A daily look at the Markets from Joshua Raymond, Market Strategist, City Index.

Poor ADP employment figures sent ripples through equity markets in Europe today, causing the FTSE 100, DAX and CAC to lose ground and turn negative on the day.

ADP employment data showed that the private sector surprisingly lost 23,000 jobs in March, when a growth of 40,000 had been expected and this has caused a bit of a stir in today’s markets.

As soon as the ADP employment data came out, we saw a rush to sell equities which resulted in the FTSE, Dax and CAC all losing approximately 0.5%.

The reason why the markets have reacted so drastically to the ADP employment figures is that it sends out a clear warning message ahead of Fridays Non Farm Payrolls, which were expected to deliver a very positive reading.

Now many investors will have to re-evaluate what they had hoped for from the Non Farms data.

With European markets closed on Friday too, many traders are getting out of positions now in case we get a similar shock to today’s private sector employment figures, as this will inevitably play a strong hand in how European markets open next Tuesday after the long weekend.

Contracts for differences (“CFD”) trading and spread betting carries a high level of risk to your capital with the possibility of losing more than your initial investment and may not be suitable for all investors. Ensure you fully understand the risks involved and seek independent advice if necessary.

This material should not be construed in any circumstances as a recommendation or offer to sell or recommendation or solicitation of any offer to buy any security or other financial instrument by City Index Limited (“City Index”) or Online-Spread-Betting.com, nor shall it, or the fact of its distribution, form the basis of, or be relied upon in connection with, any contract relating to such action. The material is not a personal recommendation and you should seek independent advice as to your suitability to speculate in any related markets..

City Index is a spread betting and CFD provider and is authorised and regulated by the Financial Services Authority (no. 113942) whose head and registered office is Park House, 16 Finsbury Circus, London EC2M 7EB (Registered in England and Wales, no. 1761813).

A daily look at the Markets from Nick Serff, Market Analyst, City Index.

Investors remained perplexed as to whether to build on equity positions or not as we head into the end of the quarter and a long bank holiday weekend.

The miners are stronger yet again, with the sector benefitting from stronger Copper prices and were it not for the miners, European Index Spreads would be trading more negatively.

The FTSE 100 briefly hit a new 21 month high this morning but gains quickly retreated as the banks dragged Indices lower as the day progressed.

Miners lifted on Vale/BHP news

The news that Vale and BHP have reached an agreement with Japanese steel mills to base pricing on a quarterly basis, as opposed to the long standing annual basis could potentially be big news for the miners.

Analysts have maintained that annualised contracts were costing miners billions of dollars in lost revenue as a result of volatile spikes in spot prices.

Should Rio Tinto reach a similar deal, it could help miners to maximise revenue and this is why the news is having such a beneficial affect on the mining sector today.

Final revised GDP better than expected

The final revision of UK GDP for Q4 came in better than expected but had largely little effect on equity markets. To hear that Britain emerged from its worst post war recession stronger than expected is clearly good news for future growth.

However, there remains a lot of uncertainty as to whether this momentum can carry and future GDP predictions are fluctuating on a monthly basis.

Contracts for differences (“CFD”) trading and spread betting carries a high level of risk to your capital with the possibility of losing more than your initial investment and may not be suitable for all investors. Ensure you fully understand the risks involved and seek independent advice if necessary.

This material should not be construed in any circumstances as a recommendation or offer to sell or recommendation or solicitation of any offer to buy any security or other financial instrument by City Index Limited (“City Index”) or Online-Spread-Betting.com, nor shall it, or the fact of its distribution, form the basis of, or be relied upon in connection with, any contract relating to such action. The material is not a personal recommendation and you should seek independent advice as to your suitability to speculate in any related markets..

City Index is a spread betting and CFD provider and is authorised and regulated by the Financial Services Authority (no. 113942) whose head and registered office is Park House, 16 Finsbury Circus, London EC2M 7EB (Registered in England and Wales, no. 1761813).

A daily look at the Markets from Joshua Raymond, Market Strategist, City Index.

