Spreadex Market Update
FTSE flat as Tesco losses and SABMiller gains battle for dominance
Tuesday’s economic growth cutting news from the IMF, as the Washington-based institution lamented the ‘elusive’ search for ‘synchronised global expansion’, was joined this morning by the latest bit of dreary data from Germany, with the country’s industrial production coming in at -1.2% for August, well below the 0.3% increase expected. That figure joins a string of other worrying numbers that could suggest a rusting core at the (undoubtedly German) heart of the Eurozone. None of this faxed the DAX at the open, as it jumped by 40 points, only for its nascent gains to gradually dissipate as investors got into the swing of things.
The FTSE was caught between duelling components this morning; Tesco, with its whopping 55% decline in half year profit, fell by over 2% and caused losses to trickle through the rest of the sector. However, this was countered by SABMiller; whilst the drinks giant dropped yesterday on the toxic combination of a weak trading update and reports that it rejected an informal offer from Anheuser-Busch InBev, it has been lifted by 3% this Wednesday after news of raised bid from its would-be suitor. The relative stalemate between two of its bigger stocks has left the UK index rather flat this morning, struggling to improve on yesterday’s close.
The UK has its own manufacturing and industrial production figures to come later in the morning, both expected to improve on the negative numbers seen last month; however, as has been shown in Germany this morning, European data has been overwhelmingly disappointing of late, so there is a significant chance the UK won’t meet analysts’ estimates.
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