- FTSE 100 index up 64 points
- Sterling dip
- Wall Street opens with a wave
3:45 p.m .: Sterling turns red
Footsie cut its gains before the close, after a rally of almost 100 points following a dynamic American opening.
London’s leading index rose 64 points to 6,139 in the afternoon, while the British pound lost 0.17% to US $ 1.2578.
According to OANDA analysts, this rebound is not expected to last long, although the week ahead will come with stimulating central bank decisions.
Among them, the is expected to announce a £ 100 billion increase in its asset purchase target.
“The liquidation of the stock markets is unlikely to be a one-off event as COVID-19 continues to escalate in the United States and is likely to disrupt plans to reopen in many states,” said Edward Moya of OANDA.
“Viral uncertainty could support an additional 5-10% in the coming weeks, but all efforts to revive global policy makers will prevent a complete collapse to return to the March lows.”
2:45 p.m .: Dow Jones opens with a jump of 700 points
The Footsie was on a late afternoon sprint as Wall Street leaped into the open.
London’s leading index rose 89 points to 6,165, the Dow Jones jumped 746 points to 25,874 and the S & P500 added 76 points to 3,078.
As expected, stocks recovered after Thursday’s big losses.
However, many states are reporting new coronavirus infections, with new case increases over 40% in Arizona, Utah and New Mexico.
Infections in Florida, Arkansas, South Carolina and North Carolina increased 30% last week, according to Reuters.
2 p.m .: UK will not extend the Brexit transition period
The Footsie was still up 70 points to 6,146 after lunch, but the British pound reduced its gains, now just above the flat line at US $ 1.2607.
Michael Gove officially ruled out a Brexit extension period with a statement on Twitter.
I just chaired a constructive meeting of the EU Joint Committee with @MarosSefcovic
I have officially confirmed that the UK will not extend the transition period and the time for extension is now past. On January 1, 2021, we will regain control and regain our political and economic independence pic.twitter.com/nZjNpez8LI
– Michael Gove (@michaelgove) June 12, 2020
The Times reported earlier today that full border controls with the EU would be eased after Brexit because they feared to worsen the economic damage caused by the pandemic.
The stocks were apparently out of phase as investors took advantage of the weak market after the rebound in the first weeks of June.
“A huge reason why Europe feels comfortable enough to post such gains is that the Dow Jones is aiming for a rebound of 600 points when the bell rings on Wall Street,” said analyst Connor Campbell.
“It is a sign of the magnitude of Thursday’s losses that such a surge would only recover a third of this drop. “
12:20 p.m .: Bounce in sight for US stocks
The Footsie ordered a few more items at lunchtime, rising from 77 to 6,154, stubbornly ignoring the British GDP contraction in April.
US stocks are also expected to rebound from yesterday’s dramatic losses – although the Dow Jones 6.9% is not even in the worst three days of the year, as some have pointed out.
The recovery expected today could surprisingly continue, as investors may not be discouraged by yesterday’s Fed forecasts or fears of a second wave of coronavirus infections.
” [It] might just be a case where these declines are slightly reduced, but these markets are very strange and I wouldn’t be surprised if it was seen more as a “buy the trough” opportunity, ”said Craig Erlam, analyst at OANDA.
“The forecast has not worried investors yet and we will have to see considerably larger peaks in the new cases for states to even consider tightening the lockdowns. It sounds more like an excuse to take profits in a market that has rebounded remarkably to the point that there is a huge disconnect between the stock markets and economic reality. “
11:40 am: Games Workshop higher while recovery exceeds expectations
The Footsie cut their earnings before lunch, pocketing 63 points to 6,140.
In the FTSE 250 index, () jumped 10% to 7,800.04 p after announcing a recovery trajectory that exceeded expectations, as more and more people like miniature war games.
The Warhammer owner now operates in its warehouses, while 306 of its 532 stores in 20 countries have reopened.
Sales for the year to March 31 are estimated to be around £ 270 million, while pre-tax profits will be “no less” than £ 85 million.
10:35 am: Carnival jumps on new trip cancellations
Footsie added 77 points to 6,153 late in the morning, while the pound rose 0.2% to $ 1.2626 US.
