Barclays Gains as Pre-Tax Profit Rises 26%
With Barclays announcing pleasing figures, the UK banking sector is doing its best to drag the FTSE 100 higher and, at 10am, the index is up two points at 6279.
With ground to make up from a long weekend, the overnight Asian markets were very positive until news that North Korea has carried out more nuclear testing slightly derailed sentiment.
This morning’s UK retail, consumer and producer price indices confirmed that the continuing weakness of sterling and the rise in Brent crude to $118 has increased inflationary pressure on the average man on the street.
Traders will be interested to hear what ECB President Mario Draghi has to say this afternoon, following two days of discussions with Eurozone finance ministers.
It is suspected that the precarious state of the Spanish government and the knock-on increase in sovereign debt borrowing costs will have been high up the agenda.
Barclays continues to transform under the guidance of new CEO Anthony Jenkins; full-year pre-tax profit looks likely to break the Â£7 billion level, up 26%.
Cost-cutting measures are also being brought in and, unsurprisingly, it is staff numbers that will bear the brunt of the pain, with 1800 staff from the investment arm losing their jobs. It seems that the vast majority will be overseas employees.
G4 Securities have announced a loss of Â£38 million; when you factor in the Â£88 million cost of the Olympic fiasco, this is not too surprising.
Looking ahead to the US open, at 10am (London time) the Dow is being called to open down 24 at 13,947.
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Financial Market Comments from Alastair McCaig, Market Analyst, IG Index.
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