It is a good morning for stocks, with the FTSE 100 up 50 points in early trading and US futures pointing towards a solid open this afternoon.
-
Stock markets recoup some lost ground.
-
Earnings reports justify optimistic outlook.
-
Dunelm steady in wake of update.
Equity markets appear to have shaken off their caution of recent weeks and are moving higher in unison this morning. Yesterday’s strong US CPI print and this morning’s robust Chinese PPI figure have not dented investor enthusiasm for stocks, after US earnings season got off to a good start from JPMorgan. The earnings call provided plenty of reasons to be cheerful, with the bank noting that the overall US recovery was intact and credit demand was still strong. LVMH’s numbers this week built on this theme, and TSMC’s figures overnight reinforced the view of a global economy that is still moving in the right direction, albeit at a slower place. Having dropped back in an orderly fashion into earnings season, it seems stock markets have now reached a level at which investors are once again happy about buying the dip, hence the broad recovery in indices this morning.
Gains in Dunelm have been reversed to an extent in morning trading, but after a nasty drop for the month so far a more positive view is emerging. The comments on margin reflect justified caution about the outlook for the second half, but it seems the UK consumer is still happy to spend on home furnishings, which chimes nicely with Barratt’s numbers yesterday. The past four weeks have seen the shares surge and then slump, but with the numbers out the way a more steady recovery is likely from here.
Ahead of the open, we expect the Dow to start at 34,580, up 203 points from last night’s close.
This information has been prepared by IG, a trading name of IG Markets Limited. In addition to the disclaimer below, the material on this page does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. IG accepts no responsibility for any use that may be made of these comments and for any consequences that result. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. Any research provided does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it. It has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Although we are not specifically constrained from dealing ahead of our recommendations we do not seek to take advantage of them before they are provided to our clients.
Recommended Content
Editors’ Picks
EUR/USD hovers around 1.0700 after German IFO data
EUR/USD stays in a consolidation phase at around 1.0700 in the European session on Wednesday. Upbeat IFO sentiment data from Germany helps the Euro hold its ground as market focus shifts to US Durable Goods Orders data.
USD/JPY refreshes 34-year high, attacks 155.00 as intervention risks loom
USD/JPY is renewing a multi-decade high, closing in on 155.00. Traders turn cautious on heightened risks of Japan's FX intervention. Broad US Dollar rebound aids the upside in the major. US Durable Goods data are next on tap.
Gold price trades with mild negative bias, manages to hold above $2,300 ahead of US data
Gold price (XAU/USD) edges lower during the early European session on Wednesday, albeit manages to hold its neck above the $2,300 mark and over a two-week low touched the previous day.
Worldcoin looks set for comeback despite Nvidia’s 22% crash Premium
Worldcoin price is in a better position than last week's and shows signs of a potential comeback. This development occurs amid the sharp decline in the valuation of the popular GPU manufacturer Nvidia.
Three fundamentals for the week: US GDP, BoJ and the Fed's favorite inflation gauge stand out Premium
While it is hard to predict when geopolitical news erupts, the level of tension is lower – allowing for key data to have its say. This week's US figures are set to shape the Federal Reserve's decision next week – and the Bank of Japan may struggle to halt the Yen's deterioration.