“The markets appear to have stabilized after yesterday’s crash in global stocks, with traders trying to determine whether it is finally the start of the second massive sale,” said Joshua Mahony, analyst at IG.
“We seem to be moving from a phase where everyone is looking towards reopening as a cause of optimism, to one where we are starting to focus on Covid case numbers with concern. The gains we are seeing today highlight the fact that a second wave is still far from guaranteed, but we are certainly likely to see market volatility and sensitivity accelerate in the coming weeks as business Covid will arrive. ”
() was again one of the best increases in the benchmark, jumping 10% to 1,303.68p after announcing a new round of cancellations.
Her Holland America Line arm extended the cruise break and canceled additional departures from the Canadian port of Vancouver this year and some trips to Hawaii in 2021.
Customers can choose between refunds or future cruise credits of 1125% of the value paid for the canceled trip.
9.50am: British Airways IAG owner, easyJet and Ryanair initiate legal action against quarantine rules
The Footsie went green by mid-morning, pocketing 40 points at 6,117.
Despite the disastrous British GDP figures for April released earlier this morning, markets have held up well.
“The FTSE 100, which is brimming with multinational companies, is not really a barometer for the British economy, but even the more country-oriented FTSE 250 has not suffered serious damage,” said director Russ Mold investments by AJ Bell.
“Investors are not stupid, they know that April was probably the height of the lockdown. The unprecedented nature of the fall in economic activity only reflects the unprecedented act of effectively shutting down a modern economy. ”
Passenger stocks increased after the owner of British Airways (), easyJet PLC () and Ryanair PLC () took legal action against the government’s quarantine rules.
The airlines have filed documents with the High Court to challenge the 14-day quarantine for incoming travelers, mandatory from June 8, which they say is defective and will have a devastating effect on the sector.
BA, easyJet, Ryanair say it is “more stringent than for people who actually have Covid-19” and “no scientific evidence provided for such a harsh policy”.
Priti Patel says he is “informed by science, supported by the public and will keep us all safe” .https: //t.co/bDrnNYwnaI
– @simoncalder (@SimonCalder) June 12, 2020
They proposed that Westminster revert to the policy implemented in March, according to which only passengers from high-risk countries are required to isolate themselves.
“It would be the most practical and effective solution, and would allow civil servants to focus on other more important problems arising from the pandemic while aligning the United Kingdom with a large part of Europe which is opening its borders in mid-June, “said the joint press release. Lily.
Shares in IAG and easyJet jumped 8% to 284.72p and 823p respectively, while Ryanair rose 3% to € 11.35.
8:45 am: Footsie licks his wounds
On Friday, the FTSE 100 began a silent but negative process, as traders absorbed the scale of the devastation caused by the coronavirus pandemic (COVID-19) on the British economy.
The British blue chip index opened 10 points lower at 6,066.24, although it crossed a three-digit plunge on Thursday.
Figures for April showed that the UK’s gross domestic product had fallen by more than a fifth as the UK locked out. Decline from January is over 25%, overshadowing the 6% decline from peak to trough observed during the credit crunch, which was previously the sharpest in post-war history
“The economy will take a long time to recover from the blows of the COVID-19 pandemic,” said Samuel Tombs, chief economist at Pantheon Macroeconomics.
US traders staggered home in need of a cold pack after the Dow Jones Industrial Average fell nearly 1,900 points overnight on Wall Street amidst turmoil in the national and global economies.
Fortunately, much of the bloodshed had already taken place on this side of the Atlantic, so the response to the worse-than-expected British GDP figure was a little more moderate than we could have expected. wait.
Precious metals stocks lost a lot of gains on the market on Thursday, with Mexican silver producer Fresnillo () leading the Footsie slaughterers by 2.6%.
Educational publisher Pearson () topped the rankings, up 8.6% after activist investor Cevian Capital was unmasked as a shareholder at 5.4%.
The Informa () event group increased 5.2% after revealing that trading was not as bad as expected.
