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| UK 100 Leaders | Close (p) | Chg (p) | % Chg | % YTD |
| Barratt Developments PLC | 516 | 18.0 | 3.6 | 11.6 |
| ITV PLC | 208.6 | 5.6 | 2.8 | 1.1 |
| Kingfisher PLC | 353 | 8.8 | 2.6 | 0.8 |
| St James’s Place PLC | 1085 | 26.0 | 2.5 | 7.0 |
| Shire PLC | 4661.5 | 106.5 | 2.3 | -0.5 |
| UK 100 Laggards | Close (p) | Chg (p) | % Chg | % YTD |
| Rolls-Royce Group PLC | 661.5 | -15.5 | -2.3 | -1.0 |
| Marks & Spencer Group PLC | 339.1 | -5.8 | -1.7 | -3.1 |
| Randgold Resources Ltd | 6710 | -85.0 | -1.3 | 4.6 |
| Smurfit Kappa Group PLC | 2129 | -24.0 | -1.1 | 13.0 |
| Paddy Power Betfair PLC | 8645 | -95.0 | -1.1 | -1.5 |
| Major World Indices | Mid/Close | Chg | % Chg | % YTD |
| UK UK 100 | 7,337.8 | 45.4 | 0.62 | 1.8 |
| UK | 18,372.0 | 68.4 | 0.37 | 0.2 |
| FR CAC 40 | 4,922.5 | 58.5 | 1.20 | 0.3 |
| DE DAX 30 | 11,629.2 | 108.2 | 0.94 | 0.3 |
| US DJ Industrial Average 30 | 19,885.8 | -5.3 | -0.03 | -0.4 |
| US Nasdaq Composite | 5,574.1 | 26.6 | 0.48 | 1.0 |
| US S&P 500 | 2,274.6 | 4.2 | 0.18 | -0.1 |
| JP Nikkei 225 | 19,095.2 | -192.0 | -1.00 | -0.1 |
| HK Hang Seng Index 50 | 22,720.7 | -216.7 | -0.94 | 3.3 |
| AU S&P/ASX 200 | 5,748.4 | 27.3 | 0.48 | 1.5 |
| Commodities & FX | Mid/Close | Chg | % Chg | % YTD |
| Crude Oil, West Texas Int. ($/barrel) | 52.32 | -0.12 | -0.22 | -2.6 |
| Crude Oil, Brent ($/barrel) | 55.43 | -0.09 | -0.16 | -2.5 |
| Gold ($/oz) | 1205.75 | 8.45 | 0.71 | 2.8 |
| Silver ($/oz) | 16.92 | 0.08 | 0.49 | 2.4 |
| GBP/USD – US$ per £ | 1.2029 | -0.0258 | -1.27 | -2.1 |
| EUR/USD – US$ per € | 1.0615 | 0.0081 | -0.26 | 0.8 |
| GBP/EUR – € per £ | 1.1331 | -0.0338 | -1.01 | -2.9 |
Click graph to enlarge
UK 100 Index called to open +10pts at 7350, extending its month-long rising channel. An overnight bounce from 7340 keeps the index above Friday’s close but also maintains steeper ascent from Thursday's lows. This could mean a bearish rising wedge forming, coinciding with completion of the bullish inverse head and shoulders pattern we were harping on about last week. The daily RSI look like it may be starting to plateau too. Bulls will want to see a break above 7365 overnight highs. Bears will want to see 7340 give way. Watch levels: Bullish 7365, Bearish 7335.
Calls for a positive open comes after a positive US close on Friday (helped by Banks results) and a largely positive start to the week in Asia. Gains for UK blue-chips are derived less from shareholder optimism and more from another dollop of perversely helpful Sterling (GBP) weakness overnight, flattering the value of international profits, as markets gear up to hear what UK PM May has to say about Brexit (long overdue), currency traders clearly speculating about hard Brexit rhetoric.
While this UK Index /GBP relationship continues to perversely assist UK blue-chips (UK Index rallying on Brexit fears) note that after President elect Trump disappointed last week by failing to disclose more details on stimulus, any failure by him to do so at Friday’s inauguration could result in the US Dollar weakening into next weekend. This would likely send GBP higher, dealing a blow to the UK Index , potentially helping usher it from its highs.
Japan’s Nikkei is higher in spite of Yen strength while Australia’s ASX benefits from gains in resources-focused stocks, some welcome M&A and Friday’s positive US banks results
US equities finished last week flat to positive as positive fourth quarter earnings saw the Financial sector outperform. While the Dow Jones closed flat as Banking heavyweight JP Morgan helped to offset Pharmaceutical and Retail weakness, both the S&P and Nasdaq closed higher, +0.2% and +0.5% respectively.
Crude Oil prices are opening the week on the back foot having been unable to overcome 2017 falling highs resistance on Friday, although both Brent and US Crude ($55.50, $52.35) remain above last Tuesday’s 3-month lows. Ongoing reports of OPEC compliance will be key to market sentiment throughout the week given continued scepticism some analysts still hold over the effectiveness of the cartel’s production cuts to reduce the global oversupply and push prices back above $60 per barrel.
Gold is once again trading above $1200, on course for its sixth straight session of gains as the US Dollar remains relatively weak heading into this week’s high risk events. Donald Trump’s inauguration and Theresa May’s Brexit plans will headline the schedule, with another lively performance from the former on Friday likely to influence FX markets and consequently the Dollar-denominated yellow metal.
This week’s main event will of course be the Trump inauguration on Friday (5pm UK time), however, UK Prime Minister Theresa May’s long-awaited ‘Brexit plan’ speech on Tuesday may well hog UK headlines given the potential for updates on the government’s hitherto muddled stance on divorce from the EU especially regarding retention of single market access. Soundbites from the World Economic Forum in Davos may also garner attention given the new political landscape that business titans are facing.
Martin Luther King day in the US sees many markets shut on the other side of the pond today. With that in mind, in focus data-wise today will be the EU Trade Balance, with forecasts suggesting that the surplus has increased. Note that this would confirm the UK’s figure last week, having shown its trade deficit with the EU at its highest ever level, adding yet more importance to the (presumably) imminent Brexit negotiations.
Elsewhere, Italian CPI is expected to swing into positive territory from negative in the monthly figures, whilst the yearly is seen accelerating to 0.7% from 0.1% previously, although these figures may surprise further to the upside after the barrage of positive CPI readings across Europe two weeks ago. That’ll keep a smile on ECB president Draghi’s face and wolf Weidmann from the door.
The void of macro data is thankfully filled by several speakers, with a trifecta of ECB speakers - Messrs Villeroy, Mersch and Praet - taking to the stand throughout the day, while Bank of England Governor Mark Carney speaks at the London School of Economics after the market close.
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