses.
At 0330GMT today, the GBP is trading 0.06% lower against the USD at $1.2996, ahead of UK’s manufacturing and industrial production data as well as total trade balance figures, all for June, slated to release in a few hours. Investors will also closely await the US weekly initial jobless claims data along with monthly budget statement for July, scheduled to be released later today. Yesterday, the GBP strengthened 0.09% versus the USD, to close at $1.3004. Meanwhile, UK’s RICS housing price balance grew at its slowest pace in four years in July. In other news, the US unit labour costs advanced less than expected in the second quarter and non-farm business productivity surpassed market estimates in the second quarter.
Bitcoin
At 0330GMT today, BTC is trading 0.60% lower against the USD at $3330.00. Yesterday, BTC declined 2.13% against the USD to close at $3350.06, taking a breather from its recent rally, following the official lock-in of Segregated Witness (SegWit). Meanwhile, a leading investment research firm commented that equities are likely to rise whenever Bitcoin witnesses explosive growth. In major news, Sony announced that it had developed a new educational platform in partnership with IBM using blockchain technology to secure and share student data.
Key Economic News
UK house price balance surprisingly fell in July
Compared to a level of 7.00% in the prior month house price balance dropped unexpectedly to a level of 1.00% in the UK, in July. Markets were expecting house price balance to climb to a level of 9.00%.
French business sentiment index unexpectedly rose in July
Compared to a reading of 103.00 in the prior month the business sentiment index registered an unexpected rise to a level of 105.00 in July, in France. Markets were anticipating the business sentiment index to record a steady reading.
Italian industrial production advanced more than expected in June
The seasonally adjusted industrial production rose 1.10% on a MoM basis in Italy in June, higher than market expectations for an advance of 0.20%. In the previous month, industrial production had recorded a rise of 0.70%.
Italian industrial production rose more than expected in June
On a YoY basis in Italy, the working day adjusted industrial production climbed 5.30% in June, higher than market expectations for a rise of 3.50%. In the previous month, industrial production had registered a revised rise of 2.70%.
Italian industrial production rose more than expected in June
The non-seasonally adjusted industrial production registered a rise of 5.40% on a YoY basis in Italy, in June, compared to a revised advance of 2.70% in the prior month. Market anticipation was for industrial production to rise 3.40%.
US wholesale inventories advanced more than expected in June
On a monthly basis, the seasonally adjusted final wholesale inventories advanced 0.70% in June, in the US, higher than market expectations for an advance of 0.60%. In the previous month, the wholesale inventories had advanced 0.40%. The preliminary figures had indicated a rise of 0.60%.
US unit labour costs in non-farm businesses rose less than expected in 2Q 2017
On a QoQ basis, in the US, the preliminary unit labour costs in non-farm businesses recorded a rise of 0.60% in 2Q 2017, lower than market expectations for a rise of 1.10%. In the prior quarter, the unit labour costs in non-farm businesses had registered a rise of 2.20%.
US non-farm business productivity rose more than expected in 2Q 2017
In 2Q 2017, the flash non-farm business productivity climbed 0.90% in the US on a QoQ basis, higher than market expectations for an advance of 0.70%. In the previous quarter, the non-farm business productivity had registered an unchanged reading.
US mortgage applications rose in the last week
On a weekly basis, mortgage applications rose 3.00% in the US, in the week ended 04 August 2017. Mortgage applications had recorded a drop of 2.80% in the previous week.
Canadian building permits surprisingly climbed in June
Building permits in Canada unexpectedly rose 2.50% in June on a MoM basis, compared to a revised rise of 10.70% in the previous month. Market expectation was for building permits to drop 1.90%.
Canadian housing starts surprisingly rose in July
In July, the seasonally adjusted housing starts in Canada climbed unexpectedly to a level of 222.30 K, higher than market expectations of a drop to a level of 205.00 K. In the previous month, housing starts had registered a reading of 212.70 K.
Japanese average office vacancies in Tokyo rose in July
In July, on a MoM basis, average office vacancies in Tokyo in Japan registered a rise of 3.22%. In the prior month, average office vacancies in Tokyo had risen 3.26%.
Japanese machine tool orders advanced in July
In July, on a YoY basis, the preliminary machine tool orders in Japan registered a rise of 26.30%. In the prior month, machine tool orders had advanced 31.10%.
Foreign investors remained net sellers of Japanese stocks in the previous week
Foreign investors were net sellers of ¥37.70 billion worth of Japanese stocks in the week ended 04 August 2017, from being net sellers of ¥123.80 billion worth of Japanese stocks in the previous week.
Japanese housing loans rose in 2Q 2017
Housing loans in Japan rose 3.30% on an annual basis, in 2Q 2017. In the prior quarter, housing loans had registered a similar rise.
Japanese investors remained net buyers of foreign stocks in the previous week
Japanese investors remained net buyers of ¥160.80 billion worth of foreign stocks in the week ended 04 August 2017, from being net buyers of ¥137.40 billion worth of foreign stocks in the previous week.
Foreign investors became net buyers of Japanese bonds in the previous week
Foreign investors remained net buyers of ¥598.30 billion worth of Japanese bonds in the week ended 04 August 2017, as compared to being net buyers of ¥293.90 billion worth of Japanese bonds in the prior week.
Japanese machinery orders declined more than expected in June
In June, on a YoY basis, machinery orders in Japan dropped 5.20%, compared to an advance of 0.60% in the previous month. Market anticipation was for machinery orders to drop 1.10%.
Japanese investors became net buyers of foreign bonds in the previous week
Japanese investors remained net buyers of ¥1624.20 billion worth of foreign bonds in the week ended 04 August 2017, as compared to being net buyers of a revised ¥1069.50 billion worth of foreign bonds in the prior week.
Japanese machinery orders unexpectedly dropped in June
In June, machinery orders unexpectedly dropped 1.90% in Japan on a monthly basis, compared to a drop of 3.60% in the prior month. Market anticipation was for machinery orders to climb 3.60%.