US courtroom drama spills over onto European market

Two high-level court cases involving close associates of President Donald Trump which came to a resolution last night are injecting fresh uncertainty into the US markets and are spilling over into Europe. After opening a notch higher the FTSE is now heading lower taking its cue from falling US stock futures.  

In the first case President Trump's former lawyer Michael Cohen has pleaded guilty in a New York court for violating campaign finance laws and said he did it at the President’s direction. Although Cohen’s comment implicates Trump the President is unlikely to face criminal charges as long as he remains in his current position. 

Issues became even more complicated when Trump’s former campaign chairman Paul Manafort was found guilty on eight charges including tax fraud, bank fraud and failing to disclose foreign bank accounts. 

Sterling still rallies but at a slower pace

The pound’s big rally Tuesday of over 0.6% seems to be in the rear view mirror this morning as sterling trades flat against the dollar and up 0.15% against the common currency. Sterling’s short lived recovery was prompted by the report of the biggest government surplus in 18 years and although the market is sobering up this morning the sizeable surplus will provide a cushion for the financial blows which are likely to be created by Brexit. 

US-China trade talks start

In amidst the political mayhem that is whipping up around Trump the markets mostly ignored a piece of good news which would have been welcomed on a quieter day. US and Chinese officials are due to start trade talks Wednesday, picking up where they left off last time when trade talks broke down.

The issues involving the large surplus of Chinese exports to the US remain the crux of the discussions with the US using higher and higher tariffs as its main negotiating tool. The talks are a precursor to a high level meeting between President Trump and his Chinese counterpart later this year. 

US sports betting market holds much promise for Sportech

The US sports betting market holds much promise for Sportech but the company doesn't have a great track record when it comes to making new investments work.
Recent failures have included a sports betting venture in India that became 'almost dormant' and had to be terminated.
Sportech's first branded sports bar in San Diego didn't perform as well as hoped and according to today's earnings update its latest bar in Stanford has gotten off to a shaky start, too.
Sportech has a strong foothold in the Connecticut market, which may allow more wagering to occur after the US Supreme court's decision in May to strike down a ban on sports betting. And let's not forget that the US economy is growing solidly.
Even in a growing economy, past failures mean the company's new CEO, CFO and chairman -- all hired within the last year or so -- have their work cut out to prove that Sportech shares are worth a punt.

Grafton Groups earnings comfortably beat expectations

Revenue figures were already out so the market was looking at Grafton's margin performance and it hasn't disappointed.
Earnings have comfortably beaten expectations, allowing investors to be rewarded with a hefty increase in the dividend.
In the early months of the second half, the rate of  revenue growth has slowed and management has again warned of pricing pressures in the UK market.
But some sort of slowdown was to be expected after construction surged during May and June to make up for weather-related delays earlier in the year.
Consumer confidence in the UK may be fragile, but government support schemes like Help-to-Buy are set to support the housing construction market for several years to come.
Grafton is also heavily exposed to an Irish economy expected by the local central bank to grow by more than 4% this year and next. The Dutch economy is in full recovery mode, too, highlighting the appeal of the Grafton's geographic spread.