Markets Round Up on 18th October 2017
Stock Markets
US markets finished the day positively yesterday, with the DOW closing just short of the 23,000 mark which it breached for the first time ever earlier in the session, amid a busy third quarter earnings season on Wall Street. The S&P 500 finished slightly up at 2559.36 while the NASDAQ was flat at 6623.66.
Stocks in Asia were steady as investors in the region looked to China’s Party Congress for signs on future policy direction in the world’s second-largest economy. The Chinese CSI 300 rose 0.8% this morning to 3944.16 while markets in Hong Kong, Japan, Korea and Australia were all flat, failing to move more than 0.1%.
UK Markets continued their recent uptrend today as both the Blue Chip and Mid Cap indexes approached all-time highs. The FTSE 100 was up 0.4% to 7542.9 and the 250 rose 0.6% to 20,259.8.
The best performers were mainly in the UK250 with several bombed out stocks showing significant gains – namely Spire Health up 9%, Foxtons 7.7% Greencore up 4.6% and Dixons up 4% – the mining sector took a breather today ahead of Chinese GDP figure due out tomorrow – with Rio Tinto down 3% and Anglo American down 2.2%. However of the 100, Pearson & ITV lead the leaders.
In Europe the Eurostoxx 50 climbed 0.33% to 3619.65 with the French, German and Spanish markets all rising similarly.
U.S. shares have opened higher as the US Treasury secretary Steve Mnuchin has warned that their continued rally is dependent on Congress enacting tax reforms. Investors are also looking to interpret an extended speech from Chinese President Xi Jinping in Beijing.
Currency
The pound is down slightly at €1.1192 Euros, $1. 3196 US Dollars.
Commodities
Lifted by a fall in U.S. crude inventories and concerns that tensions in the Middle East could disrupt supplies, oil prices prices rose to a three-week high today (Brent $58 and WTI $51.9).
Gold inched up from a one-week low to $1281.6 with the dollar holding steady but speculation that President Donald Trump might pick a policy hawk to lead the U.S. Federal Reserve weighed on the metal.
Other
The US Securities & Exchange Commission charged Rio Tinto and two former top executives with fraud for inflating the value of coal assets acquired for $3.7bn and sold a few years later for $50m. The SEC’s complaint, which was filed in federal court in Manhattan, alleged that Rio Tinto, its former chief executive officer, Thomas Albanese, and former chief financial officer, Guy Elliott, failed to follow accounting standards and company policies to accurately value and record its assets. Rio Tinto said it “intends to vigorously defend itself against these allegations”. The firm added in a statement it believes the “SEC case is unwarranted and that, when all the facts are considered by the court, or if necessary by a jury, the SEC’s claims will be rejected.”
Sainsbury’s has said it will cut up to 2,000 jobs from its human resources staff as part of plans to reduce costs. The UK’s second biggest supermarket chain says the “difficult decision” will affect roles in stores, as well as in the company’s central offices. It plans to make 1,400 payroll and HR clerks redundant and other changes could see another 600 posts removed. Sainsbury’s is looking to save £500m amid fierce competition from discounters and rising food costs. The majority of the headcount losses will be from within its supermarket stores.
The UK unemployment rate held steady at the lowest level since 1975 and the wage squeeze continued, data from the Office for National Statistics showed today. The number of unemployed decreased by 52,000 from March to May to 1.44 million.
Goldman Sachs has reported a fall in third-quarter profits following a further fall in bond trading revenue. However, the 26% drop in bond trading revenue was smaller than expected, following a slump of 40% in the second quarter. Goldman’s net income for the quarter fell by 3% from a year earlier to $2.04bn (£1.55bn). Rival Morgan Stanley posted a stronger-than-expected rise in profits. Net income rose 11% to $1.69bn in the third quarter, helped by record revenues in its wealth management division which offset the decline in trading activity.
Businesses need to know by the end of the year if there will be a period of transition after Britain leaves the European Union, the chief executive of the London Stock Exchange Group said today. Xavier Rolet said that if there was no certainty about the post-Brexit arrangements within the next few months firms would begin implementing contingency plans.
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