Morning Spread

Morning Spread

Friday 22nd January 2016
IndexLevelChg (%)
UK Market5876.37+1.78
Dow Indust Avg15882.68+0.74
S&P 5001868.99+0.52
Nasdaq Composite4472.06+0.01
Nikkei 22516958.53+5.88
Hang Seng19080.51+2.90
IndexLevelChg (%)
Nymex 1m30.69+3.93
Gold Spot1095.74-0.50
GBP/USD1.4257+0.35
GBP/EUR1.3148-0.36
EUR/USD1.0843-0.01
USD/JPY118.26-0.49

US equities rose on Thursday with the S&P 500 bouncing off a 21 month low, primarily driven by a turnaround in energy prices. There still remains a belief that the current market conditions are somewhat of an overreaction to the Chinese economic reality. Chevron rose 2.6%, Transocean was 7% higher, Conoco enjoyed a 6.2% rise and Nabors was nearly 7% up. Chances of an imminent US interest rate rise continue to diminish and economic data showed a surprise increase in unemployment benefit claimants to a 6 week high. Banks were a notable exception with declines across the board, Bank of America lost 2.4% and Bank of New York Mellon fell just over 3.2%. Domestic earners proved strong with Home Depot up 3.2% and Wal Mart up 1.7%.

Asia witnessed a strong trading session with notable strength in Japan seeing the Nikkei rise an incredible 5.9%. Hong Kong was up just shy of 3%, with South Korea up 2% and Shanghai lagging up 1.25%. In Australia, there was a particularly strong performance from Treasury Wine which stormed ahead by 17.5%. The owner of the Penfolds and Wolf Blass brands reported higher than expected earnings, primarily driven by China. Energy stocks were buoyed by the crude oil price rising back through the $30 level with Petrochina up 8%, Cnooc up 8% and Sinopec up 6.4%. Japanese investors were convinced that the Central Bank would undertake more easing and volumes were decent. Dai-ichi Life gained 6.3%, Japan Tobacco was up 6.5%, Makita gained nearly 8% and Softbank was also 8% higher.

Europe is adding to the rally started yesterday with the MSCI Euro index up 2%, the FTSE 100 is 1.7% higher, the CAC 40 in France is up 1.9% and the German DAX is 1.4% up. Energy remains a sector in focus with Royal Dutch Shell in powerful form up 4%, this has helped BG Group up 3.2%, Statoil is up nearly 5% and Total is up 3%. Other gainers include Vivendi up 2.75%, LVMH up 2.6%, Swiss Re is 2.15% higher and Den Norske Bank is up just over 2.5%. The embattled mining sector is also rallying with BHP Billiton up 3.5% and Rio Tinto up 2.7%. There are virtually no fallers, although the media company Pearson is down 2.5% after very strong gains yesterday on hopes the dividend will be maintained.