Reflect & Prepare

Friday, 8th November 2019 15:18 - by Reflect & Prepare

The focus in the US has been all on the US-China trade talks, with both sides working hard to get to the stage where they can sign Phase One of a trade deal.  However, China is insisting on the removal of tariffs from the US, though Washington has agreed to roll back some of these levies as it tries to compromise on getting to an agreement.  However, it seems to be a chicken and egg situation with China insisting on more cuts while the US wants to see more concessions from China.  The to and fro of commentary continues to prompt some modest volatility at best, but as we have seen from the new record highs, the optimism of a deal is riding high and prospects for improving global growth have also heightened a little.  

This will also be served by a Federal Reserve which has been providing fresh accommodation through rate cuts to the tune of 75bps this year, but as some of the data has shown more recently - ISM non manufacturing PMIs for instance - the slowdown is perhaps not as bad as some fear, so we may enter a period where the FOMC decide current levels of policy remain adequate.  

With the UK gripped by fresh election fever, there is little else to focus on other than the odds of the various parties claiming power and the poisoned chalice that Brexit has become.  The Tories remain in the lead in the polls, with the Labour party still coming under fire from a number of quarters as Jeremy Corbyn's leadership is persistently being questioned.  Until the election is done and dusted, markets here will remain in limbo, as the exit from the EU remains the number one issue in the UK.  

The Bank of England also met this week, and what was expected to be a formality in keeping rates unchanged, turned into a familiar development as some policymakers dissented with the consensus and voted for a rate cut.  Given the degree of negative impact the delay and uncertainty that the Brexit process has had on UK business, members Saunders and Haskel voted for a rate cut of 25bps, citing the global slowdown as another reason to offer some relief to the economy through lower interest rates.  All this has really done is to shift the central bank sentiment more towards market thinking.  Calls through the year for modest tightening have had little backing from the rate markets.

Movers and Losers

Tobacco names have moved higher once again after the vaping ban in the US. Imperial Branks have pushed up 3.5% from the recent lows seen last week.

Wood Group +10%: The Co. reported that their earnings outlook remains 'broadly' in line with consensus, this comes despite a slowing macro environment.

Ocado -10%: It was reported that a director made a £10million sale of shares and the M&S deal could be on the rocks.

Week Ahead

Monday - UK GDP, UK business investment

Trading Statement

Dignity PLC [DTY]

Informa PLC [INF]

William Hill PLC [WMH]

AGM / EGM

Salt Lake Potash Limited [SO4]

Final Result

Carrs Group Plc [CARR]

Interim Result

Kainos Group Plc [KNOS]

Tuesday - UK earnings data, German ZEW, Oil API's

Interim Result

Arrow Global Group [ARW]

Land Securities Group Plc [LAND]

Picton Property Income Ltd [PCTN]

Premier Foods PLC [PFD]

Vodafone Group PLC [VOD]

Trading Statement

Electrocomponents PLC [ECM]

ITV PLC [ITV]

Meggitt PLC [MGGT]

AGM / EGM

Craneware PLC [CRW]

Pacific Horizon Investment Trust Plc [PHI]

Wednesday - RBNZ rate decision, UK, US & German CPI, Fed's Powell testifies, Japanese GDP, DoE's

Interim Result

British Land Co PLC [BLND]

Gamesys Group Plc [GYS]

Valeura Energy [VLU]

Wizz Air Holdings Plc [WIZZ]

Final Result

Avon Rubber PLC [AVON]

Trading Statement

Coca-Cola HBC [CCH]

Wetherspoon (J D) PLC [JDW]

Tullow Oil PLC [TLW]

Taylor Wimpey PLC [TW.]

Thursday - AUD employment data, Chinese industrial production, German GDP, UK retail sales, EU GDP, US PPI

Interim Result

Burberry Group PLC [BRBY]

Great Portland Estates PLC [GPOR]

Mediclinic International Plc [MDC]

NextEnergy Solar Fund Ltd [NESF]

National Grid PLC [NG.]

Picton Property Income Ltd [PCTN]

S.N.G.N. Romgaz S.A. [SNGR]

TBC Bank Group Plc [TBCG]

Telecom Egypt [TEEG]

Trading Statement

Premier Oil PLC [PMO]

Safestore Holdings PLC [SAFE]

Final Result

Tracsis PLC [TRCS]

Friday - EU CPI, US retail sales, US industrial production

AGM / EGM

Adamas Finance Asia Ltd [ADAM]

Berkeley Energia Ltd [BKY]

Final Result

Future PLC [FUTR]

Interim Result

Grupo Clarin [GCLA]

Have a great weekend!

Kind Regards

Rajan Dhall

The Writer's views are their own, not a representation of London South East's. No advice is inferred or given. If you require financial advice, please seek an Independent Financial Adviser.