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| Yesterday’s UK 100 Leaders | Close (p) | Chg (p) | % Chg | % YTD |
| Whitbread | 4045 | 86.0 | 2.2 | 7.1 |
| International Consolidated Airlines | 611 | 12.5 | 2.1 | 38.6 |
| Royal Bank of Scotland Group | 249.8 | 4.2 | 1.7 | 11.2 |
| TUI | 1150 | 17.0 | 1.5 | -1.1 |
| easyJet | 1356 | 19.0 | 1.4 | 34.9 |
| Yesterday’s UK 100 Laggards | Close (p) | Chg (p) | % Chg | % YTD |
| Fresnillo | 1555 | -50.0 | -3.1 | 27.4 |
| Antofagasta | 751 | -21.0 | -2.7 | 11.3 |
| Provident Financial | 2399 | -41.0 | -1.7 | -15.8 |
| Randgold Resources | 7000 | -115.0 | -1.6 | 9.1 |
| Rolls-Royce Group | 930.5 | -11.5 | -1.2 | 39.3 |
| Major World Indices | Mid/Close | Chg | % Chg | % YTD |
| UK UK 100 | 7,446.8 | 22.7 | 0.31 | 4.3 |
| UK | 19,684.6 | -0.5 | 0.00 | 8.9 |
| FR CAC 40 | 5,295.8 | 29.6 | 0.56 | 8.9 |
| DE DAX 30 | 12,770.8 | 37.4 | 0.29 | 11.2 |
| US DJ Industrial Average 30 | 21,409.5 | 14.8 | 0.07 | 8.3 |
| US Nasdaq Composite | 6,247.2 | -18.1 | -0.29 | 16.1 |
| US S&P 500 | 2,439.1 | 0.8 | 0.03 | 8.9 |
| JP Nikkei 225 | 20,225.1 | 71.7 | 0.36 | 5.8 |
| HK Hang Seng Index 50 | 25,816.9 | -55.0 | -0.21 | 17.3 |
| AU S&P/ASX 200 | 5,714.2 | -6.0 | -0.10 | 0.9 |
| Commodities & FX | Mid/Close | Chg | % Chg | % YTD |
| Crude Oil, West Texas Int. ($/barrel) | 43.45 | 0.34 | 0.78 | -2.8 |
| Crude Oil, Brent ($/barrel) | 45.95 | 0.42 | 0.92 | -2.9 |
| Gold ($/oz) | 1245.95 | 2.15 | 0.17 | -0.7 |
| Silver ($/oz) | 16.55 | 0.01 | 0.08 | -0.7 |
| GBP/USD – US$ per £ | 1.2733 | – | 0.07 | -0.4 |
| EUR/USD – US$ per € | 1.1193 | – | 0.09 | 0.1 |
| GBP/EUR – € per £ | 1.1375 | – | -0.03 | -0.4 |
Click graph to enlarge
UK 100 Index called to open flat at 7445, in retreat from 7460 overnight highs but holding above yesterday’s 7440 breakout. Bulls are encouraged by continued consolidation above 7400, thanks to April resistance-turned-support. Bears point to falling highs since last Tuesday’s 7560 peak. Watch levels: Bullish 7460, Bearish 7440.
A mixed opening call (UK Index & Dow flat, DAX lower) echoes stateside and Asian sessions overnight. This despite oil prices continuing to firm, challenging the ceiling of their 1-month falling channel, most recently thanks to fresh USD weakness ahead of what could be more disappointing US data, mixed Fed rhetoric and uncertainty about the US healthcare bill and future Trump stimulus.
Whilst the USD has given a welcome boost to commodities (notably Gold) it, however, risks unwelcome GBP and EUR strength that could hinder the UK Index and DAX. Note supportive China Industrial Profits data overnight and a positive speech from China Premier Li.
Japan’s Nikkei outperforms, posting gains thanks to Yen weakness and Oil gains helping Energy. In stark contrast, Australia’s ASX is offside, but off its worst, as Miners react to a gold sell-off yesterday which has already retraced half of yesterday’s losses, and base metals benefit from China data and comments. China underperforms, giving up more of its recent MSCI inspired gains, failing to react to pro-growth comment from Premier Li.
US equity markets were mixed in the opening session of the week, as the Dow Jones and S&P500 closed just above breakeven, while negative closes for large cap Tech stocks Alphabet, Amazon and Facebook after initially opened higher saw the Nasdaq underperform (-0.3%). Financials led the way for both the Dow and S&P, offsetting weakness from manufacturing giant Boeing and IT respectively.
Crude Oil prices have recovered from yesterday’s late afternoon sell-off to trade fresh week highs, which has seen both Brent and US benchmarks challenge resistance at last Wednesday’s pre-EIA highs of $46.20 and $43.80 respectively. This comes as the US dollar weakens against peers in early morning trade, making the relative price of commodities cheaper. An extended rally to beyond $46.50 (Brent) and $44 (US) could see both measures break out from 1-month downtrends.
Gold was subject to a mysterious $10 drop yesterday, with some reports blaming a potential ‘fat finger’ trade, which had placed the precious metal on the back foot overnight. However, this morning’s US dollar sell off has helped Gold to pare a significant amount of losses, rallying back above $1250 for the first time since yesterday morning’s sell-off. Continue to watch USD for market sentiment.
In focus today, aside fallout from UK PM May’s £1bn pact with the DUP to ensure a working parliamentary majority, and mixed response to her Brexit offer on EU citizens’ rights, will be data including UK CBI Sales which are seen improving in June.
The latest read for S&P Corelogic Housing (2pm) is forecast to indicate growth slowing in April but remaining strong annual basis while US Consumer Confidence (3pm) may have dipped in June.
The US Richmond Fed manufacturing Index (3pm) should rebound in June after last month’s sharp pullback to near breakeven. Note, however, mixed prints from peers with yesterday’s Dallas Fed a touch light, Chicago off the pace last week but both Kansas & Philly showing improvements.
The speaker roster is packed today, with a particularly strong showing from the US Federal Reserve. This morning, Fed non-voter Williams (9:05am; hawkish) speaks a couple of hours before Bank of England Governor Mark Carney (11am; very dovish) who will discuss the findings of the latest BoE Financial Stability Report (10:30am). Any more hints on UK rates outlook?
This afternoon, the battle of the hawks versus doves takes places, as voters Harker (hawk; 4pm) and Kashkari (very dovish; 10:30pm) discuss monetary policy, the former alongside the always influential Fed Chair Janet Yellen (dovish; 4pm), who will be looked to for further insight into policy outlook and further hikes, especially in light of yet more poor stateside data yesterday.
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