Market Brief: Risk ON
- Ahead of the open on Wall Street, it has been a risk-on day with stocks and commodity dollars rising, and yen falling. The AUD was the strongest and EUR the weakest ahead of the ECB rate decision on Thursday.
- USD shrugged off Trump’s latest criticism of the Fed, after he labelled the central bank policymakers as ‘boneheads’ and called for zero interest rates or lower. US headline (0.1%m/m) and core PPI (0.3%) both came in ahead of expectations. CPI is due tomorrow.
- GBP stalled after recent sharp gains, allowing the FTSE to shine.
- US crude oil Inventories due at 15:30 BST – the data is expected to reveal oil stocks declined by 2.7 million barrels last week following a 4.8 million drawdown the week before.
Corporate news courtesy of colleague Ken Odeluga:
- Hong Kong stock exchange group has made a £32bn bid for LSE owner London Stock Exchange Group. It's worth £20.45 per shares plus 2.495 new HKEX shares for every LSEG share, or £83.61/share all in. The UK company traded at £72.50 early in the afternoon, up 6%. A shortfall between an offer price and market price typically suggests investors don't currently expect a deal to be done. LSEG said it "remains committed to and continues to make good progress on its proposed acquisition of Refinitiv Holdings (formerly Thomson Reuters' data division).”
- UK construction equipment leasing firm Ashtead was another European stock market standout, rising as much as 4%, the most since June, after an initial volatile reaction on Tuesday following quarterly results.
- World High Life will be the first Cannabis stock to list in London. The investment company will set its market value at £11m, with a view to capitalising further from its focus on the European and Canadian medicinal pot markets.
- U.S. pre-market action incudes a 3% rise by troubled retailer J.C. Penny above its consensus price target for the first time in 11 weeks. With little company specific news, JCP's rise may be related to Tuesday's sharp rotation into 'value' stocks. Early Wednesday indications suggest that the move to favour cheaper, higher-yielding shares over long-standing 'momentum' outperformers, may already be fizzling out just a day later.
- Among bigger movers, GE-owned oil rig group Baker Hughes looks set to drop when Wall Street opened after warning that its third quarter could be hit by geopolitics and toughening industry trends
Disclaimer: The information on this web site is not targeted at the general public of any particular country. It is not intended for distribution to residents in any country where such distribution or use would contravene any local law or regulatory requirement. The information and opinions in this report are for general information use only and are not intended as an offer or solicitation with respect to the purchase or sale of any currency or CFD contract. All opinions and information contained in this report are subject to change without notice. This report has been prepared without regard to the specific investment objectives, financial situation and needs of any particular recipient. Any references to historical price movements or levels is informational based on our analysis and we do not represent or warranty that any such movements or levels are likely to reoccur in the future. While the information contained herein was obtained from sources believed to be reliable, author does not guarantee its accuracy or completeness, nor does author assume any liability for any direct, indirect or consequential loss that may result from the reliance by any person upon any such information or opinions.
Futures, Options on Futures, Foreign Exchange and other leveraged products involves significant risk of loss and is not suitable for all investors. Losses can exceed your deposits. Increasing leverage increases risk. Spot Gold and Silver contracts are not subject to regulation under the U.S. Commodity Exchange Act. Contracts for Difference (CFDs) are not available for US residents. Before deciding to trade forex and commodity futures, you should carefully consider your financial objectives, level of experience and risk appetite. Any opinions, news, research, analyses, prices or other information contained herein is intended as general information about the subject matter covered and is provided with the understanding that we do not provide any investment, legal, or tax advice. You should consult with appropriate counsel or other advisors on all investment, legal, or tax matters. References to Forex.com or GAIN Capital refer to GAIN Capital Holdings Inc. and its subsidiaries. Please read Characteristics and Risks of Standardized Options.