Posts from — July 2010

Financial Market Comments from Anthony Grech, Head of Research, IG Index.

The FTSE hasn’t really got out of bed this morning, dropping about 18 points to around the 5295 level.

It’s been a cautious start for the FTSE 100 today as investors wait for the US Commerce Department’s advance report on GDP this afternoon.

A Bloomberg survey has forecast an annual growth rate of 2.6% for the second quarter, which would be down on the 2.7% pace generated in the first quarter.

The decline is expected to be attributed to increased imports and declining consumer spending and follows weak data on durable-goods orders and consumer confidence during the week.

However, London’s blue chips still managed to find time to decline around 18 points in early trading, as Dublin-based biopharmaceuticals company, Shire, dropped 2.75% after an analyst downgrade.

British Airways revealed a pre-tax loss of £164 million for the three months from April to June. This is larger than the £148 million loss the airline recorded for the same period last year. Despite this, there was enough that was positive about BA’s report that shares were in fact up 2.45% at 10am in London.

Samsung Electronics unveiled record quarterly net profits of £2.3 billion, an 83% rise on the same period in 2009.

But all eyes will be on Washington today to see just what sort of a statement the Commerce Department will make about the economic recovery in the US.

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, shares in London have bounced back and reclaimed some of the ground lost yesterday.

Pleasing numbers from some blue-chip heavyweights has lifted sentiment this morning.

Telecoms business BT Group has seen profits rise in the first quarter thanks to cost cutting measures and pharma AstraZeneca has beaten expectations for second quarter profits and raised its forecast for the next one.

This has meant a strong start to the day for both shares which is helping to inspire a broad based rally across a mix of sectors.

There had been concerns that sentiment towards UK shares was on the turn in recent days, following the 10% plus rise for the index this month.

While the jury is still out on how much upside there is left from current levels, today’s positive earnings – and a further drop in German unemployment has helped inject a little enthusiasm back into trading.

Looking ahead to the US, we are expecting the Dow to start off around 40 points higher than last night’s close.

The 10,600 highs from June still remain the big hurdle for this index and with traders awaiting Friday’s release of the latest GDP numbers, we could be in for a day of treading water with no real direction.

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.

Early trading on the FTSE hasn’t had much of an impact so far, with the UK index holding steady after last night’s trend-breaking dip.

The burst of confidence in the financial sector provoked by the European stress tests is continuing to buoy British bankers, with Lloyds, Barclays and RBS extending their positive run this morning.

In addition, the proposed financial reforms out of Basel, which had the markets flinching in anticipation, appear to be leaning more towards silk than sandpaper – a turn of events which has has poured soothing balm on bankers’ fears.

This morning’s other champions are once again the mining companies, as positive performance out of the Asian markets overnight lent commodities demand the usual upward swing.

Last night’s poor data out of the US, which led to the FTSE 100‘s late slump, will no doubt have analysts on edge; and the twitchier bears could easily look at that dip as an opportunity to make the most of the month’s steady rise and seize profits before any potential backsliding kicks in.

Among those companies reporting today there are signs the exodus might already have begun, with engineering group Invensys seeing share prices fall 5.5% despite announcing improved expectations for the year off the back of a respectable Q1 performance.

British Gas owner Centrica saw a similar lack of confidence hit its share prices, even in the face of a six-month profit increase of 65%.

With no major economic data due out of the UK today, it’s worth watching the corporate reports and subsequent share movements to see whether the bears are strapping themselves into the FTSE’s ejector seat.

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.

In mid-morning trading the FTSE 100 has made a strong start, pushing out to its best levels in more than two months.

After a modestly positive start to the week on Monday, investors seem freshly emboldened this morning following a good performance on Wall Street, good banking results and a positive reaction to BP’s quarterly numbers.

Today’s statement from the oil giant held little to worry markets, and with the change of chief exec many will be hoping this marks a clean slate for BP – one which could result in more shareholder value being recovered over the months to come.

The top blue chip gainers today are dominated by the banks, getting a little bit of the feel-good factor following better-than-expected earnings from Deutsche Bank.

All of this has meant that after losing some momentum in recent days, the market looks to have found a fresh pair of legs and the rally could still have further to run.

Looking ahead to the US, at the moment we are expecting the Dow to start off this afternoon around 10 points higher.

In recent weeks the 10,600 area has been a real barrier for the Wall St index so this, combined with consumer confidence data and another slew of earnings, could make for a volatile session ahead.

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 Anthony Grech, Head of Research, IG Index.

Mid-morning and the FTSE has seen the bulk of its early gains ebb away.

Friday’s European bank stress tests received something of an endorsement from the markets with traders reassured by the fact that there were some failures amongst the weaker institutions, as predicted, and this has been played out with London’s listed banks rallying in early trade.

BP has also found support off the news that the drilling of the relief well in the Gulf of Mexico can resume whilst Tony Hayward’s seemingly imminent departure also appears to be cheering the company along.

However, even with these heavyweight elements trading higher the FTSE is struggling to hold onto positive territory. With the summer holiday season now well and truly upon us, this lack of direction is probably something markets will need to grow used to in the coming weeks.

There’s not much due out in the US this afternoon although with speculation of a double dip building, forecasts over the GDP numbers due on Friday are continually being revised lower, the new home sales data expected today will be closely watched.

The earnings season has generally been robust and this is expected to continue in the week ahead but with equities in general running the risk of looking a little toppy once again, the risks remain stacked on the downside.

Anything that proves unsettling, especially in times of quieter volume, could be the next trigger for a sell-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.