Weekly Trading Report 14 February 2011 - Last Week's Trading Highlights
The FTSE 100 climbed back above 6000 on Monday as positive broker comments lifted the heavyweight mining sector and copper prices hit a fresh high.
Banks then assumed the spotlight, as the Treasury increased its levy by £800 million, and Project Merlin – an agreement to increase lending and pay lower bonuses in 2011 – was signed midweek.
On Thursday, the harsh winter weather was blamed for the UK trade balance widening in December, reaching £4.8 billion, but retail figures were up 2.3% in January. Despite growing speculation that the MPC might raise interest rates, the 0.5% rate was retained on Thursday.
On Wednesday, the LSE agreed a merger with TMX, operators of the Toronto Stock Exchange, to create what will become the largest exchange for mining companies. Almost immediately, NYSE Euronext and Deutsche Boerse announced they were in talks about a similar transatlantic union.
In America, employment was again the focus, as Fed Chairman Ben Bernanke told the House Budget Committee on Wednesday that he expected unemployment to remain high for ‘several years’. His remarks overshadowed Thursday’s news that US initial jobless claims fell to their lowest level since 2008. Looking east, China raised interest rates for the third time in four months to fight further inflationary fears.
Beverages giant Coca Cola reported on Wednesday that fourth-quarter net income more than tripled and revenue rose 40%. Industry peer Pepsi, however, admitted a 5% fall in fourth-quarter net profit the following day.
In the UK on Thursday, distiller Diageo reported 4% and 2% growth in organic sales and operating profit respectively, but both fell well short of analysts’ estimates. Later Rio Tinto saw annual profit almost triple to £8.9 billion, and at Rolls-Royce underlying pre-tax profit, excluding one-off costs, was up 4% in 2010. In the US, Walt Disney saw fourth-quarter profit rise by more than 50% to $1.3 billion.
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Weekly Trading Report 14 February 2011 - The Week Ahead
Indicators
After a quiet start to the week in the UK, Tuesday’s CPI and RPI data is followed on Wednesday by jobless figures and the BoE’s inflation report.
With domestic inflation spiralling recently and budget cuts expected to affect unemployment, these reports will be watched closely.
In the US, housing starts and industrial production figures are scheduled on Wednesday, before the week finishes with US inflation data on Thursday and UK retail sales on Friday.
Company Results and Reports
At home, miners are in focus on the company calendar with annual results from Anglo American on Friday and African Barrick Gold on Wednesday, while BHP Billiton also releases interims midweek.
Barclays and BAE Systems unveil full-year figures on Tuesday and Thursday respectively, while in the US, quarterlies come from Dell on Tuesday and Deere & Co on Wednesday.
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For previous weeks see below.
Note - Spread Betting carries a high level of risk to your capital and you can lose more than your initial investment, it may not be suitable for all investors. Ensure you only speculate with money that you can afford to lose and that you fully understand the risks involved and seek independent financial advice where necessary.
'Financial Spread Betting 14 February 2011', Review by D. Jones, last update: 14-Feb-11
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