Proactive news headlines:
The City Pub Group PLC () highlighted “significant new growth” in trade in its 2019 fiscal year, while updating its plans for the post-coronavirus environment. For the year ended December 29, 2019, the pub group reported Adjusted Underlying Profit (EBITDA) of £ 9.1m, up 15.4% year-on-year, while revenues jumped 31% to £ 60m. Like-for-like sales also increased 1.7% year-on-year compared to what the company called “a difficult comparable period” after the 2018 World Cup and summer heatwave.
() appointed a company specializing in geological modeling, Mira Geoscience, to help select drilling targets in the nickel / copper prospect for the Kalahari suture area (KSZ). Mira Geoscience is a recognized specialist in advanced 3D geological and geophysical modeling, the company noted, including interpreting mineral systems and identifying drill targets.
Ferro-Alloy Resources Limited () said it had raised US $ 300,000 through a bond issue on the Astana Stock Exchange in Kazakhstan, the group also announced that it had resumed production operations in the country. The vanadium miner said the investors had purchased 150 of its bonds with a face value of US $ 2,000 each. The bonds are unsecured with a term of three years and bear interest at 7.5%, paid twice a year. About 50 bonds have a maturity date of June 5, 2023, while the remaining 100 bonds have a maturity date of June 11, 2023. Meanwhile, the company said production of the hydrometallurgical process resumed on June 1 2020 and that it now has “significant output” from both its hydrometallurgical and pyrometallurgical processing routes.
Galantas Gold PLC () has announced a loss of C $ 3.56 million for 2019 as underground mining at the Northern Ireland-based miner continues to be hampered despite blasting restrictions. Police must supervise the underground blasting of the mine, using explosives, at the mine near Omagh, and the company was forced to shutdown during the fourth quarter due to insufficient level of blasting activity. He has subsequently worked with the authorities in Northern Ireland on the arrangements for resuming underground blasting and, following major investments, is still awaiting approval for increased blasting. Production continued using substandard equipment, until the coronavirus pandemic temporarily halted these operations as well, before resuming work in late May this year.
() told investors that it is looking positively at advancing value creation opportunities as it remains “well positioned” in the context of the challenges facing small-cap oil and gas companies in 2020., the company confirmed a stronger end of the year, with average net production of 2,505 barrels of oil equivalent per day (bpd) during the months of November and December. A review of reserves at the end of 2019 confirmed a reserve base of 3.8 million barrels of oil equivalent (boe). Operationally, the company successfully completed its seismic programs during the year, while on the corporate front, it successfully completed the restructuring of its portfolio.
() Said it extended its “market” sales agreement with US investment bank ThinkEquity until July 31. This facility allows the group to sell US deposit shares of up to US $ 20 million.
PLC () declared a first interim dividend of 4.67p per common share, payable on July 23, 2020 to holders registered in the register at the close of business on June 19, 2020. The group indicated that its board of directors expected that the second and third interim dividends will be maintained at this rate, and an unchanged final dividend of 6.00p will be offered for the year ending November 30, 2020, giving a dividend for the year of 20.01p, a slight increase compared to the previous year.
(), the listed oil and gas company AIM, which focuses on Africa, said its annual general meeting (AGA) will be held at 11:00 am on July 6, 2020, in Albany, London W1. Due to the ongoing coronavirus pandemic and the current ban on public gatherings, the AGM is called a “closed meeting” and members will not be allowed to attend, however shareholders are invited to watch or listen via Zoom using the details provided in the notice of meeting. The procedures relating to powers of attorney are also described in the notice of the AGM, available on the company’s website: www.towerresources.co.uk
7:00 am: Footise ready for a new sorrow
The FTSE 100 index is expected to decline on Friday, albeit less precipitously than Thursday’s plunge, after a continued decline in New York in Asia caused by concerns about the second wave of coronavirus (COVID-19) and after the unfavorable economic assessment of the US Federal Reserve on Wednesday.
The spread betting company CMC Markets expects the benchmark to open around 30 points lower at 6,046, after plunging 252.43 points, or 4% Thursday to 6,076.70, wiping out a whole recent optimistic rally.
