This report is not a personal recommendation and does not take into account your personal circumstances or appetite for risk.
| Yesterday’s UK 100 Leaders | Close (p) | Chg (p) | % Chg | % YTD |
| Pearson | 893.6 | 63.6 | 7.7 | 21.4 |
| International Consolidated Airlines | 678 | 37.4 | 5.8 | 4.2 |
| Reckitt Benckiser | 5727 | 167 | 3.0 | -17.2 |
| BHP Billiton | 1601.4 | 43.4 | 2.8 | 5.2 |
| BP | 558.1 | 14.2 | 2.6 | 6.8 |
| Yesterday’s UK 100 Laggards | Close (p) | Chg (p) | % Chg | % YTD |
| Berkeley Group | 4076 | -47 | -1.1 | -2.9 |
| HSBC | 714.4 | -6.9 | -1.0 | -6.9 |
| Randgold Resources | 6050 | -58 | -1.0 | -18.4 |
| Next | 5144 | -36 | -0.7 | 13.7 |
| RSA Insurance | 637.2 | -2.8 | -0.4 | 0.7 |
| Major World Indices | Mid/Close | Chg | % Chg | % YTD |
| UK UK 100 | 7,567.1 | 64.5 | 0.86 | -1.6 |
| UK | 20,422.0 | 56.0 | 0.28 | -1.5 |
| FR CAC 40 | 5,531.4 | 15.4 | 0.28 | 4.1 |
| DE DAX 30 | 12,948.1 | 128.5 | 1.00 | 0.2 |
| US DJ Industrial Average 30 | 24,357.3 | 94.8 | 0.39 | -1.5 |
| US Nasdaq Composite | 7,265.2 | 55.6 | 0.77 | 5.2 |
| US S&P 500 | 2,672.6 | 9.2 | 0.35 | 0.0 |
| JP Nikkei 225 | 22,499.5 | 32.3 | 0.14 | -1.2 |
| HK Hang Seng Index 50 | 30,364.7 | 370.4 | 1.23 | 1.5 |
| AU S&P/ASX 200 | 6,089.2 | 4.7 | 0.08 | 0.4 |
| Commodities & FX | Mid/Close | Chg | % Chg | % YTD |
| Crude Oil, West Texas Int. ($/barrel) | 69.95 | -0.09 | -0.12 | 16.4 |
| Crude Oil, Brent ($/barrel) | 75.50 | -0.06 | -0.07 | 13.3 |
| Gold ($/oz) | 1311.95 | -4.15 | -0.32 | 0.7 |
| Silver ($/oz) | 16.42 | -0.01 | -0.03 | -2.7 |
| GBP/USD – US$ per £ | 1.3553 | – | -0.12 | 0.4 |
| EUR/USD – US$ per € | 1.1916 | – | -0.14 | -0.7 |
| GBP/EUR – € per £ | 1.1373 | – | 0.03 | 1.1 |
Click graph to enlarge
UK 100 Index called to open flat at 7565, having fallen back below 7570 following yesterday’s flirt with 7600. The rising channel from late March remains valid, but Bulls likely need a break back above 7585. Bears require a breach of 7560 to open the door to for a drop back towards the 7530 channel floor. Watch levels: Bullish 7585, Bearish 7560
Calls for a flat open come in spite of gains on Wall St yesterday and in Asia overnight. The index is nonetheless supported by a still depressed GBP while USD remains strong, both currencies at opposite ends of the spectrum of rate hike expectations ahead of their next policy meetings, the BoE this week and the Fed in June.
Overnight, China’s April Trade Balance rebounded from March’s seasonal early year dip which may help UK Index Miners. Oil is off its highs, but still very strong, on optimism about Trump not pulling out of the Iranian nuclear deal, which may impact big Energy names.
We also have more M&A with Comcast throwing in a bid for Fox/Sky to disrupt Disney, and Challenger bank CYBG proposing an all share deal with Virgin Money. Italy looks set to return to the ballot box, but as we have seen for a while now, equity markets don't have a problem with political gridlock/inertia (e.g. UK, US, Germany, Italy) in terms of it implying less legislative risk to disrupt the trend.
In corporate news this morning Shire and Takeda have agreed to the 25 April merger proposal, Comcast is preparing a rival bid to crash the Walt Disney-Fox(-Sky) deal and Royal Dutch Shell has sold its interest in Canadian Natural Resources for $3.3bn. Standard Life Aberdeen is challenging Lloyds Banking decision to terminate £109bn investment management arrangement.
Among the UK challenger banks, CYBG has approached Virgin Money about an all-shar tie up, offering a 15% premium. Paragon Banking notes press speculation about a possible acquisition of Titlestone, the residential development finance lender, and says in early stages of consideration.
Hiscox Q1 gross written premiums +20.3% (+24% in US$), growing strongly after a costly 2017 for catastrophes, but “discipline and good sense is receding in the market” so growth ion big-ticket business “will be more measured”. AstraZeneca and Luye Pharma have entered an agreement for the sale and licence of the rights to Seroquel and Seroquel XR in the UK, China and other international markets.
Unilever starts previously announced €6bn share buyback programme. UK Competition Watchdog refers SSE-Npower merger for further investigation. William Hill sees 2018 in line with views as 4-Month revenue rise 3%, strong US offsetting weakness in UK retail and Sportsbook.
Oil prices were flirting with 3-year highs at $70.08/75.60 (+0.06%) as traders were waiting on word from the White House on President Trump’s decision to stay or leave Iranian nuclear deal. With Iran having added over 1 million barrels of daily output ever since sanctions were lifted in 2015, any threat to supply can send oil prices much higher. Gold kept steady once again at $1312/troy ounce (-0.23%), as the Dollar Index remained near 2018 highs due to strong US economic growth data and low unemployment figures.
In focus today will be UK Halifax Housing Prices (8:30am) expected to slightly decrease MoM by -0.2%, while still showing annual growth of 3.3%, up from 2.7% the previous month, with potential read-across for the UK Banks and Housebuilders. Later in the day will see US JOLTs Job Openings for March (3:00pm), with consensus holding for an improvement to 6.1M, following the previous month’s decline. Finally, this evening, we get the latest API Oil Inventories data (9:30pm) which could move oil prices, but not before Trump’s Iran nuclear deal decision at 7pm.
Big name US companies reporting Q1 results today include entertainment companies Electronic Arts and Walt Disney (involved in M&A), as well as online business TripAdvisor and hotel chain Marriott International. In terms of speakers, Fed chairman Powell speaks today (8:15am) to add further clarity to last week’s interest rate decision.
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