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| Yesterday’s UK 100 Leaders | Close (p) | Chg (p) | % Chg | % YTD |
| Kingfisher | 276.9 | 6.7 | 2.5 | -18.0 |
| Ocado | 1079.5 | 20.5 | 1.9 | 171.9 |
| Sage | 629.2 | 10 | 1.6 | -21.2 |
| Morrison | 268.05 | 4.3 | 1.6 | 21.9 |
| Evraz | 486.1 | 6.4 | 1.3 | 43.0 |
| Yesterday’s UK 100 Laggards | Close (p) | Chg (p) | % Chg | % YTD |
| British American Tobacco | 4122.5 | -100 | -2.4 | -17.9 |
| Imperial Brands | 2923.5 | -63 | -2.1 | -7.7 |
| BHP Billiton | 1610.6 | -34.6 | -2.1 | 5.8 |
| Hargreaves Lansdown | 2160 | -41 | -1.9 | 19.9 |
| Compass | 1681.5 | -27 | -1.6 | 5.1 |
| Major World Indices | Mid/Close | Chg | % Chg | % YTD |
| UK UK 100 | 7,565.7 | -25.6 | -0.34 | -1.6 |
| UK | 20,643.0 | 111.8 | 0.54 | -0.4 |
| FR CAC 40 | 5,408.6 | 29.0 | 0.54 | 1.8 |
| DE DAX 30 | 12,384.5 | 53.2 | 0.43 | -4.1 |
| US DJ Industrial Average 30 | 25,822.3 | 63.5 | 0.25 | 4.5 |
| US Nasdaq Composite | 7,859.2 | 38.2 | 0.49 | 13.9 |
| US S&P 500 | 2,863.0 | 5.9 | 0.21 | 7.1 |
| JP Nikkei 225 | 22,344.1 | 124.4 | 0.56 | -1.8 |
| HK Hang Seng Index 50 | 27,852.5 | 99.7 | 0.36 | -6.9 |
| AU S&P/ASX 200 | 6,261.1 | -23.3 | -0.37 | 3.2 |
| Commodities & FX | Mid/Close | Chg | % Chg | % YTD |
| Crude Oil, West Texas Int. ($/barrel) | 66.17 | 0.16 | 0.23 | 10.1 |
| Crude Oil, Brent ($/barrel) | 72.92 | 0.44 | 0.6 | 9.4 |
| Gold ($/oz) | 1195.48 | 6.38 | 0.54 | -8.3 |
| Silver ($/oz) | 14.73 | 0.04 | 0.24 | -12.7 |
| GBP/USD – US$ per £ | 1.2913 | – | 0.07 | -4.4 |
| EUR/USD – US$ per € | 1.1579 | – | 0.02 | -3.5 |
| GBP/EUR – € per £ | 1.1154 | – | 0.05 | -0.9 |
Click graph to enlarge
UK 100 Index called to open -30pts at 7535, extending the 3-week downtrend, though coming off overnight 7517 lows. Bulls need a break above 7564 Tuesday’s close to attempt an escape from the downward momentum. Bears require a re-test of 7517 overnight lows to challenge August’s 7475 support level. Watch levels: Bullish 7575, Bearish 7514
Calls for a negative open are in spite of very bullish market sentiment in the United States, where S&P 500 renewed record highs and is poised to extend the longest ever Wall St bull rally. Despite the positive lead from Wall St, Asian bourses are more mixed, with markets wary of geopolitical shake-ups in the aftermath of Donald Trump’s ex-lawyer Michael Cohen pleading guilty to campaign finance violations and indirectly implicating his former boss.
USD is weaker this morning, with Sterling gains pressuring UK Index , after a news of potential breakthrough in US-Mexico tariff negotiations over NAFTA free trade zone. Oil prices are higher this morning after an unexpectedly large 5.17m barrel draw in private API crude oil stocks overnight. This comes in advance of official government EIA report later today and could support UK Index ’s oil sector among overall market negativity.
In corporate news this morning Intertek appointed Ross McCluskey, company’s current financial controller, as the group CFO with immediate effect. Capita appoints Patrick Butcher (current Go-Ahead CFO) as the new Chief Financial Officer, with the new finance chief expected to join the company by the end of the year. Rachel Osborne joins Debenhams as the new CFO, moving over from Domino’s Pizza.
Building materials distributor Grafton H1 like-for-like revenue +8% YoY, adj. op. profit +17%, pre-tax profit +19%, dividend +17%, net debt +26.8%. UK merchanting market conditions are projected flat for the rest of the year, while house building market is expected to remain strong. FY guidance reiterated.
Avast reports good H1 performance after IPO, with FY guidance reiterated. Adj. billings +4% YoY, adj. EBITDA +10%, margin +258bps. Plans to pay dividend in H1 2019, at 40% of free cash flow.
Diploma announces acquisition of FS Cables electrical, data & communications cable company based in St Albans for £17m. Elementis reached agreement to sell its former colourants site in Jersey City for $17m.
In focus today will be macroeconomic data from across the Atlantic, with US Existing Home Sales (3pm) expected to have grown 0.4% in July, recovering after a 0.6% fall in June. Crude oil and gasoline inventories from the US Department of Energy (3:30pm) are forecast to decrease by 1-2m barrels after a surprise 6.8m barrel build last week.
In the evening, focus shifts to the release of Fed’s FOMC 1 August meeting minutes (7pm). While the meeting itself produced no change in interest rates, there was no press conference from Fed Chair Powell either. Because of this, the meeting’s written account will give the markets a “sense of the Fed”, an up-to-date reading of central bankers’ latest thinking with regards to monetary policy normalisation.
With three more FOMC meetings scheduled for the rest of the year (two of which featuring an attached press conference), will we see more rate hikes in spite of Donald Trump’s allergic reaction to monetary tightening? Watch USD for reaction.
A few more US companies are reporting results this afternoon, including retailers Target and Lowe’s.
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Prepared by Michael van Dulken, Head of Research