Weekly Trading Update
16.10.15 Friday Morning
Eurozone
Euro markets suffered early in the week, particularly in Germany as Deutsche Bank’s and Volkswagen’s suffering continued. Deutsche posted a colossal third quarter loss and this combined with as the refugee crisis, VW cutting their investment by €1 billion a year, negative inflation and the ZEW economic sentiment plunging all giving the German economy a bearish outlook. However the markets began to recover as investors believe that Mario Draghi may start another quantitative easing scheme.
Next week sees the release of many different PMI figures, including France, Spain, Germany. These should give some indication how the China’s fall in imports has affected each country.
UK
The FTSE recovered after a poor early week to close Thursday at 6402.2, one point down from where it opened Monday. Negative UK inflation and a 20% fall in Chinese imports were the main causes behind this fall with SAB Miller offering little support with Anheuser-Busch InBev agreeing (‘in principle’) a £44 per share deal that values the former at £68 billion. Wednesday brought a healthy jobs report with the unemployment rate dropping to a 7 year low of 5.4%. This however did not prevent the FTSE continuing its early week fall as commodities continued their downward trend. Thursday was completely different as commodities rose and strong earnings from WH Smith and Unilever pushed the FTSE back up, this was compounded by weak US inflation figures easing fears of a US rate hike.
Looking forward to next week figures to be aware of include Public Sector Net Borrowing on Wednesday and retail sales on Thursday.
US
The Dow followed a similar path to the FTSE, with an average start to the week followed by a strong Thursday. The 0.2% fall in CPI inflation making a rate hike unlikely, combined with a new low in benefit claims led the rally. Throughout the week the banking sector released with Bank of America and Citi posting positive figures, JP Morgan and Goldman Sachs missing targets and Wells Fargo somewhere in the middle.
Next week earnings continue to dominate the agenda with Yahoo on Tuesday and Amazon and Alphabet Inc (Google) both on Thursday.
Stock of the week: Radius Health
Radius Health’s share price rose 0.72 percent on massive volume (3.8 million shares, versus the 1.1 million average) this Thursday. The surge seemed to have been triggered by rumours about a possible takeover by Shire PLC with an offer of $90 a share. The rumours suggest if Shire’s $30 billion move for Baxalta falls through then it will make its move. Shire’s board has become increasingly pro-active since a bid from AbbVie last year, buying the specialty drug firm US Pharma as they look to prevent another bid.
Earlier in the week, Radius announced positive Phase 3 data from the ACTIVExtend trial, with women who were previously treated with 18 months of abaloparatide subcutaneous injection experienced no new vertebral fractures and an increased bone mineral density during first six months of treatment on alendronate. Despite this positive news the stock fell early in the week, trading at 4624 on Wednesday afternoon before closing at 6537.5 on Thursday.
Open (Monday)
6403.2
Close (Thurs)
6402.2
Change
-0.0156%
High
6413.8
Low
6256.5
Open (Monday)
17053
Close (Thursday)
17181.5
Change
0.754%
High
17194
Low
16889.5
Open (Monday)
1.53177
Close (Thursday)
1.54762
Change
1.035%
High
1.5509
Low
1.52002
Open (Monday)
1154.8
Close (Thursday)
1182.1
Change
2.364%
High
1191.4
Low
1151.4
Chart Source: IT-Finance 16/10/15
Economic Diary, 19th to 23rd October 2015
Monday 19th October
3.00am – CNY GDP q/y
3.00am – CNY Industrial Production y/y
3.00am – CNY Fixed Asset Investment ytd/y
11.00am – EUR German Buba Monthly Report
5.00pm – USD FOMC Member Lacker Speaks
Tuesday 20th October
7.00am – EUR German PPI m/m
9.00am – EUR Current Account
1.30pm – USD Building Permits
1.30pm – USD Housing Starts
Wednesday 21st October
9.30am – GBP Public Sector Net Borrowing
3.30pm – USD Crude Oil Inventories
Thursday 22nd October
9.30am – GBP Retail Sales m/m
1.30pm – EUR ECB Press Conference
1.30pm – USD Unemployment Claims
2.00pm – USD HPI m/m
3.00pm – EUR Consumer Confidence
3.00pm – EUR Existing Home Sales
Friday 23rd October
8.00am – EUR French Flash Manufacturing PMI
8.00am – EUR French Flash Services PMI
8.00am – EUR Spanish Unemployment Rate
8.30am – EUR German Flash Manufacturing PMI
8.30am – EUR German Flash Services PMI
9.00am – EUR Flash Manufacturing PMI
9.00am – EUR Flash Services PMI
2.45pm – USD Flash Manufacturing PMI
Earnings releases, 19th to 23rd October 2015
Monday 19th October
Halliburton Co – Q3 2015 Earnings Release
Morgan Stanley – Q3 2015 Earnings Release
Tuesday 20th October
ASOS PLC – Full Year 2015 Earnings Release
Whitbread PLC – Half Year 2015 Earnings Release
Chipotle Mexican Grill Inc – Q3 2015 Earnings Release
Yahoo Inc – Q3 2015 Earnings Release
Wednesday 21st October
Home Retail Group PLC – Half Year 2016 Earnings Release
Sky PLC – Q1 2015/16 Earnings Release
The Coca-Cola Co – Q3 2015 Earnings Release
eBay Inc – Q3 2015 Earnings Release
General Motors Inc – Q3 2015 Earnings Release
Thursday 22nd October
Debenhams PLC – Full Year 2015 Earnings Release
Mothercare PLC – Q2 2015 Trading Statement
3M Co – Q3 2015 Earnings Release
Alphabet Inc – Q3 2015 Earnings Release
Amazon.com Inc – Q3 2015 Earnings Release
McDonald’s Corp – Q3 2015 Earnings Release
Friday 23rd October
Shire PLC – Q3 2015 Earnings Release
TSB Banking Group PLC – Q3 2015 Earnings Release
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