Weekly Trading Report 27 September 2010 - Last Week's Trading Highlights
Rating agency Moody’s credited the government’s austerity measures with securing the UK’s AAA credit rating on Monday, helping the FTSE add 94 points (+1.7%) to 5602.54. This was its highest closing level since April, however it slipped into a gradual decline throughout the rest of the week.
Also on Monday, the Centre for Economics and Business Research said the world economy will avoid a double-dip recession, but still reduced their 2011 global growth forecast from 3.7% to 3.5%.
The CBI similarly altered this year’s UK GDP expectation, to 2% from 2.5%. The outlook in Europe appeared shakier: Thursday’s services and manufacturing data revealed a sharp slowdown in September, while Irish GDP fell 1.2% in the second quarter against the previous three months.
In the UK, Monday’s mortgage lending data fairly reflected the struggling property market: Lending dropped again in August, with the number of homes sold sliding by 5000 to 85,000.
On Tuesday the ONS revealed that UK public sector borrowing reached a record £15.9 billion in August, although the forecast for 2010-11’s total borrowing is £6 billion lower than last year’s.
Wednesday’s Bank of England minutes once again showed an 8-1 vote in favour of prolonging the current 0.5% interest rate, also revealing that some members believe further stimulus may be needed to aid the UK economy.
Elsewhere in spread betting news, the airline industry received a boost last week as the International Air Transport Association (IATA) upgraded its 2011 profit forecast from an earlier $2.8 billion loss to a gain of $8.9 billon.
IATA linked the recovery to an improvement in demand and a stabilisation of costs, but warned that the strength of the recovery is not secure and that Europe remains likely to draw a loss.
At home, retailer JD Sports posted a six-month profit of £16.6 million on Tuesday, attributing the 64% year-on-year increase in part to last summer’s World Cup.
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Weekly Trading Report 27 September 2010 - The Week Ahead
Indicators
In macroeconomic news, consumer sentiment figures for the US, UK and Eurozone are announced throughout the week. The latest UK mortgage approvals data will be of interest on Wednesday.
Investors will be looking for signs of economic recovery from the final Q2 GDP at home on Tuesday. The latest manufacturing output from the UK, Eurozone and US will also be of use as the week closes.
Company Results and Reports
Building materials supplier Wolseley releases annual results on Monday, with fellow blue-chip Smiths Group also unveiling full-year numbers midweek. Half-year figures from retailer JJB Sports are being released on Tuesday and M&C Saatchi on Wednesday. Both are worth keeping an eye on.
Across the Atlantic, key figures include quarterlies from chain store owner Family Dollar and America's largest drug store, Walgreen.
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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 27 September 2010', Review by D. Jones, last update: 27-Sep-10
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