The dividend nail
Fiona Cincotta April 1, 2020 5:15 AM
Banking stocks are attracting by far the highest volume on the FTSE this morning after stopping or delaying their dividends.
Banking stocks are attracting by far the highest volume on the FTSE this morning, as they do most mornings, but today the volume is about 50% higher after banks decided to stop or delay dividend payments in order to preserve cash to handle the crisis. The volume in Lloyds shares has nearly doubled as the bank lost 6% in value, and Barclays, HSBC and Royal Bank of Scotland are following in short succession.
Barclays bank may be one to watch the most closely as the bank is already trading ex-dividend. It was due to pay out shareholders on Friday.
The merciless flow of negative coronavirus news is also eroding the rest of the FTSE 100-listed firms. Even supermarkets like Tesco are clocking significant losses now that the early panic buying has turned from a flood into a trickle.
Carnival’s bold bond plan lifts stock
The only stock still trading in the black is cruise operator Carnival after the company made a bold decision to raise $3bn in three year bonds in order to keep afloat. Although the US and the UK offer fairly substantial rescue packages to companies who have been hit as badly by the coronavirus as Carnival – the Diamond Princess was quarantined off the coast of Japan shortly after the outbreak of the virus in China – the cruise operator will fall through the administrative cracks as it is incorporated in Panama.
Brent drops on supply data
Now we have it in black and white. Saudi Arabia’s promise to pump more oil because of a disagreement with Russia over trying to control declining oil prices has materialised in March and the country together with other United Arab Emirates produced an additional 90,000 bbl of oil a day. With this additional production - which is also likely to be matched by Russia - it will be difficult for oil prices to move any higher from current levels while the coronavirus is in full swing.
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.