This report is not a personal recommendation and does not take into account your personal circumstances or appetite for risk.
| UK 100 Leaders | Close (p) | Chg (p) | % Chg | % YTD |
| Inmarsat PLC | 1100 | 54.0 | 5.2 | -3.3 |
| Old Mutual PLC | 169.7 | 8.3 | 5.1 | -5.1 |
| Tesco PLC | 173.4 | 7.2 | 4.3 | 16.0 |
| Hargreaves Lansdown PLC | 1363 | 56.0 | 4.3 | -9.5 |
| Barclays PLC | 186 | 7.6 | 4.3 | -15.0 |
| UK 100 Laggards | Close (p) | Chg (p) | % Chg | % YTD |
| Glencore PLC | 89.48 | -1.0 | -1.1 | -1.1 |
| Antofagasta PLC | 380.2 | -3.8 | -1.0 | -19.0 |
| BHP Billiton PLC | 676.4 | -3.2 | -0.5 | -11.0 |
| GKN PLC | 278.8 | 0.5 | 0.2 | -9.6 |
| SABMiller PLC | 4182.5 | 12.5 | 0.3 | 2.8 |
| Major World Indices | Mid/Close | Chg | % Chg | % YTD |
| UK UK 100 | 6,083.8 | 152.0 | 2.56 | -2.5 |
| UK | 16,487.7 | 291.2 | 1.80 | -5.4 |
| FR CAC 40 | 4,417.0 | 94.9 | 2.19 | -4.8 |
| DE DAX 30 | 9,798.1 | 158.5 | 1.64 | -8.8 |
| US DJ Industrial Average 30 | 16,466.3 | 396.5 | 2.47 | -5.5 |
| US Nasdaq Composite | 4,614.0 | 107.3 | 2.38 | -7.9 |
| US S&P 500 | 1,940.2 | 46.9 | 2.48 | -5.1 |
| JP Nikkei 225 | 17,865.2 | 346.9 | 1.98 | -6.1 |
| HK Hang Seng Index 48 | 19,541.0 | -142.1 | -0.72 | -10.8 |
| AU S&P/ASX 200 | 5,043.6 | 38.1 | 0.76 | -4.8 |
| Commodities & FX | Mid/Close | Chg | % Chg | % YTD |
| Crude Oil, West Texas ($/barrel) | 32.89 | -0.28 | -0.83 | -11.3 |
| Crude Oil, Brent ($/barrel) | 35.24 | 0.06 | 0.17 | -6.3 |
| Gold ($/oz) | 1121.25 | 2.85 | 0.25 | 5.7 |
| Silver ($/oz) | 14.31 | 0.06 | 0.4 | 3.5 |
| GBP/USD – US$ per £ | 1.43 | – | 0.04 | -3.3 |
| EUR/USD – US$ per € | 1.08 | – | 0.18 | -0.1 |
| GBP/EUR – € per £ | 1.31 | – | -0.13 | -3.2 |
Click graph to enlarge
UK 100 Index called to open +20pts at 6105, after a late Friday breakout from the bullish complex head & shoulders reversal pattern highlighted last week. Breakout adds to strong reversal from 3.5 year lows 5600. Overnight sideways action potentially a simple consolidation pause before a second leg higher towards 8-month falling highs at 6200, although completion of H&S pattern could mean upside to late 2015 highs around 6400. Bullish 6135, Bearish 6085.
The positive opening call comes after US bourses held strong gains into Friday’s close and despite a mixed Asian session overnight to start the new month. This after Chinese PMI data showed continued Manufacturing contraction (6-month low), adding to global economic woes, even if the now dominant Services remained buoyant.
Chinese/Hong Kong stocks lower although hopes of more stimulus remain rife and faith in global central banking largesse unabated to counter risk of another recession of which economists attribute a 20% probability in the US (blame the Fed?).
Japan’s Nikkei extending gains on the back of Friday’s BoJ decision to take interest rates negative to boost lending, inflation and growth, weakening the JPY and thus helping exporters, all the while leaving room for more direct stimulus further down the line. Note Australia’s ASX dented by disappointing Chinese/Korean manufacturing data and Oil off its highs but helped by a weaker AUD.
US markets ended last week on the front foot after the BoJ cut rates into negative territory and the oil price recovered a bit on spurious claims by Russia that it was coming to save us all. Sorry, coming to save those of us who don’t like cheap energy.
In Fed news, Dallas governor Kaplan said the Fed needs time to assess how perceived global economic weakness and stock market swings will affect the US, returning the word ‘patient’ to replace ‘balanced’ - which was dropped when referring to economic risks in the last statement. Markets no doubt lauding a hold-off in further policy tightening then.
In focus today we have Eurozone & UK PMI Manufacturing for January seen giving up some ground with all but France holding above the key 50.0 growth/contraction level. UK Mortgage Approvals and Consumer Credit will be eyed for hints about the UK Housing market and Consumer Confidence.
In the afternoon, after weak US GDP data last week added to hopes of a shallower trajectory for Fed rate rises, keep an eye on US Personal Income and Spending especially given expectations that the low oil price should begin delivering a consumer boon. In contrast to elsewhere, US PMI Manufacturing is expected to have jumped in Jan, although ISM Manufacturing likely remained sub-50.
In Oil world, a deal to cut oil production that’s looking as unlikely as it did last week - that’s very unlikely by the way - and Chinese data that came in a tad soft are levelling off crude prices this morning. A stronger USD also not helping. Not a lot of price action thus far, but things could get volatile since all the drivers are pretty negative.
Hopes of a supply cut drifted further away after Iran said it “won’t consider it” until exports have increased by 1.5m barrels per day (they’re currently a paltry 1.1m). Note, for what it’s worth, Africa’s top oil producer Nigeria putting out feelers for a potential world bank loan to fund an oil-induced budget deficit.
Gold had its best month in a year in Jan - hardly surprising given its safe haven job description. While some will say that rising US interest rates will keep the pressure on Gold, the yellow metal is still looking oversold at the moment and the actual outlook for US rates is rather dovish. Note however a surge in USD strength after the BoJ cut Japan’s interest rate to negative, which could weigh in the shorter term.
For any help you may require placing trades or in terms of market information, put a call in to our trading floor – it’s all part of the service.
This research is produced by Accendo Markets Limited. Research produced and disseminated by Accendo Markets is classified as non-independent research, and is therefore a marketing communication. This investment research has not been prepared in accordance with legal requirements designed to promote its independence and it is not subject to the prohibition on dealing ahead of the dissemination of investment research. This research does not constitute a personal recommendation or offer to enter into a transaction or an investment, and is produced and distributed for information purposes only.
Accendo Markets considers opinions and information contained within the research to be valid when published, and gives no warranty as to the investments referred to in this material. The income from the investments referred to may go down as well as up, and investors may realise losses on investments. The past performance of a particular investment is not necessarily a guide to its future performance. Prepared by Michael van Dulken, Head of Research