Equities in Europe climbed in early trade on Monday as investors capitalised on stronger commodity prices to push Europe’s benchmark Indices higher by 0.4%.

The key to today’s gains has been the mining sector.

Both Copper Spreads and Gold Spreads have been driven higher thanks to the weaker US Dollar.

This has helped to entice buyers into the mining sector today, which is the standout gainer so far and the main engine behind today’s Index gains. Xstrata, Rio Tinto, and Kazakhmys are all standout gainers in early trade.

Vodafone rallies on dividend talk

Another key driver behind today’s early gains is high demand for Vodafone shares, which currently tops the FTSE 100 winners list, rallying over 3%.

Investors have moved quickly to buy Vodafone after a report in the Sunday papers that the telecom giant is in talks with its joint venture partner Verizon over a potential dividend payment, helping to lift shares to within 1% of a new 20 month high.

Also see Vodafone Spreads.

BSkyB falls on UBS downgrade

BSkyB is the main faller in the UK today on the back of a downgrade by UBS. UBS cut its rating on the firm to ‘neutral’ from an original ‘buy’ position.

The bank noted that the recent upsurge in share prices may have been overdone and that a potential ofcom ruling on sports/movies packages to third parties could be cut by more than first expected, potentially triggering a downgrade to EPS estimates.

This has got shareholders a little nervous and they have moved to reduce holdings as a result this morning.

Non Farms a focus

Investors continue to focus on the macro economic situation to provide further clues of the strength of the economic recovery.

We have a lot of economic data to get through this week with the highlight being March’s US jobs data.

An interesting point will be that Non Farm Payroll’s fall on a day when Europe’s markets are closed due to the bank holiday.

Therefore, with Non Farms expected to show the first creation of jobs since December 2007, we may see investors in Europe position themselves for this data as we approach Friday.

Contracts for differences (“CFD”) trading and spread betting carries a high level of risk to your capital with the possibility of losing more than your initial investment and may not be suitable for all investors. Ensure you fully understand the risks involved and seek independent advice if necessary.

This material should not be construed in any circumstances as a recommendation or offer to sell or recommendation or solicitation of any offer to buy any security or other financial instrument by City Index Limited (“City Index”) or Online-Spread-Betting.com, nor shall it, or the fact of its distribution, form the basis of, or be relied upon in connection with, any contract relating to such action. The material is not a personal recommendation and you should seek independent advice as to your suitability to speculate in any related markets..

City Index is a spread betting and CFD provider and is authorised and regulated by the Financial Services Authority (no. 113942) whose head and registered office is Park House, 16 Finsbury Circus, London EC2M 7EB (Registered in England and Wales, no. 1761813).

A daily look at the Markets from Joshua Raymond, Market Strategist, City Index.

A late sell off in the US towards the close last night has made investors in Europe a little hesitant today.

The gains yesterday were sharp and with the Dow Jones eradicating triple digital gains by the end of the session, investors today are a little uncertain as to how sincere yesterday’s gains were. Therefore, we have seen some bouts of profit taking as a precaution in case we see similar moves in Europe to the US last night.

The major heavyweight sectors are all relatively weaker with a stronger US dollar putting pressure on commodity prices. The banks, the main gainers in yesterday’s stronger market, are also weaker with investors scaling down some positions.

The FTSE 100 and Dax have now gained 14% and 13% respectively since early February which is a terrific run and it appears that every micro and macro hurdle that is thrown at equities they seem to overcome them and race higher which is a very positive sign.

The FTSE 100 broke through the 5700 level without too much resistance and now looks firmly positioned for an attack at the major psychological 6000 level in the near to medium term.

Also see Index Spreads.

US GDP and Michigan Confidence in focus

Investors will look ahead to the final US GDP reading for Q4 and Michigan consumer confidence, both of which is also keeping a few traders from building position in the morning’s session.

The market is expecting no change to last months revised 5.9% reading, though investors are ready to position themselves should a surprise emerge.

Euro not out of the woods yet

We have seen buyers of the Euro after the confirmation of a Greece bail out package, helping to lift the Euro from 10 month lows against the US dollar.

