UK Market Comments

For all the noise in the market the FTSE 100 has barely moved. The non-stop stream of corporate updates has kept traders glued to their screens but volatility remains low. It just goes to show that the FOMC is bigger than dozens of earnings updates. The announcements from companies have been better than expected, but most stocks have remained indifferent. Lloyds has lost ground in early trading despite a decline in loan improvements and a jump in its first-half pre-tax profits. It is possible we could see the government selling a stake in the bailed out bank this side of Christmas. Royal Dutch Shell is on the rise after it reported a healthy jump in EPS. The stock is eyeing the £26 level but developments in Russia could hinder this. BG Group is in the black after its EPS increased by 22% on the quarter. The company described the quarter as ‘good’, but with its high energy costs would its clients agree?

In the US, we are expecting the Dow Jones to open 110 points lower at 16,770. Traders know the QE days are numbered and the prospect of no safety net has spooked US equity traders. Exxon Mobil will kick off reporting for the US big oil companies at lunchtime today. Its production levels have fallen in 10 out of the past 11 quarters; the Russian situation isn’t helping.