- Wall Street trades listlessly, Asian markets mixed
- Crude Oil slips further below $80.
- FTSE titans heading in opposite directions after trade updates.
- Retailers struggle as sales turn sharply lower.
Steve Clayton, head of equity funds, Hargreaves Lansdown:
“Wall Street traded listlessly last night, with Tech struggling to find any real direction. The wider market was held back by energy stocks, with consumer names from Tesla to McDonalds taking the lead. Overall, both the NASDAQ and the S&P 500 indices inched 0.1% ahead over the session. The dollar had a mixed day, regaining a little ground against the Japanese Yen to \154.9, but weakening against a raft of other Asian and European currencies.
Markets generally are in a nervy mood, with interest rates decisions from the US Federal Reserve, the ECB and the Bank of England all expected this week, along with euro area GDP data. With markets still pricing in rate cuts before year end, each month raises the pressure to see them actually delivered.
Crude Oil’s ongoing weakness lays behind much of the drop in Energy stocks, with Brent futures slipping further below the key $80 level to trade around $79.63 this morning. Traders are struggling to see anything other than a fully supplied market for crude in the months ahead, suggesting that major producers are going to need to show supply restraint if prices are to make any sort of meaningful recovery.
With earnings season in full swing, there are several FTSE 100 names making big moves this morning on the back of their figures. The headlines are that Diageo, Croda International and Sage Group are all heading south this morning after reporting results that left traders worrying about weak momentum in these stocks’ underlying revenues. On the leaderboard though, BP is up after hiking its quarterly dividend by 10%, whilst Standard Chartered released forecast-beating results and announced a further buy-back of stock.
News from the UK retail sector this morning is grim. The CBI’s Distributive Trades retail sales survey lurched down to a reading of -43, from -24 the previous month. Economists had been predicting a mild recovery. Martin Sartorius, Principal Economist at the CBI, attributed the drop to poor weather back in June and the uncertain state of the economy in the run up to the general election in July.”
