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| Yesterday’s UK 100 Leaders | Close (p) | Chg (p) | % Chg | % YTD |
| GKN | 437.4 | 17.4 | 4.1 | 36.9 |
| WPP | 1392 | 37.5 | 2.8 | 3.8 |
| ITV | 171.95 | 3.9 | 2.4 | 3.9 |
| Ferguson | 5590 | 110 | 2.0 | 4.9 |
| Tesco | 207.9 | 3 | 1.5 | -0.7 |
| Yesterday’s UK 100 Laggards | Close (p) | Chg (p) | % Chg | % YTD |
| Micro Focus International | 2211 | -67 | -2.9 | -12.4 |
| NMC Health | 3032 | -70 | -2.3 | 5.1 |
| International Consolidated Airlines | 654.4 | -14.4 | -2.2 | 0.5 |
| Standard Chartered | 816.1 | -16.9 | -2.0 | 4.6 |
| Shire | 3536 | -45 | -1.3 | -9.3 |
| Major World Indices | Mid/Close | Chg | % Chg | % YTD |
| UK UK 100 | 7,769.1 | -9.5 | -0.12 | 1.1 |
| UK | 20,832.8 | -26.6 | -0.13 | 0.5 |
| FR CAC 40 | 5,509.7 | -7.4 | -0.13 | 3.7 |
| DE DAX 30 | 13,200.5 | -44.5 | -0.34 | 2.2 |
| US DJ Industrial Average 30 | 25,803.3 | 228.5 | 0.89 | 4.4 |
| US Nasdaq Composite | 7,261.1 | 49.3 | 0.68 | 5.2 |
| US S&P 500 | 2,786.2 | 18.7 | 0.67 | 4.2 |
| JP Nikkei 225 | 23,951.8 | 236.9 | 1.00 | 5.2 |
| HK Hang Seng Index 50 | 31,748.7 | 409.8 | 1.31 | 6.1 |
| AU S&P/ASX 200 | 6,048.6 | -28.4 | -0.47 | -0.3 |
| Commodities & FX | Mid/Close | Chg | % Chg | % YTD |
| Crude Oil, West Texas Int. ($/barrel) | 64.51 | 0.02 | 0.02 | 7.3 |
| Crude Oil, Brent ($/barrel) | 70.00 | 0.03 | 0.04 | 5.1 |
| Gold ($/oz) | 1341.13 | -0.08 | -0.01 | 2.9 |
| Silver ($/oz) | 17.35 | 0.23 | 1.31 | 2.8 |
| GBP/USD – US$ per £ | 1.3787 | – | -0.05 | 2.1 |
| EUR/USD – US$ per € | 1.2267 | – | 0.00 | 2.3 |
| GBP/EUR – € per £ | 1.1240 | – | -0.06 | -0.1 |
Click graph to enlarge
UK 100 Index called to open +5pts at 7775, after an overnight bounce off 7765 that extends the January rising channel. Off its best levels, Bulls will be looking for a bounce from 7770 that can break above overnight highs of 7785. Bears need a breach of 7770, if not 7765, to encourage a breakdown. Watch levels: Bullish 7785, Bearish 7765
Calls for a muted start come in spite of a positive session in Asia overnight without a lead from the US on account of a market holiday. Reports of coalition talks troubles in Germany has seen the EUR sell off, equating to GBP strength that is a hindrance. Reduced USD weakness also a culprit, as is a negative session for Miners in Australia overnight even after a decent Rio Tinto Q4 production update. Weakness offset by Oil prices holding their highs to support Energy sector.
In UK corporate news this morning: Rio Tinto Q4 hits FY iron ore export targets despite 2017 weather and rail issues. BP to take $1.7bn after tax non-operating charge in Q4 for Deepwater Horizon; FY cash payments now expected at $3bn vs $2bn estimate given in Q3. AB Foods promotes Nick Hampton from CFO to CEO as of 1 April, succeeding Javed Ahmed who retires. Savills stronger than expected end to year; expects FY results ahead of consensus; CEO to retire.
Provident Financial: says consumer Credit Division (CCD) to report pre-exceptional loss of ~£120m, at upper end of guidance; Vanquis Bank and Moneybarn commenced dialogue with FCA about investigations. Greggs FY total sales +7.4%, like-for-like shop sales +3.7%, FY results expected in-line. JD Sports positive H1 trends continued, LFL around +3%, encouraging versus tough comparables; nudges upper end of profits guidance higher.
Halma and National Express expects US Tax reform to positively impact future US after tax earnings, with a small one-off non-cash tax credit. Dunelm reports Christmas like-for-like store sales +1.1% YoY, online +30.5%; Q2 +3.5% and +36.8%, respectively, although margins took a hit. Ashmore Q2 assets under management +$4.5bn, net inflows +$3.6bn and performance +$0.9bn.
US equity markets return to regular hours today following Martin Luther King Jr. Day yesterday, while Citigroup releases Q4 earnings at an estimated time of 1pm.
Crude Oil benchmarks have edged back from yesterday evening’s highs as the USD recovers from its lows, however with the greenback remaining around 3-year lows the retreat has not been pronounced. Brent remains above $70.1, while US crude holds above $64.4, with investors eyeing US and OPEC production alongside the performance of the greenback.
Gold has edged lower overnight, extending its retreat from yesterday morning’s $1345 highs as the US dollar finds tentative support. Further USD strength this morning resulting from Euro weakness has seen the precious metal fall to a low of $1338.
In focus today will be UK inflation (9.30am) for December, with a potential knock on for inflation expectations and thus both GBP and the UK Index .
UK Consumer Price Inflation (CPI) is forecast faster monthly (0.4% vs 0.3% prev). Annually, however, it likely cooled (3.0% vs 3.1% prev) from November’s highest since Mar 2012. The Core metric (ex-food and energy) may have cooled annually (2.6% vs 2.7% prev), ending a 4-month plateau.
The data is unlikely to greatly sway the Bank of England MPC’s current views, although it is sure to be monitoring the current GBP rally, continuing to erode the Brexit inflation of the last 18-months. More of this could see the UK central bank in a position to hike interest rates sooner than markets are perhaps pricing in.
Other data of note today includes US Empire State Manufacturing (1.30pm) which consensus expects to have stayed flat at 18 in January, holding a 5-month low, potentially consolidating before a bounce to 10yr highs that would extend a 2yr uptrend from -18 in Jan 2016.
As the US returns from a long weekend, Citigroup resumes the US Banking Q4/FY results season at 1pm, hot on the heels of both JP Morgan and Wells Fargo last Friday.
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