Wall Street joined the 2012 rally this afternoon, making early gains that were then increased by a positive reading on US manufacturing for December. The month has got off to a good start, although only time will tell if this rally can be sustained in the face of continued bad news in Europe.
By 3.30pm (London time), the Dow Jones was up 2% at 12,461.30, while the S&P 500 had risen 2.01% to 1282.84. In London, the FTSE 100 added to its morning gains and was up 2% at 5683.63.
Global manufacturing picture improves
The manufacturing data out of China and India this morning helped to spark today’s rally, but figures from the Anglosphere have also done their bit to keep sentiment on the bright side.
The UK’s manufacturing PMI rose for December, up to 49.6 from November’s 47.7, and although the figure remains in contraction territory, signs of improvement were gladly accepted by traders.
In the US, the ISM manufacturing index rose to 53.9 from 52.7, hitting a six-month high, and beating the median forecasts of economists.
Demand has been rising on both the export and import fronts, while US data has improved of late across the board, providing fuel for a year-end rally that, for now at least, is continuing into 2012.
More trouble on the frontiers
A government spokesman in Greece has warned that the country may have to leave the Eurozone if it does not secure the latest set of bailout funds.
The Greek government is still struggling to win over the public for the latest set of unending austerity measures imposed on it by the EU and IMF, and the comments are being seen as an attempt to round up more support.
Most Greeks still believe that entering the euro was the correct choice, and thus the government hopes to rally the public behind more austerity measures.
Further measures might be needed in order for Athens to catch up in its reform efforts, due to the slippage that occurred last year.
Meanwhile, jobs data from Spain confirmed something we all knew anyway, that the Eurozone has two sides to it; Germany, and everyone else.
There was no improvement in Spain’s bleak employment landscape during the Christmas period, with unemployment up 0.04% to 4.42 million. Around a third of all unemployed people in the currency union are Spanish, with nearly half of all young Spaniards out of work.
This is a point that non-German leaders will be keen to emphasise at their summit meeting on 30 January, and Germans in general would be well-advised to remember how well they are doing compared to everyone else when they complain about the cost of propping up the euro.
A tale of two retailers
Despite the best efforts of retail analysts to talk it down, Home Retail Group is up 7.8% today, to 89.9p. Recovery hopes may be doing their bit, given that Home Retail was around £2 per share this time last year.
Christmas sales figures will be released next Thursday, but analysts do not expect the situation to get much better at Home’s Argos chain of catalogue shops.
New Year optimism is in short supply at embattled HMV however, which is down 6.6% at just 3.25p, as spread betting investors continue to abandon the company on worries that sales over the New Year were much less buoyant than hoped.
Sales for the record company are forecast to be down around 8% for the period, as the latest reporting season for the sector gets underway.
Most of the major names in retail will update the market in the next few weeks, providing plenty of meat for analysis on the current state of the UK consumer. The ONS will also pitch in on 20 January with its own collection of retail sales figures.
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.
IG Index
- Live Prices, Charts, Indices, Equities, Commodities, Forex and more >> read the
IG Index Review.
The above content does not constitute investment advice, it is provided purely for information purposes and is delivered as a personal view of the writer. Neither the contributing company (or writer) nor Online-Spread-Betting.com accepts any responsibility for any use that may be made of the content.
'Shares Spread Betting: Home Retail Group Defy Analysts as Shares Rise 7.8%', Article by IG Index, last update: 3-Jan-12
Content approved / provided by IG Index which is Authorised and regulated by the Financial Services Authority, FSA Register number 114059.
Related articles:
Spread Betting Daily, 18-Apr-12,
The daily afternoon spread betting update featuring the key stock market indices, forex, shares and commodities markets. Daily updates focus on the spread betting markets as the UK closes and the US continues to...see: Spread Betting Daily
Spread Betting News Daily, 17-Apr-12,
The afternoon spread betting update from IG Index - a look at the spread betting markets with the UK closing and the US markets just...see: Spread Betting News Daily
Looking to improve your trading results? Get free trading tips and trading analysis as well as the latest trading offers »
Trading News.
Risk Warning:
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.
Disclaimer:
Online-Spread-Betting.com does not endorse the information and
analysis available on this site. It is provided purely for information
purposes and is delivered as a personal view of the writer. Under no circumstances
is the information hereon to be used or considered as, an offer to sell, or a
solicitation of any offer to buy. The website content does not constitute investment
advice and neither the individual contributor nor Online-Spread-Betting.com accepts any
responsibility for any use that may be made of the content.
* Tax Free Trading:
Tax law is subject to change. It may also differ if you pay tax in a jurisdiction outside the UK.
