Weekly Trading Report 24 January 2011 - Last Week's Trading Highlights
After pushing through 6050 this week, the FTSE 100 fell to a five-week low on Thursday. Anxious investors were spooked by the release of China’s GDP figures, with the faster-than-expected 10.3% rise putting further pressure on high inflation rates. Beijing is expected to impose more extreme fiscal measures, triggering fears of a slowdown in the world’s second-largest economy.
A series of disappointing updates from Wall Street also affected investor confidence, as Citigroup and Goldman Sachs reported lower-than-expected profits on Wednesday and Thursday respectively. Low client activity and weak debt trading saw Goldman Sachs’ net income fall 53% from a year ago.
In contrast to its peers, Morgan Stanley unveiled a 60% leap in fourth-quarter profit on Thursday, while Apple hit headlines on Tuesday with a record $6 billion profit in the last quarter. Analysts quickly responded to the consumer technology company's stellar performance, tipping target share prices to rise above $425 despite concerns over Steve Jobs’ health.
At home, BP shares climbed on Monday following news of its deal to explore Russia’s Arctic shelf with state-controlled Rosneft. Primark also saw profits rise as savvy consumers switched to discount retailers over the festive season, despite official figures showing the high street suffered its worst December on record.
ONS figures on Tuesday showed UK inflation hit a higher-than-forecast eight-month high of 3.7% last month. This is up from 3.3% in November and is nearly double the Bank of England’s 2% target rate. Analysts remain divided over whether the BoE should raise interest rates or hold firm in the face of increased pressure from public sentiment and the government.
Midweek headlines were taken by the latest UK unemployment data, with the overall figure increasing by 49,000 to almost 2.5 million in the three months to November. A record one in five 16- to 24-year-olds is now out of work.
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Weekly Trading Report 24 January 2011 - The Week Ahead
Indicators
The state of the economic recovery is tested on both sides of the Atlantic this week as Q4 GDP figures are released in the UK on Tuesday and the US on Friday. On Wednesday the Fed reveals its US rate decision, while at home January’s MPC minutes will be eagerly awaited.
Elsewhere in the online spread betting markets, US December home sales are in the spotlight with new and pending figures coming on Wednesday and Thursday respectively.
Company Results and Reports
A packed reporting week in the US sees telecommunications bellwether Verizon and online giant Yahoo release quarterlies on Tuesday, ahead of peers Motorola Solutions, AT&T and Amazon on Thursday. Microsoft and Procter & Gamble also report earnings on Thursday, while at home Q4 results from Kazakhmys and interims from BSkyB complete a busy day.
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Remember that financial spread betting is a leveraged product and can result in losses that exceed your initial deposit. Spread betting may not be suitable for everyone, so please ensure that you fully understand the risks involved.
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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 24 January 2011', Review by D. Jones, last update: 24-Jan-11
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