Posts from — August 2012

The FTSE appeared to be holding steady at the open of morning trading, as the usual caution set in ahead of Ben Bernanke’s Jackson Hole speech at 3pm (London time) this afternoon.

Trading volumes are low before the economic forum where the Fed chairman and other leading financial figures, including the IMF’s Christine Lagarde, will lay out the next steps of their recovery plans.

Speculation over the possibility of further QE out of the US, and even China, has been one of the primary drivers of FTSE futures in recent weeks.

This afternoon’s speech from Chairman Bernanke will, one way or another, throw yet more fuel on the fire.

Recent economic data has been mixed for the US, coming in slightly better-than-expected overall and damping hopes for another round of stimulus.

Traders on the Dow Jones spread betting market certainly seemed to have reached a conclusion on Thursday night, with the US index closing over 100 points down.

Unless this afternoon’s speech features some fairly strong hints that QE is on the cards, that downtrend seems likely to continue when the US re-opens.

For the moment however, European markets are in a holding pattern.

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.

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

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.

The UK spread betting market has recovered somewhat from earlier weakness and the FTSE 100 is currently trading lower by just five points at 5737.

News flow this morning centres on Barclays, conveniently introducing their new CEO after the SFO starts investigating them for payments made during the ‘Qatari bailout’ of 2008.

Anthony Jenkins, the previous head of the retail arm, is the man tasked with one of the toughest jobs at the top in the UK.

Cleaning up the image of Barclays will take time, and the reaction from the outside is that this is the safest option without taking the flak for hiring another investment banker, or the unknown territory of hiring an outsider.

Barclays shares were lower in early trade by around 1%.

US markets meandered to a fractionally positive day yesterday on one of the lowest volume days of the year.

Despite plenty of positive data to entice investors, the focus remained on the Republican convention and Hurricane Isaac, before Jackson Hole gets under way tomorrow.

Today we have inflation data as the pick of the bunch, and Dow futures have pointed to a negative open after falls in Asia and an uninspiring start to European trade.

We are currently expecting the Dow Jones to open around 13,060, down 57 points.

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.

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

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.

In mid-morning trade the FTSE is undergoing a modest wobble, down around 25 points as fears about the Eurozone crisis linger.

For most of August little has been able to disturb the narrative of ECB action that is expected in September. However, this morning that theory is under threat as one of the largest Spanish regions makes a request for assistance from Madrid.

Catalonia, which has an economy similar in size to Portugal, has asked for €5 billion in aid, but will accept no further austerity measures.

The region’s difficult history with the central government notwithstanding, it does put Prime Minister Rajoy in an awkward position.

To allow one region to get away without additional requirements would set a dangerous precedent, and also bring the ire of Frankfurt and Berlin down upon his head.

The question now is whether other regions will soon also ask for help, and whether markets can retain their breezy confidence until next week’s ECB meeting.

A sharp drop in profits at China’s biggest steelmaker is also providing cause for concern this morning, reminding markets that the Chinese economy is continuing to slow down and prompting weakness across the mining sector.

US second-quarter GDP data is published this afternoon, as well as the Fed’s Beige Book survey of the American economy.

US markets finished slightly lower yesterday, and this is expected to resume today, with the S&P 500 starting 1.75 points down at 1406.

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.

Financial Market Comments from Chris Beauchamp, Market Analyst, IG Index.

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.

In mid-morning trading, the FTSE 100 is down ten points, as caution pervades ahead of a potentially big week for the Federal Reserve.

We’ve waited almost a whole month for the annual appearance of Ben Bernanke at the Jackson Hole conference, and there are only three days to go.

The mood in markets remains quiet as people continue to read the signs and as usual, you can find arguments on both sides as to whether the Fed will take action or whether it will stand fast for now.

As a result, moves are likely to remain fairly limited for the time being, especially with an ECB meeting looming in the following week.

An auction of Spanish bills went well this morning, with Madrid selling slightly more than the target amount, an indication of how the ECB’s promise to ‘do everything it takes’ to save the euro continues to support sentiment.

In corporate news, the main event is G4S, whose half-yearly report painted a mixed picture; profit was down but revenue was higher. The slight hiccup over the Olympic contract however, has not been included.