However, we have not seen investors come back to the Euro en masse and this emphasises that the sovereign debt problems in the Euro zone does not end with the bail out itself.

Euro buyers are likely to focus on whether austerity measures gain traction and see if there is any further spill over into the wider EU community, particularly after Fitch downgraded Portugal’s debt rating earlier in the week.”

Contracts for differences (“CFD”) trading and spread betting carries a high level of risk to your capital with the possibility of losing more than your initial investment and may not be suitable for all investors. Ensure you fully understand the risks involved and seek independent advice if necessary.

This material should not be construed in any circumstances as a recommendation or offer to sell or recommendation or solicitation of any offer to buy any security or other financial instrument by City Index Limited (“City Index”) or Online-Spread-Betting.com, nor shall it, or the fact of its distribution, form the basis of, or be relied upon in connection with, any contract relating to such action. The material is not a personal recommendation and you should seek independent advice as to your suitability to speculate in any related markets..

City Index is a spread betting and CFD provider and is authorised and regulated by the Financial Services Authority (no. 113942) whose head and registered office is Park House, 16 Finsbury Circus, London EC2M 7EB (Registered in England and Wales, no. 1761813).

A daily look at the Markets from Joshua Raymond, Market Strategist, City Index.

The FTSE 100 and Dax powered to new 21 month and 18 month highs respectively on Thursday as US jobless claims declined and UK Retail Sales showed surprising strength in February.

Investors also grew more optimistic that a resolution to Greece’s debt troubles is nearing.

It has been a day of multiple good news stories both on a macro level and a corporate earnings front. This is along with rising optimism that the EU summit will result in a coordinated and definitive aid package to help Greece curb its massive deficit.

Investors have had lots of reasons to feel cheerful and buy stocks today.

If we do get a resolution on a Greek bail out proposal at the EU summit today, it will likely lift a timely heavy burden from the Euro that has been suffering much of late. It has fallen to new 10 month lows against the US Dollar.

Indeed, as anticipation of a bailout grew throughout the afternoon, we already started to see investors returning to buy the Euro and this may well continue if there is to be an agreement confirmed.

UK Retailers in Demand

Next and Kingfisher have both delighted the market with better than expected earnings.

Next saw profits rise 18% to £505m for the year, higher than the £500m anticipated.

Kingfisher also beat estimates to post a 49% rise in profit to £547m for the year. However, its shares came under pressure, bucking a stronger retail sector. Investors were left disappointed with a 5% increase in dividends to 5.5p. The market had hoped for 6.5p.

US Jobless Claims and UK Retail Sales Improve

The number of US workers filing for benefits hit fell sharply last week to 442,000, less than expected and hitting a new 18 month low.

UK Retail Sales also grew at a much faster pace than expected in February, with monthly sales growing 2.1% when a smaller 0.7% growth was predicted.

Both the Retail Sales and jobless claims have helped trigger demand for stocks today.

However, there does remain a rather large question mark on the medium to long term temperature of the UK high street, with likely government spending cuts, tax rises and more cost pressures on the consumer to come after the impending General Election.

This is likely to be when the high street will face its toughest test. Whilst the news from both Kingfisher and Next has delighted today, there remains much caution as to how retailers will perform in the next 12 months.

Thomas Cook

Shares in Europe’s second largest holiday firm Thomas Cook rose to the top of the FTSE 100 leader board after the travel company announced that summer holidays had picked up across all markets and were selling at 2% higher prices than last year.

This pleased investors and the travel sector as a whole, triggering strong demand for its shares.

Contracts for differences (“CFD”) trading and spread betting carries a high level of risk to your capital with the possibility of losing more than your initial investment and may not be suitable for all investors. Ensure you fully understand the risks involved and seek independent advice if necessary.

This material should not be construed in any circumstances as a recommendation or offer to sell or recommendation or solicitation of any offer to buy any security or other financial instrument by City Index Limited (“City Index”) or Online-Spread-Betting.com, nor shall it, or the fact of its distribution, form the basis of, or be relied upon in connection with, any contract relating to such action. The material is not a personal recommendation and you should seek independent advice as to your suitability to speculate in any related markets..

