UK Market Comments

Heading into the close the FTSE 100 is down 30 points, at 6618, as the biggest British banks lead the market lower.

UK markets

In London, Standard Chartered and HSBC have been hammered by the riots in Hong Kong. The unease in the Far East has sent a shockwave around the world, and the London-listed finances houses have seen their shares take a tumble as both have large exposure to Asia. There is no stopping the selloff in the supermarkets as the high street names still remain unpopular with dealers. Sainsbury’s will issue a trading statement on Wednesday but it will be a tough sell to talk round traders. Mining stocks keep sinking, and concerns over global demand for metals is chipping away at share prices. Shareholders in Balfour Beatty must be fuming with the company’s board of directors for rejecting the
Carillion takeover bid last month. The construction company issued a profit warning, sending its shares to an 11-year low.

US markets

In the US, the Dow is down 75 points, at 17,037, as the rumblings in Hong Kong have rattled Wall Street. TIBCO Software is up 20% following news that it is being taken over by private equity house Vista Equity Partners for $4 billion. In other M&A news, shareholders in DreamWorks Animation are living the dream after SoftBank expressed an interest in acquiring the company. The stock has risen 17% following the news.

Commodities

Gold is hovering around the $1220 level. The US jobs report on Friday could paint a clearer picture as to what the Fed will do regarding interest rates, and gold is being squeezed on two fronts. First the strong greenback and second the potential shift to interest-bearing products should the Fed raise rates. Friday’s COT report showed speculators had reduced their bullish bets on gold to the lowest levels since January.

FX

The euro and the pound have managed to stem the advance of the almighty dollar, but it is more to with traders banking their profits from the dollar bull run.