Weekly Trading Update
27.11.15 Friday Morning
UK
Whilst relatively light on data, with a 9 month low CBI realized sales figure and an unchanged Q3 GDP second estimate, the UK was still the source of the biggest economic event this week. Wednesday’s Autumn Statement contained a surprise set of upwardly revised forecasts from the OBR and, most relevant stock-wise, a doubled housing budget and the promise of 400,000 new affordable homes. This lifted the housing sector as a whole, helping the FTSE, alongside some commodity-inspired gains on Thursday, to graze the 6400 mark. Not that those pesky commodity stocks were always the index’s friend, causing a growth-denying drag on Monday, Tuesday and Friday.
Next week will be a lot busier for the FTSE from a purely data-perspective, with net lending to individuals on Monday, the manufacturing PMI and Bank of England financial stability report on Tuesday, the construction PMI on Wednesday and the services PMI on Thursday. There is also the release of China’s manufacturing and services figures, something that could have a commodity-driven impact on the UK index dependant on the state of the data.
Eurozone
The Eurozone was arguably overshadowed by its UK and US peers this week; however, this didn’t stop the DAX from posting some huge gains, hitting a fresh 15 week high on Thursday (and crossing the 11300 mark for the first time since August 12th in the process) following increased talk over what kind of white rabbit Mario Draghi might pull out of his ECB hat next week. Not that it was all good news for the Eurozone; whilst the flash manufacturing and services PMIs for the region looked solid as a whole (barring an understandable dip in the latter for France), Germany’s Q3 GDP figure, coming in at 0.3%, saw 0.4% lopped off of due to the growing discrepancy between the country’s imports and exports.
Next week could be a big one for the Eurozone; more manufacturing and services data, the region-wide unemployment rate and inflation data, and German factory orders are all the side attractions to Thursday’s main event, the latest ECB meeting. As mentioned analysts are increasingly expecting some decisive action from Draghi, so there is either going to be jubilation or disappointment on the cards for the DAX and co.
US
With closed, or shortened, trading on Thursday and Friday the US had to pack a lot into the first half of the week. Monday saw a 25 month low manufacturing PMI before Tuesday brought with it a stronger than forecast annualised Q3 GDP figure (at 2.1% vs the 1.5% initial estimate) , an unexpectedly reduced goods trade deficit and a sharp drop in consumer confidence.
Wednesday then saw the US chuck everything it had at investors behind the Thanksgiving break, revealing a month low jobless claims figure, a 3 month high for core durable goods orders and a 7 month peak for the flash services PMI countered by the worst core PCE price index figure since December last year, a stagnant personal spending number, a disappointing (un)revised UoM consumer sentiment figure and a lower than forecast new home sales figure. All in all the Dow Jones had trouble properly reacting to this deluge of data, largely spending the week dancing either side of the 17800 mark.
If this week, despite all its data, was relatively inessential for the US, then next week couldn’t be any more important. The Chicago PMI on Monday, the Markit and ISM manufacturing PMIs on Tuesday, a speech from Janet Yellen on Wednesday and the latest services PMIs on Thursday all lead up to a mega-Friday which sees the release of the final non-farm jobs report before December’s FOMC meeting. Given how strong November’s data was, and the increasing certainty that the fed is ready for lift-off, there could well be fireworks with a similarly spectacular release next week.
Stock of the week: Thomas Cook Group PLC
Despite being in a sector troubled by issues well out of its control, Thomas Cook managed to eke out its first full year profit since 2010 on Wednesday, jumping from a £115 million loss to a £19 million positive following a 1.1% increase in group revenue to £7.83 billion. Combine this with a confident statement about its future, one that acknowledged the ‘fragile’ geo-political landscape but affirmed that growth hadn’t been drastically impacted, and the company climbed 17% across the final 3 days of the week.
Open (Monday)
6312.4
Close (Thursday)
6382.9
Change
+1.12%
High
6400.8
Low
6219.9
Open (Monday)
17857.6
Close (Thursday)
17873.5
Change
+0.09%
High
17898.5
Low
17655.6
Open (Monday)
1.51856
Close (Thursday)
1.506
Change
-0.83%
High
1.5198
Low
1.51092
Open (Monday)
1076.2
Close (Thursday)
1070.8
Change
-0.5%
High
1080.4
Low
1065.4
(Source: IT-Finance.com 27/11/2015)
Economic Diary, 30th November to 4th December 2015
Monday 30th November
9.30am – GBP Net Lending to Individuals m/m
10.00am – EUR Italian Prelim CPI m/m
2.45pm – USD Chicago PMI
3.00pm – USD Pending Home Sales m/m
Tuesday 1st December
1.00am – CNY Manufacturing PMI
1.00am – CNY Non-Manufacturing PMI
1.45am – CNY Caixin Manufacturing PMI
1.45pm – CNY Caixin Services PMI
8.15am – EUR Spanish Manufacturing PMI
8.45am – EUR Italian Manufacturing PMI
8.50am – EUR French Final Manufacturing PMI
8.55am – EUR German Final Manufacturing PMI
8.55am – EUR German Unemployment Change
9.00am – EUR Final Manufacturing PMI
9.30am – GBP Manufacturing PMI
10.00am – EUR Unemployment Rate
10.30am – GBP BoE Financial Stability Report
2.45pm – USD Final Manufacturing PMI
3.00pm – USD ISM Manufacturing PMI
Wednesday 2nd December
7.00am – EUR German Retail Sales m/m
8.00am – EUR Spanish Unemployment Change
9.30am – GBP Construction PMI
10.00am – EUR CPI Flash Estimate y/y
10.00am – EUR Core CPI Flash Estimate y/y
1.15pm – USD ADP Non-Farm Employment Change
1.30pm – USD Revised Non-Farm Productivity q/q
3.30pm – USD Crude Oil Inventories
4.00pm – USD Fed Chair Yellen Speaks
Thursday 3rd December
8.15am – EUR Spanish Services PMI
8.45am – EUR Italian Services PMI
8.50am – EUR French Final Services PMI
8.55am – EUR German Final Services PMI
9.00am – EUR Final Services PMI
9.30am – GBP Services PMI
12.45pm – EUR Minimum Bid Rate
1.30pm – EUR ECB Press Conference
1.30pm – USD Unemployment Claims
2.45pm – USD Final Services PMI
3.00pm – USD ISM Non-Manufacturing PMI
3.00pm – USD Factory Orders m/m
Friday 4th December
All Day – OPEC Meetings
7.00am – EUR German Factory Orders m/m
9.10am – EUR Retail PMI
1.30pm – USD Average Hourly Earnings m/m
1.30pm – USD Non-Farm Employment Change
1.30pm – USD Trade Balance
1.30pm – USD Unemployment Rate
Earnings releases, 30th November to 4th December 2015
Monday 30th November
Aberdeen Asset Management PLC – Full Year 2015 Earnings Release
Cranswick PLC – Half Year 2015 Earnings Release
Tuesday 1st December
ITE Group PLC – Full Year 2015 Preliminary Results Announcement
Topps Tiles PLC – Full Year 2015 Earnings Release
Wednesday 2nd December
Greene King PLC – Interim Results Announcement
Zoopla Property Group PLC – Full Year 2015 Earnings Release
Telford Homes PLC – Interim Half Year Results Announcement
Thursday 3rd December
GW Pharmaceuticals PLC – Full Year 2015 Earnings Release
DS Smith PLC – Half Year 2016 Earnings Release
Friday 4th December
Berkeley Group Holdings PLCIt's easy to open an account
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