Markets Round-Up on 20th October 2017.

Stock Markets

In the US last night, after initially coming under pressure, stocks regained ground. The major averages climbed well off their worst levels, with the Dow and the S&P 500 turning positive late in the day to reach new record closing highs. The tech-heavy Nasdaq bounced well off its lows of the session but still closed down 19.15 points or 0.3% at 6,605.07. The Dow inched up 5.44 points or less than a tenth of a % to 23,163.04, and the S&P 500 crept up 0.84 points or less than a tenth of a % to 2,562.10. The early weakness on Wall Street was partly due to profit taking after the major averages, with a negative reaction to some of the latest earnings news inspiring traders to cash in on the recent strength in the markets.

Asian markets are mostly higher, with some of the markets recovering from losses earlier in the session. Japanese stocks were flat but Chinese stocks were up,  Hong Kong was up over 1%, Korean stocks were up 0.67% and Australia was up 0.2% with just Taiwan and India providing some drag.

It is interesting watching the Spanish/Catalan struggles and one can’t help but compare it with our recent Scottish independence debate. Catalonia, which now enjoys autonomous status, may have its priveleges revoked by Madrid if it keeps moving toward independece. This would likely trigger a formal declaration of independence. The IBEX appears to reflect the mood that things are about to get worse, however perversely it has risen today by 0.25% while most of the rest of Europe was flat.

Flat as a pancake – After a promising start to the week with hopes of a series of all-time highs London shares disappointed finishing flat at 7523.  Reckitt Benckiser was one of the biggest fallers, dropping by almost 3% after downgrades from SOCGEN, RBC and S&P GLOBAL pulled the giant consumer goods company to 12 month lows.  In other news, Acacia Mining gave up yesterday’s gains falling 17% after today confirming its Q3 results were adversely effected by the Tanzanian Governments export ban – Investors still await further news of Barrick Golds unusual intervention to hurdle the ban imposed by Tanzania on Acacia Mining.


The pound fell against the dollar yesterday after a drop in retail sales. The pound  is  at €1.12 Euros, $1. 3195 US Dollars.


Oil prices rose, supported by signs of tightening supply and demand fundamentals, although a warning about excessive China economic optimism still weighed somewhat on markets. WTI is at 51.29 and Brent at 57.24.

Gold futures were higher Thursday amid mixed US economic data and political turmoil in Spain.  It then turned lower after the U.S. Senate approved a budget blueprint for the 2018 fiscal year that will pave the way for Republicans to pursue a tax-cut package without Democratic support with Gold closing at 1280.8 today.


The UK budget deficit narrowed in September, the Office for National Statistics said Friday. Public sector net borrowing, excluding public sector banks, decreased by £0.7bn from the previous year to £5.9bn in September. This was the lowest September net borrowing since 2007. During April to September period, PSNB decreased by £2.5bn to £32.5bn, which was the lowest year-to-date net borrowing since 2007.

Interserve, the international support services and construction group, has won a five-year contract worth £227m to provide facilities management services for the Department for Work and Pensions (DWP). Interserve will provide the DWP estate with mechanical, electrical and building maintenance. The company will also provide cleaning, catering, waste disposal, removal and secure destruction of confidential waste services to over 700 buildings throughout the UK, covering over 1.3 million square metres of space. This will be a much need fillip to the company that is struggling at present with profit warnings and advisors being called in.  See our blog about them earlier this week.

Theresa May has issued a direct plea to EU leaders to clear the way for a Brexit deal which she can sell to British voters. After coming under growing pressure from hardline Eurosceptics in her own party to prepare for a no-deal Brexit, the prime minister told leaders of the remaining 27 states at a Brussels summit that they face a “clear and urgent imperative” to give new impetus to stalled negotiations if they are to get an outcome which is acceptable to both the British public and their own people. The EU27 will declare on Friday that insufficient progress has been made in withdrawal negotiations for trade talks to begin as Britain wants, with several leaders making clear they want more “clarity” about how much the UK is willing to pay in its Brexit “divorce bill”.

Yesterday’s The Standard’s Seb talked to a range of experts about the future of London’s financial services sector post-Brexit. Despite fears over passporting rights and access to labour, many believe the capital can overcome the main challenges. PwC chairman Kevin Ellis comments: “Our clients are optimistic that they can thrive in the post-Brexit economy. But there are risks, with businesses most concerned about access to skilled labour and rising supply costs as a result of currency fluctuations, potential trade tariffs and quotas.” Deloitte’s Brexit lead David Noon says although there are risks, “the City has proven to be a resilient and adaptable beast. Many firms will remain in London.” He adds: “London is a hotbed of innovation… it will remain a global business centre outside the EU.” Regarding Britain’s future immigration regime, KPMG London partner Tim Sarson suggests businesses support their EU citizens to ensure they have the talent and skills they need to thrive in the post-Brexit economy.

Thursday Evening Standard, Page: 46, 48

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