City Index is a spread betting and CFD provider and is authorised and regulated by the Financial Services Authority (no. 113942) whose head and registered office is Park House, 16 Finsbury Circus, London EC2M 7EB (Registered in England and Wales, no. 1761813).

The Financial Fixed Odds update from David Evans, Market Analyst, BetOnMarkets.

 
Less than five hours into Wednesday’s session we’re already seeing some interesting trends emerging.

Firstly, there is a general flight away from the ‘risky’ currencies of the Australian Dollar, Euro and Pound and into the ’safer’ currencies of the US Dollar and Japanese Yen.

So far the biggest faller is the EUR/USD which is very close to breaking through to fresh new lows for 2010.

The Greek saga has rumbled on without resolution and the latest news hasn’t been received well by markets.

Apparently Germany and France are pushing for an IMF solution rather than a Europe wide solution which has caused some to question the strength of the Eurozone unity.

However, things are unlikely to stay as they are for long with a number of high profile economic announcements due today.

Impacting the Euro, we have a raft of European, French & German Manufacturing and services data released from 08.00 to 09.00 with European industrial new orders at 10.00.

Alongside this there is the continuing European summit on Greece which creates a potential minefield of unexpected announcements throughout the day.

At 12.30 trading floors will be watching the UK budget announcement very closely. It’s no exaggeration to say that it is one of the most important budgets for decades.

It may be best to let the initial reaction to the budget settle in before placing any trades on the GBP/USD or GBP/JPY.

What the government thinks voters want to hear and what the markets want to see are two very different things. The Pound could be very volatile in the short term as traders weigh up the impact of the budget on the UK economy and the outcome for the next general election.

In addition to this, we have US durable goods orders at 12.30 and new home sales at 14.00.

This website content does not constitute investment advice. No individual contributor, contributing company, BetOnMarkets nor Online-Spread-Betting.com accept any responsibility for any use that may be made of the content.

The Financial Fixed Odds update from David Evans, Market Analyst, BetOnMarkets.

 
During the first bear market of the 2000’s, it was the tech stocks that led markets lower but…

during the credit crunch era, tech stocks held their own as traditionally ’safe’ sectors such as banking collapsed.

Now tech stocks are taking the lead, easily outpacing other sectors as the credit crunch begins to wane.

The Nasdaq 100 (aka US Tech 100) is the home of the world’s biggest tech companies from Amazon to Apple.

By contrast the older Dow Jones (Wall Street) is made up of more traditional companies such as General Electric, and until recently, the banks.

Last night the Nasdaq 100 broke to new highs for the year, but yesterday’s performance was no flash in the pan.

The Nasdaq is now just 13% below its 2007 high vs -24% for the Dow Jones (Wall Street) and -26% for the wider S+P 500.

Will the Tech Stocks continue to charge higher?

This website content does not constitute investment advice. No individual contributor, contributing company, BetOnMarkets nor Online-Spread-Betting.com accept any responsibility for any use that may be made of the content.

The Financial Fixed Odds update from David Evans, Market Analyst, BetOnMarkets.

 
In early trading this morning we’re seeing a move against the yen as investors…

regain their appetite for risk and hunt out higher yielding assets.

So far the euro appears to be the currency of interest as the pendulum confidence surrounding the Greek crisis swings over to the optimistic side.

Today is, so far, the first time in 5 days that the yen has lost ground to the euro.

The dollar and yen have been cancelling each other out of late.

The Dollar-Yen market is stuck in a 100 pip range. Is a breakout imminent?

Coming up today we have UK inflation data (CPI) at 09.30, followed by realised sales from the CBI at 11.00.

The pound has been acting strangely of late with good economic news resulting in a weakening in the pound.

This may be due to good news strengthening Labour’s election chances which in turn may mean a hung parliament which the markets hate the prospect of.

The next announcement of note is US existing home sales at 14.00 which slight easing in the pace of growth expected.

This website content does not constitute investment advice. No individual contributor, contributing company, BetOnMarkets nor Online-Spread-Betting.com accept any responsibility for any use that may be made of the content.

