Financial Market Comments from Will Hedden, Sales Trader, IG Index.

After a choppy start, the FTSE spread betting market is working hard to stay in positive territory.

Yesterday’s bumper gains in London may have left traders tempted to start booking some quick profits but further signs of a weakening housing market in the UK are doing nothing to suggest cash yields will be improving any time soon.

As a result this does seem to be giving London based FTSE the edge over mainland Europe, not least given the signs of tighter monetary policy that are now emerging from Sweden with a quarter point hike in its repo rate.

Whether traders will be inclined to hold onto this optimism remains to be seen however, as tomorrow’s Non Farm payroll figures from the US are now looming and, given the shortfall in the ADP reading, expectations are certainly muted.

What earnings news we have seen this morning has brought little to the table: DSG failed to impress with its trading update, but BG Group and Autonomy are both sitting higher as bid chatter surfaces.

Any hints over policy from the ECB will be closely followed, although the long weekend has knocked the BoE’s meeting back to next week.

Looking ahead to the US session, weekly jobless claims and pending home sales data may offer further direction but at present we’re eyeing a broadly unchanged start for the major US indices.

Spread betting carries a high level of risk to your capital. You may lose more than your initial investment. It may not be suitable for all investors. Only speculate with money that you can afford to lose. Please ensure you fully understand the risks involved and seek independent financial advice where necessary.

Good Luck!

DB

The above comments do not constitute investment advice and Clean Financial accepts no responsibility for any use that may be made of them.

Content provided by IG Index which is Authorised and regulated by the Financial Services Authority. FSA Register number 114059.

Financial Market Comments from David Jones, Chief Market Strategist, IG Index.

The FTSE 100 has started the new month promisingly, as recent pieces of better-than-expected data have put some fire back into markets.

Miners have been boosted by news that China’s official purchasing managers’ index rose to 51.7 in August, up 0.5 points from July.

The news benefited the FTSE’s mining sector in particular, with Fresnillo up 3.67% and Xstrata and Kazakhmys both adding 1.90% to their share price.

While we have seen a broadly decent start for equities, investors are certainly not leaping headlong into risk assets.

To put the morning’s gains into context, we are still well below the 5300 resistance level.

Recent data from the US and China has not been spectacular, it has simply not been damningly disappointing.

While this is in itself an improvement on the range of soft numbers that have been keeping share prices on both sides of the Atlantic firmly under the cosh, it is unlikely to spark any significant rally on its own.

That said, the month has started well and has certainly set the tone for possible further gains on the spread trading markets, but only if they can be underpinned by decent numbers.

Spread betting carries a high level of risk to your capital. You may lose more than your initial investment. It may not be suitable for all investors. Only speculate with money that you can afford to lose. Please ensure you fully understand the risks involved and seek independent financial advice where necessary.

Good Luck!

DB

The above comments do not constitute investment advice and Clean Financial accepts no responsibility for any use that may be made of them.

Content provided by IG Index which is Authorised and regulated by the Financial Services Authority. FSA Register number 114059.

Financial Market Comments from Yusuf Heusen, Senior Sales Trader, IG Index.

In mid-morning trading the FTSE 100 is trying to stage a recovery after a sharp initial decline.

The FTSE 100 gave an impression of suffering the after-effects of overindulgence following the bank holiday weekend, dropping around 70 points at the bell this morning. However, by mid-morning the index seems to have found room for a good breakfast and is attempting something of a modest recovery.

The decline has been led by a sell-off among miners and sounds-like-a-stuck-record concerns over the strength of the US recovery.

Regarding the miners, Eurasian, Kazakhmys, Xstrata and Vedanta Resources are among the leading losers this morning, all down around 2% as base metals prices retreated.

The latest US concerns have risen out of worries that reports today will show that US home prices slowed in June and consumer confidence is approaching five-month lows.

Sterling too has had a disappointing morning, dropping against 15 of its 16 most-actively traded peers, including 0.3% against the Dollar, ahead of a report that economists say will reveal fewer lender-approved mortgages last month.

It’s only really been ARM Holdings (+4.17%) and Cable & Wireless (+2.07%) that have bucked the trend thus far today, although as the morning has progressed we’ve seen more life from London’s blue chips.

After an initial drop of some 70 points, by 10am (London time) the FTSE had arrested the fall and was last seen looking slightly better off.

Spread betting carries a high level of risk to your capital. You may lose more than your initial investment. It may not be suitable for all investors. Only speculate with money that you can afford to lose. Please ensure you fully understand the risks involved and seek independent financial advice where necessary.

Good Luck!

DB

The above comments do not constitute investment advice and Clean Financial accepts no responsibility for any use that may be made of them.

