Posts from — February 2010

Financial Market Comments from Tim Hughes, Head of Sales Trading, IG Index.

In mid-morning trading in London the UK’s blue-chip index has risen slightly.

It has been a volatile start to the session today, with shares recovering from an initially negative opening.

Traders are busy digesting the ramifications of last night’s announcement by the US Federal Reserve. This revealed a raising of the discount rate for the first time in three and a half years.

So far the stock market seems to have ridden this news well, with the main casualty being the Pound, which has slipped to a nine month low against the US Dollar.

Closer to home, UK retail sales fell more than expected in January as the arctic conditions confined shoppers to their homes.

The impact on quoted retailers has been minimal though as the sector has been under pressure since the beginning of the year.

The latest statements from the likes of Marks & Spencer and Next have all been cautious about the outlook for 2010 and share prices have suffered since.

Looking ahead to the US open we are expecting the Dow Jones to start the day around 60 points lower than last night’s finish.

The Fed announcement being the catalyst for a sharp sell-off just after Thursday’s close.

But stock markets have proved resilient in recent weeks so it would not be surprising if these losses were erased as the day goes on.

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 David Jones, Chief Market Strategist, IG Index.

In mid-morning trading the FTSE 100 index is up on the day after a choppy session so far.

Shares got off to a lacklustre start today with blue chips initially wallowing slightly down from Wednesday’s close.

However, news at 9.30 showed that UK government spending exceeded revenue last month. This is the first time there has been a deficit in January since records begin in 1993.

January is traditionally a good month for government revenue, as we all eagerly pay any excess tax due for the previous tax year.

It would appear that the recession has taken its toll here with receipts down 11% compared to the previous year.

Markets have taken some cheer from this announcement, seemingly taking the view that this means an interest rate rise has been pushed further back as the economy and financial health of the UK still needing some nurturing.

Barclays are yet again a stand-out performer amongst the blue chips. However, it is BAE Systems that has claimed the top spot so far today, on the back of impressive results.

All of this has pushed the FTSE index back to levels not seen since January, helping to fuel the feeling that we are back in bull mode for shares.

Looking ahead to the US open, at the moment we are expecting the Dow Jones index to start off broadly unchanged.

Traders will be watching to see whether 10,300 levels can be sustained this afternoon.

In recent weeks rallies up to here have proved to be short-lived, so a positive finish for US stocks today can only add to the more upbeat outlook amongst investors at the moment.

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 Tim Hughes, Head of Sales Trading, IG Index.

At mid-morning, the FTSE is extending its recent run of positive form after posting its biggest rise for six weeks yesterday.

Man Group, the hedge fund business, is leading the pack after speculation that BlackRock is to launch a bid for the firm.

Miners are going well too, with Kazakhmys, Fresnillo and Rio Tinto leading the way for the sector as metal prices remain firm.

But in a tale of two commodities, BP finds itself languishing down at the wrong end of the FTSE 100 today as it went ex-dividend.

On the macro-economic front, UK unemployment figures for the three months to December are down 3000 from the previous quarter to 2.46 million.

However, the amount of people claiming Jobseeker’s Allowance has risen.

Meanwhile, according to the latest minutes released today, the MPC’s decision to end the QE programme was unanimous.

Barclays and Lloyds are also at the fore with both clearly basking in the warm afterglow of the former’s latest results.

In addition, the strong results posted by French bank BNP Paribas today has created a sense that Europe’s financial framework has taken another important step toward recalibrating.

Global investors have also noted with enthusiasm that European Union leaders had moved swiftly to re-assure all onlookers that it will definitely look after its own in times of need.

It definitely feels like a couple of dark clouds have moved on, and investors are certainly hungry for risk again.

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 David Jones, Chief Market Strategist, IG Index.

In mid-morning trading, an eventful day so far has seen the FTSE sharply higher and back above the 5200 level.

The big corporate news has been Barclays’ full year results, with profits coming in within the range expected at £11.6 billion.

Despite being the biggest blue chip riser yesterday, Barclays started trading this morning sharply higher again with gains in excess of 10% on the open.

Some of these have been chipped away since then but the bank still tops the leader board for the day so far with RBS and Lloyds close behind.

After the sharp move higher early on, there does seem to be an element of ‘buy the rumour, sell the news’ creeping in among traders. We are seeing many happy to unwind their positions in the face of the windfall profits of the last couple of days.

Inflation was the next event and in January this hit 3.5%, the highest level in more than a year.

Higher inflation numbers had been well telegraphed in recent weeks so this has caused barely a ripple for stocks or Sterling. However, expectations are that the January data is something of a freak number that will cool off in the months ahead.

Today’s strength by share prices has added to the recovery that started last week and adds further weight to hopes that the worst of the slides for the month are behind us.

A run back to the January highs for the FTSE at 5600 now seems like a reasonable medium-term target.

US markets were closed on Monday but at the moment we are expecting the Dow Jones to open around 80 points higher than Friday’s close.

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 Analyst, IG Index.

In mid-morning trading, UK blue-chips have started off the week positively.

The first couple of hours of trading have seen a calm start by markets following the volatility experienced last week.

So far British Airways is the biggest gainer, up by just over 4% after recovering approval for its tie up with American Airlines.

The rest of the top slots on the FTSE are shared, as usual, between miners and financials.

British Telecom is currently the biggest loser, still feeling the fallout after last week’s pension deficit news.

With US markets closed for President’s Day we may have already seen the biggest moves out of European stock markets.

There is always the potential for the Greece situation to add in a little bit of short-term volatility. However, for now it would not be a surprise to see sideways trading from the major indices for the rest of the session.

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.