FTSE higher on mixed corporate news, higher WTI prices
Fiona Cincotta April 29, 2020 10:20 AM
Mixed corporate news, a gradual reopening of more US states and countries across Europe and a 14% jump in WTI prices helped the FTSE open higher Wednesday.
Mixed corporate news, a gradual reopening of more US states and countries across Europe and a 14% jump in WTI prices helped the FTSE open higher Wednesday. The day ahead will be one of the busiest for the US reporting season with Facebook, Tesla and Boeing all turning in their numbers.
Volatile trading helps offset bank loan losses
Following in the steps of other major European banks Barclays has announced a sharp increase in provisions for bad loans as it braces for a slew of retail and corporate defaults. Worryingly, first-quarter credit impairment charges rocketed up to £2.1bn, far above the £920m pegged by analysts. However, the bank still reported a profit of £605m as a massive increase in its trading revenue made up for some of the corona-induced losses.
A move by British Airways parent IAG showed a major weakness in the government-planned support scheme for businesses. Though there is significant cash available to help businesses hit by coronavirus to keep staff in the short term, the government may not be able to continue financing those firms for as long as it will take for them to recover. IAG is about to cut 12,000 jobs, after it already furloughed 22,000 staff earlier in April, arguing that the industry will take years rather than months to recover. Shares in IAG dropped 3.6% Wednesday bringing the total decline for this year to 65%.
WTI shoots up, Brent crude notches slightly higher
In what looks like a speculative move ahead of the release of the US stock data later Wednesday, WTI prices shot up over 14% to nearly $14/bbl overnight. Investors’ mood has been boosted by the much faster lifting of the lockdowns across the US states which was initially expected to take at least another two weeks rather than days after the White House published its guidelines for reopening. Brent crude is also notching higher but at a far less dramatic pace, although a similar process is taking place across Europe.
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.