Weekly Trading Report 28 February 2011 - Last Week's Trading Highlights
BoE minutes released on Wednesday revealed that another MPC member joined the hawks in calling for a rise in interest rates. This led to speculation amongst analysts that a rates increase could be brought forward as early as April.
However, with Friday’s downwards revision of fourth-quarter UK GDP to a 0.6% decline, any change to current policy might have to wait for stronger evidence that the UK economy is recovering.
Despite a week of troubled headlines, UK consumer confidence stabilised in February, marginally up from its record January lows, and London’s FTSE 100 rallied to finish above the 6000 level again.
Crude oil prices were propelled to 24-month highs on Thursday as escalating Libyan conflict disrupted the national output of the world’s 12th largest oil exporter. Amid fears that violence may spread to Algeria and other OPEC states, Brent soared 15% to $120 within four days, triggering concerns that the global economic recovery could be derailed.
Subsequent suppressed risk appetite led to a five-day fall on the FTSE 100, which was halted by a commitment from Saudi Arabia on Friday to make up any shortfall in oil supply. London shares consequently rallied on Friday, despite technical issues suspending trading on the London Stock Exchange for over four hours.
On Thursday Centrica announced record £2.4 billion profits thanks to increased prices over Britain’s coldest winter, but RBS reported a loss of £1.1 billion. This is less than what the state-owned bank reported in 2009, but a £950 million bonus payout has seen it face much censure in the press.
Elsewhere in the spread betting markets last week, Lloyds returned to profit for the first time since the 2008 crash, tripling its annual profits to £2.2 billion. IAG, the newly-formed parent company of BA, reported modest inaugural profits on Friday, up €21 million for the final quarter of 2010, but warned that rising fuel costs may mean fewer flights and increased prices.
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Weekly Trading Report 28 February 2011 - The Week Ahead
Indicators
It’s a relatively quiet week for major economic data, aside from the key US non-farms payroll report on Friday. Wednesday’s Challenger job cuts for February usually hints at what the non-farms might hold, while the Fed’s Beige Book, due the same day, will indicate how the US economy is holding up.
In the UK we’ve got construction and services PMIs due Wednesday and Thursday respectively, while Thursday also has preliminary Q4 GDP data for the eurozone scheduled in.
Company Results and Reports
This week brings a lull in US corporate reports, with few big names among the handful due to post. Things are slightly livelier this side of the Atlantic, with HSBC, Bunzl and media company Pearson jump-starting the week.
Wednesday sees banking group Standard Chartered unveil the state of their finances, while Aviva follows suit on Thursday.
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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 28 February 2011', Review by D. Jones, last update: 28-Feb-11
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