On the economic front, we have US Case-Shiller home prices, consumer confidence and the Richmond Fed index.

US index spread betting markets are expected to open in subdued style, with the Dow starting up three points and the S&P 500 inching up half a point.

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.

Financial Market Comments from Rupert Osborne, Futures Dealer, IG Index.

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.

Where to Spread Bet on Hewlett-Packard?

You can spread bet on Hewlett-Packard with any of the following companies:

• Financial Spreads
• IG Index
• Tradefair

Although note that you can also spread bet with other Spread Betting Companies.

Hewlett-Packard Spread Betting – More Details

For more information on trading Hewlett-Packard, also see Hewlett-Packard Spread Betting.

Spread Betting on Hewlett-Packard

Should an investor decide to invest in companies like Hewlett-Packard then one option is to spread bet on the Hewlett-Packard share price.

If an investor was to look at the FinancialSpreads spread betting site, as of Friday, they were showing the Hewlett-Packard Rolling Daily market at $17.61 – $17.64. This means you could spread trade on the Hewlett-Packard shares:

• Going higher than $17.64, or
• Going lower than $17.61

Whilst spread betting on S&P 500 equities you trade in £x per cent. As a result, if your stake was £4 per cent and the Hewlett-Packard shares move $0.05 then that would be a difference to your P&L of £20. £4 per cent x $0.05 = £20.

You are also able to invest in this market in Euros or Dollars, e.g. $x per cent.

Rolling Daily Shares Markets

You should note that this is a Rolling Daily Market which means that in contrast with futures markets, there is no closing date. If your trade is still open at the end of the trading day, it simply rolls over to the next session.

If your bet does roll over and you are speculating on the market to:

• Go up – then you will pay a small overnight financing fee, or
• Go down – then a small payment is usually credited to your account

For more information on Rolling Daily Markets, and a fully worked example, please see Rolling Daily Spread Betting.

Hewlett-Packard Rolling Daily – US Shares Spread Trading Example

So, if we think about the spread of $17.61 – $17.64 and assume:

• you have done your market research, and
• you think that the Hewlett-Packard share price will move higher than $17.64

then you could go long of the market at $17.64 and invest, for the sake of argument, £2 per cent.

So, you gain £2 for every cent that the Hewlett-Packard shares increase and go above $17.64. Nevertheless, you will lose £2 for every cent that the Hewlett-Packard market decreases below $17.64.

Thinking of this in a slightly different way, should you ‘Buy’ a spread bet then your profit/loss is calculated 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 your stake.

As a result, if after a few sessions the share price rose then you might want to close your trade and therefore guarantee your profits.

Therefore, if the shares spread betting market moved up then the spread might move to $18.26 – $18.29. To close your position you would sell at $18.26. Accordingly, with the same £2 stake you would make a profit of:

Your Profit / loss = (Closing Level – Opening Level) x stake
Your Profit / loss = ($18.26 – $17.64) x £2 per cent stake
Your Profit / loss = $0.62 x £2 per cent stake
Your Profit / loss = 62¢ x £2 per cent stake
Your Profit / loss = £124 profit

Speculating on equities, whether by spread betting or not, doesn’t always work out as you would have liked. In the above example, you had bet that the share price would go up. Nevertheless, the share price might go down.

If the Hewlett-Packard shares weakened, against your expectations, then you might choose to close your position in order to limit your losses.

Should the market fall back to $17.11 – $17.14 then this means you would settle/close your trade by selling at $17.11. If so, that would mean you would lose:

Your Profit / loss = (Closing Level – Opening Level) x stake
Your Profit / loss = ($17.11 – $17.64) x £2 per cent stake
Your Profit / loss = -$0.53 x £2 per cent stake
Your Profit / loss = -53¢ x £2 per cent stake
Your Profit / loss = -£106 loss

Note – Hewlett-Packard Rolling Daily spread betting price correct as of 24-Aug-12.

Spread Betting Account Offers

If you are looking to open a spread betting account then for the latest spread betting offers please see Spread Betting Offers.

For a more detailed look at the spread betting markets, spread sizes and account services offered by a range of spread betting companies also see Spread Betting Account.

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.