FTSE focus turns back to UK ahead of results
Fiona Cincotta January 28, 2020 10:04 AM
UK-centric stocks are leading the FTSE higher Tuesday, managing to counterbalance declines among metal firms and miners and companies with significant exposure to China.
UK-centric stocks are leading the FTSE higher Tuesday, managing to counterbalance declines among metal firms and miners and companies with significant exposure to China, where the outbreak of the coronavirus is intensifying. Shanghai has already extended its New Year holidays until 9 February and Mongolia has closed its vast border with the country.
In London investors are taking up positions ahead of Thursday which will be heavy with company earnings including Diageo, Royal Dutch Shell, Unilever and BT Group.
Spirits firm Diageo is expected to report fairly strong results Thursday but likely to show some erosion from US tariffs on single malt introduced in October. It will be interesting to see if the company addresses the coronavirus in its outlook for the next six months given that 20% of its sales are into Asia where its blended whiskies like Jonnie Walker are particularly popular.
US reporting season won’t be able to avoid addressing virus
The two best-performing technology stocks of last year Apple and Advanced Micro Devices are both due to report results later Tuesday and while the numbers are likely to be at record high levels the spectre of the coronavirus will also have to be addressed. Apple operates two facilities in the city of Wuhan, the epicentre of the outbreak and currently in lock down while another 69 of its facilities are located in Suzhou which has for the moment not been cut off, but has prolonged its New Year holiday for another week. AMD is not as directly affected as Apple but like any technology company will not be able to avoid China exposure.
Brent crude is also being whipsawed by the coronavirus, rising overnight only to crash back below $58 in early trading. It is trading up 0.89% this morning.
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.