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| Yesterday’s UK 100 Leaders | Close (p) | Chg (p) | % Chg | % YTD |
| Anglo American PLC | 1677 | 50 | 3.1 | 8.2 |
| Sainsbury (J) PLC | 248.4 | 7.4 | 3.1 | 2.9 |
| Micro Focus International PLC | 2201 | 56 | 2.6 | -12.8 |
| Smurfit Kappa Group PLC | 2488 | 62 | 2.6 | -0.8 |
| Marks & Spencer Group PLC | 318.3 | 7.5 | 2.4 | 1.1 |
| Yesterday’s UK 100 Laggards | Close (p) | Chg (p) | % Chg | % YTD |
| United Utilities Group PLC | 782.2 | -29.8 | -3.7 | -5.7 |
| Severn Trent PLC | 2063 | -68 | -3.2 | -4.6 |
| Centrica PLC | 141.4 | -3.7 | -2.5 | 3.0 |
| National Grid PLC | 850.7 | -13.9 | -1.6 | -2.8 |
| SSE PLC | 1310 | -19.5 | -1.5 | -0.8 |
| Major World Indices | Mid/Close | Chg | % Chg | % YTD |
| UK UK 100 | 7,731.0 | 34.5 | 0.45 | 0.6 |
| UK | 20,875.0 | 18.3 | 0.09 | 0.7 |
| FR CAC 40 | 5,523.9 | 36.5 | 0.67 | 4.0 |
| DE DAX 30 | 13,385.6 | 17.8 | 0.13 | 3.6 |
| US DJ Industrial Average 30 | 25,385.8 | 102.8 | 0.41 | 2.7 |
| US Nasdaq Composite | 7,163.6 | 6.2 | 0.09 | 3.8 |
| US S&P 500 | 2,751.3 | 3.6 | 0.13 | 2.9 |
| JP Nikkei 225 | 23,788.2 | -61.8 | -0.26 | 4.5 |
| HK Hang Seng Index 50 | 31,135.6 | 124.2 | 0.40 | 4.1 |
| AU S&P/ASX 200 | 6,096.7 | -39.1 | -0.64 | 0.5 |
| Commodities & FX | Mid/Close | Chg | % Chg | % YTD |
| Crude Oil, West Texas Int. ($/barrel) | 63.45 | 1.09 | 1.74 | 5.6 |
| Crude Oil, Brent ($/barrel) | 69.14 | 0.90 | 1.32 | 3.8 |
| Gold ($/oz) | 1309.25 | -2.36 | -0.18 | 0.5 |
| Silver ($/oz) | 16.97 | -0.16 | -0.95 | 0.6 |
| GBP/USD – US$ per £ | 1.3519 | – | -0.08 | 0.1 |
| EUR/USD – US$ per € | 1.1928 | – | -0.01 | -0.6 |
| GBP/EUR – € per £ | 1.1335 | – | -0.07 | 0.7 |
Click graph to enlarge
UK 100 Index called to open -5pts at 7725, trading in the middle of a 7715-7735 range. Bulls need a break higher to challenge Monday’s record. Bears need a breach to open the door for another test of 7700. Overall uptrend slowed up. Consolidation or topping out? Watch levels: Bullish 7735, Bearish 7715
Calls for a slightly negative open can be attributed to Asian equities losing steam despite another quartet of Wall St records, as some call a bear market for bonds (yields up, prices down) and a market turnaround.
Mixed China inflation (CPI accelerating, but not as fast as hoped; PPI slowing slightly less than expected) has dented commodities and thus Aussie Miners overnight, which may flow through to the UK Index following sector gains yesterday. A stronger USD is also hurting metals although Oil prices remain strong after last night's US inventory data.
Like yesterday, UK Retail will again be in focus this morning after Sainsbury’s Xmas trading update and guidance upgrade, as could Housebuilders following Taylor Wimpey’s latest communication.
In UK corporate news this morning: Taylor Wimpey expects to report FY results in line with consensus, with further growth and performance improvement in 2018. Sainsbury Q3 like-for-like sales ex-fuel marginally better than consensus, expects underlying full year profits moderately ahead of consensus thanks to greater Argos synergies. Paddy Power Betfair appoints CEOs for European and Australian operations. Tullow Oil expects higher full year free cash flow than expectations.
Big Yellow Group Q3 revenue growth accelerates to +8% (H1 +5.7%) driven by higher occupancy, but also improved average net achieved rents. Pagegroup FY gross profit +9.9% (constant FX), operating profit expected ahead of consensus but within consensus range. Superdry revenues and profits +20%, confident FY underlying pre-tax profit in line with consensus; interim div +19%.
US equity markets continued their record start to the year, with the S&P 500 enjoying its best opening 6-day performance since 1987. The index closed at another fresh record high ahead of key Q4 reports from US Banks later this week, however it was the Dow Jones that outperformed, climbing over 100 points as Boeing touched a fresh all-time high, while the Tech-focused Nasdaq also notched a fresh record close.
Crude Oil prices have notched fresh 3-year highs overnight following API reporting an immense 11.2m barrel drawdown in US inventories, its sixth consecutive of 5m or more. Global benchmark Brent has topped the $69 mark, fast approaching the $70 level not seen since November 2014, while its US equivalent has charged above $63. Watch official US EIA inventories later today for a confirmation or dispelling of the massive API drawdown.
Gold has found shallow rising support around $1309 having broken down from its $1315-$1320 narrowing channel yesterday morning. The precious metal now needs to overcome falling highs around $1312 in order to recover yesterday’s losses, however it will likely be at the mercy of the rejuvenated US dollar, having recovered from its lows..
In focus today will be UK Industrial Production growth (9.30am), forecast to pick up from flat, although annual growth likely slowed, having peaked in Oct, now facing a tougher comparable. The same is true for UK Manufacturing Production, however contraction in Construction growth is seen worsening alongside a largely unchanged Trade deficit. All could move GBP and thus UK Index .
The UK NIESR GDP Estimate (1pm) is seen unchanged at 0.5% in the three months to end-Dec before US Import Prices growth (1.30pm) cools. The former could move GBP, the latter USD.
After a sixth straight US API Crude Stock drawdown last night (a whopping 12m barrels vs 4m est) watch out for this afternoon’s official EIA data which could see an extension of a 7-week run of drawdowns. As per usual, Gasoline and Distillates inventories, as well as overall US production, have potential to overshadow.
Fed speakers today include a trio of non-voters. Chicago’s Evans (2pm, dovish) discusses current economic conditions or monetary policy with audience & media Q&A. Dallas’ Kaplan (2.10pm, neutral) participates in moderated discussion on the Weitzman Annual Retail Forecast. St Louis’ Bullard (6.30pm, dovish) presents "U.S. Economy & Monetary Policy" with audience Q&A.
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