Overnight in New York, the Dow Jones Industrials Average fell by 1869, or nearly 6.9%, to close at 25,128.17, while the broader S&P 500 index fell 5.9%, and the Nasdaq Composite in charge of technology lost 5.3%.
Today, although more modestly, the turmoil has continued in the Asian markets, with the Hong Kong Hang Seng index losing 0.9% and the Tokyo Nikkei 225 index currently 1.2%.
David Madden, market analyst at CMC Markets UK, commented: “Yesterday was like a flashback to the madness that was seen in the markets in February and March as fears of a possible second wave of Covid-19 generated intense sales.
“The sharp declines recorded yesterday must be seen in context with the major gains that have been accumulated in recent weeks.”
He added: “Recently, governments have taken steps to relax lock restrictions and this is one of the main reasons for the uptrend in stocks. As economies slowly reopened, economic activity increased. In general, manufacturing and services reports from countries around the world rebounded decently from April to May, so the new reopening of the economies gave traders hope that things would continue. improve.
“Reports from Texas and California, as well as a number of other US states, have shown that the recent relaxation of restrictions has resulted in an increase in the number of new COVID-19 cases, which has triggered a brutal wave of sales yesterday. ”
Madden concluded: “There is an argument to be made that the stocks needed to undergo a decent correction in light of the gains made in the past three months. On the other hand, savings cannot be locked in forever, so a jump in the infection rate will be costly to bring things back to normal. Decision makers will have a difficult task ahead of them as they try to balance health and economic risks. “
British GDP to be catastrophic
On the newspaper, the main economic data for the week in the UK is slated for Friday, when the latest figures for gross domestic product, industrial production and trade are expected from the Office of National Statistics, while the newspaper news of the business is fairly light.
British GDP in April is expected to have fallen by almost 19% from the previous month, after the 5.8% drop in March.
“Production in certain sectors – such as retail – was first supported by storage in March, before collapsing sharply in April,” said Pantheon Macroeconomics.
“In addition, many construction sites remained open at the end of March – the regulations never obliged them to close – before closing completely in April. And the collapse in manufacturing has likely gotten worse as time has passed, due to the shortage of components and the backlog of work exhausted. “
Important events expected on Friday:
Finals: (), ()
Trading update: PLC group ()
Economic data: British GDP, American Michigan consumer sentiment
Around the markets:
- Pound Sterling: US $ 1.2591, down 0.1%
- Gold: US $ 1,725 per ounce, up 0.4%
- Crude Brent: US $ 37.73 per barrel, down 0.2%
- fined £ 64 million by city watchdog for failing to treat mortgage clients fairly after they got into financial trouble – The Guardian
- Ocado sues Jonathan Faiman and his company Today Development Partners for alleged corporate spying – The Times
- WPP has appointed Angela Ahrendts, former Apple Retail Director and CEO of Burberry, to its board of directors – Financial Times
- More than a third of Morrisons investors rebelled against the supermarket’s compensation policy for its generous retirement benefits for senior executives – The Times
- In a significant political shift, the British government abandoned its plan to introduce full border controls with the EU on January 1 under pressure from companies not to aggravate the chaos caused by the coronavirus – Financial Times
- Some of the UK’s largest employers announced massive layoffs yesterday, with more than 8,000 jobs cut, in the latest economic blow – The Times
- Snap invites developers to create lite versions of their own apps on its Snapchat platform – Financial Times
- British metal magnate Sanjeev Gupta has launched a campaign to cut costs by 30% in his international steel, aluminum and energy empire – Financial Times
- European Union plans to file formal antitrust charges against Amazon for its treatment of third-party sellers – The Times
- Pradeep Parameswaran, former head of the Uber division in India and South Asia, has been appointed new Asia Pacific director – Financial Times
- Germany launches lifeboat in travel industry to protect customer deposits after thousands of vacationers have suffered losses following Thomas Cook collapse – The Daily Telegraph
- German airline bailed out Lufthansa to cut 22,000 jobs as airline struggles with collapsing demand – The Daily Telegraph
- Beer sales plummeted to 20-year low in first three months of the year as foreclosure forced UK 47,000 pubs to close – The Guardian