Content provided by IG Index which is Authorised and regulated by the Financial Services Authority. FSA Register number 114059.

• European stock market futures are pointing to a positive start after late Friday evening rally in the US.
• This comes on the back of Friday’s comments from US FOMC chairman Ben Bernanke that the Fed is prepared to do whatever it takes to get the economy back on track.
• Things were looking even better until the emergency meeting from the Bank of Japan failed to live up to expectations. Traders were hoping and looking for a bigger stimulus injection than was announced.
• The yen has reversed its early losses on the news, with a 1% reversal on the earlier move on the AUD/JPY that actually puts the yen in credit for the day.
• Risk appetite has swung back to cautious mode, with the EUR/USD down 0.2%.
• It is a bank holiday in the UK today so the GBP/USD and GBP/JPY may not act as they usually do.

Spread betting carries a high level of risk to your capital. You may lose more than your initial investment. It may not be suitable for all investors. Only speculate with money that you can afford to lose. Please ensure you fully understand the risks involved and seek independent financial advice where necessary.

Commentary by Dave Evans, BetOnMarkets.

Good Luck!

DB

The above comments do not constitute investment advice and neither Clean Financial nor any contributing author or contributing company accepts any responsibility for any use that may be made of them.

Where to Spread Bet on BHP Billiton?

 
You can spread bet on BHP Billiton with any of the following companies:

• Financial Spreads
• IG Index
• Spreadex

BHP Billiton Spread Betting – More Details

 
For more information on trading BHP Billiton, also see BHP Billiton Spread Betting.

Spread Betting on BHP Billiton

If an investor wants to speculate on companies like BHP Billiton then one option could be to spread trade on the BHP Billiton share price.

Looking at the Tradefair site, they are currently pricing the BHP Billiton Rolling Daily market at 1791.1p – 1794.4p. Therefore, an investor could spread bet on the BHP Billiton share price:

• Increasing higher than 1794.4p, or
• Decreasing lower than 1791.1p

When spread trading on UK shares you trade in £x per penny. Therefore, if you invest £4 per penny and the BHP Billiton shares move 5p then there would be a difference to your profits (or losses) of £20. £4 per penny x 5p = £20.

Rolling Daily Equities Markets

You should note that this is a ‘Rolling Daily Market’, therefore there is no set closing date for this market. If your trade is open at the end of the day, it just rolls over to the next day.

If a trade is rolled over and you are spread betting on the market to:

• Move up – then you will usually be charged a small overnight financing fee, or
• Move down – then a small payment is often credited to your account

To learn more about Rolling Daily Markets please see Rolling Daily Spread Betting.

BHP Billiton Rolling Daily Shares Spread Betting Example

Now, if you consider the above spread of 1791.1p – 1794.4p and make the assumptions that:

• you have analysed the markets, and
• you think that the BHP Billiton share price looks like it will increase and move above 1794.4p

then you could decide that you are going to buy at 1794.4p and risk £2 per penny.

With such a bet you win £2 for every penny that the BHP Billiton shares rise higher than 1794.4p. Of course, it also means that you will make a loss of £2 for every penny that the BHP Billiton market falls below 1794.4p.

Put another way, should you buy a spread bet then your profits are found by taking the difference between the final price of the market and the initial price you bought the market at. You then multiply that price difference by the stake.

As a result, if after a few trading sessions the stock rose then you might want to close your spread bet and therefore guarantee your profits.

So if the market rose then the spread might move to 1866.2p – 1869.5p. To settle/close your trade you would sell at 1866.2p. Therefore, with the same £2 stake you would make:

Profit = (Settlement Level – Initial Level) x stake
Profit = (1866.2p – 1794.4p) x £2 per penny stake
Profit = 71.8p x £2 per penny stake
Profit = £143.60 profit

Financial spread trading is not always straightforward. In this case, you wanted the share price to increase. Nevertheless, it can also go down.

If the BHP Billiton share price had fallen then you could close your spread bet in order to limit your losses.

If the market dropped to 1718.1p – 1721.4p then this means you would settle your spread bet by selling at 1718.1p. Therefore, you would make a loss of:

Loss = (Settlement Level – Initial Level) x stake
Loss = (1718.1p – 1794.4p) x £2 per penny stake
Loss = -76.3p x £2 per penny stake
Loss = -£152.60 loss

Note – BHP Billiton Rolling Daily spread betting market quoted as of 27-Aug-10.

 
Spread betting carries a high level of risk to your capital. You may lose more than your initial investment. It may not be suitable for all investors. Only speculate with money that you can afford to lose. Please ensure you fully understand the risks involved and seek independent financial advice where necessary.