A daily look at the Markets from Joshua Raymond, Market Strategist, City Index.

“A surprise Indian interest rate hike increased fears that the wider economic recovery could cool, triggering weakness in the benchmark European Index Markets on Monday.

India rate hike fuels growth fears

The rate hike from India came as a bit of a shock. When you align this decision with recent moves by China to cool excessive growth there too, the emerging markets picture is developing into one of concern that it could slow the wider economic recovery.

The resurgence in demand for basic metals in emerging markets has played a strong hand in the recovery of the global equity markets, particularly with the miners being heavyweights in European Indices.

The fear is that by cooling growth there, it may scupper demand for metals and this in turn could have negative consequences on the ability of European Indices to power ahead.

As a result of the move by India, commodity stocks are particularly weak today and this is most of the Index losses have originated from so far, with Vedanta, Eurasian Natural Resources and Kazakhmys all down by over 3%.

Investors in defence mode

The losses today have gathered pace throughout the morning’s session which is a bit of a concern.

If we lose another 1% or so, it could encourage those investors who had been holding out for more upside movement in the last week to scale down positions, and this may trigger wider consolidation in the markets.

It is also interesting to see the key defensive sectors stronger today too.

Both pharmaceutical and tobacco firms are higher, along with a stronger US Dollar, which affirms that investors have started the week in defence mode.”

Contracts for differences (“CFD”) trading and spread betting carries a high level of risk to your capital with the possibility of losing more than your initial investment and may not be suitable for all investors. Ensure you fully understand the risks involved and seek independent advice if necessary.

This material should not be construed in any circumstances as a recommendation or offer to sell or recommendation or solicitation of any offer to buy any security or other financial instrument by City Index Limited (“City Index”) or Online-Spread-Betting.com, nor shall it, or the fact of its distribution, form the basis of, or be relied upon in connection with, any contract relating to such action. The material is not a personal recommendation and you should seek independent advice as to your suitability to speculate in any related markets..

City Index is a spread betting and CFD provider and is authorised and regulated by the Financial Services Authority (no. 113942) whose head and registered office is Park House, 16 Finsbury Circus, London EC2M 7EB (Registered in England and Wales, no. 1761813).

A daily look at the Markets from Joshua Raymond, Market Strategist, City Index.

“The markets recovered yesterday’s losses to push higher on Friday on Quadruple Witching Day, led chiefly by gains in the banking sector after a bullish trading update by Lloyds Banking Group.

With a distinct lack of economic data today, investors are likely to focus on the Lloyds news and contracts expiry.

Lloyd’s update boosts banking sector

Lloyds have come out and surprised the market with an upbeat trading statement saying that they will return to profitability in 2010.

The news is giving its shares, and indeed the whole banking sector, a big lift today, particularly as Lloyds disappointed the market with their earnings last month.

A return to profitability would be seen as a significant step in the banks recovery after two years of straight losses and this is why shareholders have reacted very well to the news, rallying shares in Lloyds higher by over 7%.

Quadruple Witching Day

The markets tend to be a bit jump on Witching Days, when a combination of futures and options expire and we have already seen elements of this in the morning’s session.

With the majority of European contracts expiring before lunch time, and without any significant economic data due out either, we may see the markets drift in the afternoon towards the close.”

Contracts for differences (“CFD”) trading and spread betting carries a high level of risk to your capital with the possibility of losing more than your initial investment and may not be suitable for all investors. Ensure you fully understand the risks involved and seek independent advice if necessary.

This material should not be construed in any circumstances as a recommendation or offer to sell or recommendation or solicitation of any offer to buy any security or other financial instrument by City Index Limited (“City Index”) or Online-Spread-Betting.com, nor shall it, or the fact of its distribution, form the basis of, or be relied upon in connection with, any contract relating to such action. The material is not a personal recommendation and you should seek independent advice as to your suitability to speculate in any related markets..

City Index is a spread betting and CFD provider and is authorised and regulated by the Financial Services Authority (no. 113942) whose head and registered office is Park House, 16 Finsbury Circus, London EC2M 7EB (Registered in England and Wales, no. 1761813).