Morning Spread

Morning Spread

Thursday 21st January 2016
IndexLevelChg (%)
UK Market5673.84+0.06
Dow Indust Avg15766.74-1.56
S&P 5001859.33-1.17
Nasdaq Composite4471.69-0.12
Nikkei 22516017.26-2.43
Hang Seng18542.15-1.82
IndexLevelChg (%)
Nymex 1m27.98-1.31
Gold Spot1099.82-0.10
GBP/USD1.4178+0.04
GBP/EUR1.3009+0.18
EUR/USD1.0898-0.22
USD/JPY116.88-0.34

European stocks were positive this morning, ahead of the European Central Bank’s rate decision and comments by Mario Draghi. The ESTX 50 (+0.06%), UK markets (+0.06%), CAC 40 (+0.08%) and the Dax (+0.02%) were all slightly positive in early trading. Draghi will hold a press conference in Frankfurt, 45 minutes after the rate decision is announced. Pearson Plc climbed +5.2% after saying it plans to cut 4,000 jobs, or about 10% of the workforce. Logitech International SA rose +7% after raising its 2016 sales and profit forecasts. St James’s Place Plc added +1.2% after saying clients poured 20% more money into its funds. Deutsche Bank slid -5.8% after saying it will report a loss for the fourth quarter after setting aside more money for litigation and restructuring costs. Marine Harvest ASA fell -2.6% after saying quarterly profit declined.

 

US stocks dropped as oil prices plummeted to 2003 lows. The Dow Jones Industrial Average (-1.56%), S&P 500 (-1.17%) and the Nasdaq Composite (-0.12%) all decreased. The beaten down S&P energy sector fell -2.9%, leading losses. Exxon dropped -4.21% and Chevron slumped -3.1%. Collapsing oil prices and fears of a slowdown in China have led the S&P 500 to drop -9% this year. In the past six months the energy sector has fallen -26%. US crude sank -6.6% as a supply glut together with bearish financial reports that deepened worries over demand. IBM weighed most on the Dow, falling -4.88% after disappointing earnings report. Netflix ended down -0.41% despite better than expected growth in its subscriber base.

 

Asian stocks resumed their selloff as a rally in crude fizzled out and equities in China and Japan reversed early gains. The Nikkei 225 (-2.43%) and the Hang Seng (-1.82%) both declined, while the S&P/ASX 200 (+0.46%) gained. Policy makers are trying to hold borrowing costs down to support China’s economy without spurring an exodus of funds that drove the yuan to a five year low this month. Investors are looking for evidence stocks have hit a bottom, as some market indicators signal the equities selloff has gone too far. Toyota Motor Corp slipped -2.8%, pacing losses among Japanese exporters as the yen strengthened for a second day. Yaskawa Electric Corp dropped -8% after cutting its profit forecasts. China Resources Beer (Holdings) Co tumbled -14% after Macquarie Bank Ltd downgraded its rating on the company.