Posts from — January 2010

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

In mid-morning trading the FTSE 100 is a little lower, but there are no signs of another rout for share prices just yet.

Following sharp falls as London came into the close yesterday, President Obama’s proposals for wholesale reform of the banking sector currently remains the only story in town.

Although so far the FTSE has held steady, not too far off yesterday’s close, drilling down into the blue chip movers reveals where the damage is being done.

The Biggest loser today is inter-dealer broker ICAP, off by around 6% so far, with its revenue a likely casualty if banks have to rein in trading activities.

The next two losers are also unsurprising candidates. Barclays, due to the impact any changes could have on its Barclays Capital division, and London Stock Exchange, due to a potential drop in volumes.

After the sharp falls seen yesterday, markets now seem to be adopting a wait-and-see attitude.

Yesterday’s plans have the potential to change banking as we know it, but judging the reaction by markets today there does seem to be a degree of scepticism as to just what proportion of the proposed changes will make it into legislation.

Looking ahead to the US open, we are currently expecting a slightly positive start to trading for the Dow Jones, estimated at a 10 point rise.

There are no major economic announcements due out today, but with the ongoing banking concerns and earnings results expected from the likes of General Electric and McDonalds, it should be anything but a dull session to finish the week.

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 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 Philip Gillett, Sales Trader, IG Index.

In mid-morning trading the UK’s leading index is in the black, but off earlier highs.

Shortly after 10am the UK 100 was up just 11 points to 5432, following yesterday’s 1.7% drop.

Resources stocks are prominent on the leader board this morning, after the sector took the brunt of Wednesday’s fall.

A turnaround in commodity prices – particularly crude oil and copper – has helped Tullow Oil gain 26p to 1351p, while miner Lonim added 35p to 1915p.

Retailers were mixed following news that Morrisons‘ like-for-like festive sales jumped 6.5%, after the supermarket group said it was cautious and the market remains ‘challenging’.

The FTSE remains below Monday’s starting level and at present there seems little prospect of the index going past the 5500 mark and, more significantly, there.

Across the Atlantic, the Dow Jones also lost in excess of 1% yesterday.

Monday’s warnings about how painful and slow the recovery is likely to be seem to have overshadowed the week’s more positive data, such as the first drop in UK jobless numbers for 18 months.

Dow Jones futures are currently showing little difference to yesterday’s close as the market awaits the latest batch of US quarterlies, which includes Goldman Sachs and Google.

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 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 Philip Gillett, Sales Trader, IG Index.

After yesterday’s spike, it’s been a rough early morning’s trading for the FTSE 100.

The biggest losers so far include Imperial Tobacco, down -3.49% after trading ex-dividend today, and miners, who have been hurt by a predicted fall in demand after Chinese efforts to cut back on lending.

Xstrata, Kazakhmys, Lonmin, ENRC, Rio Tinto and BHP Billiton have all suffered this morning, losing between -2.7% and -2%.

Pharmaceuticals helped offset mining weakness, however, after news from the US that a Republican win in the Massachusetts Senate race might be key in preventing proposed healthcare reforms.

Shire was the biggest winner in early trading, up 25p (+2.03%) to 1,254.00, with GlaxoSmithKline (+1.21%) and AstraZeneca (+0.57%) not far behind.

While yesterday’s takeover of Cadbury by US food giant Kraft is still making waves in the media, the market seems to be holding off in case of further developments.

The confectioner’s stock is yet to show any significant movement.

A statement last night from Cadbury Chairman Roger Carr that job cuts would be an ‘inevitability’, however, might have investors on edge.

Similarly, concerns regarding Kraft’s borrowing to finance the deal could filter down to Cadbury once the US markets open.

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 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 Philip Gillett, Sales Trader, IG Index.

In mid-morning trading, UK blue chips are under some considerable pressure with the FTSE back to levels seen on the first trading day of 2010.

The revised Kraft bid for Cadbury has been making most of the morning’s headlines, with the board of Cadbury recommending the revised offer should be accepted by shareholders.

However, the broader market seems more concerned with UK inflation data coming in higher than expected, increasing expectations that a rise in interest rates will need to be made by the year end.

After yesterday’s broad base strength a degree of caution has returned to stock markets today and the move by the FTSE back below 5450 suggests that in the short-term we may well see more pressure on share prices.

Looking ahead to the US, we are expecting little change for the Dow Jones when it opens this afternoon.

Ahead of that, Citigroup’s quarterly earnings are due out. Based on the cool reaction to the JP Morgan numbers last week and the way London trading has started today we could end up seeing the US markets start under some pressure.

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 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 Anthony Grech, Market Strategist, IG Index.

Despite a quiet start to the week’s trade, the FTSE 100 is currently sitting around 40 points higher.

The US markets are closed for the Martin Luther King holiday.

In addition, there is limited earnings news around to offer traders any meaningful direction so it’s been a rather lacklustre session so far.

The mining sector has, however, offered some support in London with Gold prices nudging higher once again.

This is doubtless helped along by factors including uncertainty over the outlook for the Euro as finance ministers convene to discuss Greece. The banks are also rallying after the sell-off we saw at the end of last week.

The Cadbury takeover took another turn today with news that Kraft would up its bid ahead of tomorrow’s Takeover Panel deadline.

There is also speculation that International Power may too find itself as a bid target and this has pushed the stock to the top of the leader board, currently up almost 7%.

As equity prices continue to move higher the opportunities to make smart acquisitions could become more limited which may result in a flurry of M&A activity in the coming months.

Whether this will be sufficient to see wider markets ride out any correction remains to be seen and with some high profile macroeconomic data due in the next week the risks still remain on the downside.

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 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.