UK Financial Spread Betting Markets Rise as Eurozone Leaders Agree Banking Deal
The regular trading review of the main UK, US and European markets, plus a quick look at the commodities and forex markets.
For today's report see Financial Trading Review.
Financial Trading Review - 02 July 2012
UK Trading Review
UK markets closed higher on Friday, as European leaders agreed to shore up the region’s banking system to reduce borrowing costs for Italy and Spain and contain the region’s debt crisis.
Banking sector stocks, Lloyds Banking Group, HSBC Holdings and Royal Bank of Scotland Group gained between 0.5% and 4.3%, as financial spread betting investors remained optimistic on an agreement by Eurozone leaders for banks in the region.
Barclays dropped 1.7%, amid continued worries about the extent of the problems it faces, despite having settled allegations of manipulating interbank lending rates.
BP, Royal Dutch Shell and BG Group gained between 1.0% and 3.1%, tracking a rise in crude oil prices.
Berkeley Group Holdings climbed 3.2%, after it reported a sharp surge in full-year profits.
Cairn Energy added 3.5%, after it raised $365 million selling a stake in Cairn India Limited. Miners, Vedanta Resources, Rio Tinto Group and Antofagasta rose between 3.6% and 4.7%, as base metal prices traded higher.
FTSE 100 rose 1.4% to settle at 5,571.2, while FTSE 250 gained 2.3% to close at 10,932.1.
European Trading Review
European markets rallied on Friday, after EU leaders announced a range of positive measures to recapitalize banks using the region's permanent bailout fund, without adding to government debt, easing concerns about Italy and Spain.
In shares spread betting, Deutsche Boerse climbed 4.8%, after JPMorgan upgraded the stock to “Overweight” from “Neutral”.
BNP Paribas, National Bank of Greece and Banco Santander, rallied between 6.9% and 12.9%, as investors cheered the Eurozone emergency action.
BMW surged 5.1%, after UBS upgraded the stock to “Buy” from “Neutral”, while Daimler soared 4.5%, after the company reached a MoU with Tokyo-based Nissan on the mutual supply of light-duty trucks in Japan.
FTSEurofirst 300 index rose 2.6% to 1,021.4. German DAX Xetra 30 soared 4.3% to 6,416.3. French CAC-40 closed 4.8% higher at 3,196.7.
US Trading Review
US markets rallied on Friday, as an agreement by the Eurozone leaders on measures to contain the region’s debt crisis and shore up struggling banks boosted market sentiment.
Constellation Brands jumped 24.4%, after the company bought the remaining 50.0% of Crown Imports. KB Home climbed 12.6%, as the company sold more houses at higher prices during its fiscal second quarter.
Bank of America Corp, Citigroup and American Express rose between 2.7% and 5.7%, amid improved risk appetite among investors.
Apple advanced 2.6%, after Pacific Crest raised its price target on the stock.
Exxon Mobil Corp and Chevron Corp added 3.0% and 2.0%, respectively, following a rise in crude oil prices.
Research in Motion plunged 19.9%, after posting a first quarter loss and delaying the next BlackBerry operating system.
DJIA gained 2.2% to end at 12,880.1. NASDAQ climbed 3.0% to settle at 2,935.1. S&P 500 rose 2.5% to close at 1,362.2.
Forex Trading Review
At 0400 BST today, the GBP is trading 0.1% lower against the USD at $1.5659, 0.2% higher against the EUR at €1.2406, and 0.3% lower against the JPY at ¥124.89.
The EUR is trading 0.3% lower against the USD at $1.2622.
The EUR is trading 0.4% lower against the JPY at ¥100.67.
The EUR is trading lower against most of its major peers, amid mounting speculation that the European Central Bank would lower the interest rates, ahead of reports that might show jobless rate climbed to a record and manufacturing activity contracted in the region.
The USD fell against the JPY following a stronger-than-expected Tankan survey data in Japan. Investors speculate Institute for Supply Management report would show US manufacturing activity slowed down in June.
On Friday, the EUR closed higher against the USD, as post EU summit announcements eased investors’ concerns about the European banking sector and spurred optimism that EU lawmakers would resolve the region’s sovereign-debt crisis.
The JPY closed lower against the USD, after the industrial output in Japan fell 3.1% in May and domestic Purchasing Managers' Index (PMI) for the manufacturing sector in Japan contracted in June.
The CAD finished higher against the USD, as demand for high-yielding assets increased, amid optimism that Europe would be able to resolve its debt crisis.
Commodities Trading Review
In Asia, crude oil for August delivery is trading 1.1% or $0.97 lower at $83.99 per barrel.
On Friday, crude oil for August delivery soared 9.4% or $7.27 to end at $84.96 per barrel.
This was due to improved prospects for energy-demand growth after EU leaders, at a summit, announced plans to use bailout funds to reduce the debt burden on Italy and Spain, easing concern the Eurozone crisis would worsen.
Crude oil also gained value, after business activity in the US unexpectedly expanded in June and ahead of the start of a European Union oil embargo on imports from Iran due to begin July 1.
Gold for immediate delivery is trading 0.3% lower today, at $1,592.05 per ounce.
Gold for August delivery rallied 3.5% or $53.80 to settle at $1,604.20 per ounce on Friday, as the dollar weakened against the euro, after EU policymakers agreed on measures to help resolve the ongoing debt crisis in the euro region.
Financial Trading News
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The above comments do not constitute investment advice and neither ETX Capital nor Clean Financial accept any responsibility for any use that may be made of them. Any prices or data are indicative and subject to change without notice; its accuracy is not guaranteed and should not be relied on.
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'UK Financial Spread Betting Markets Rise as Eurozone Leaders Agree Banking Deal' edited by ETX Capital, updated 02-Jul-12
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