May I have this dance?

May I have this dance?

Equities have made a positive start to the week, albeit now off their best levels. Following Friday’s rout, investors are once again doing their best to digest the latest US-China war of words as merely another round in what is fast becoming a dance of egos, from which neither side has any real interest in hurting trade and/or financial markets. Germany’s DAX outperforms thanks to EUR weakness. M&A flow (Novartis, Shire, Rolls Royce) continuing to buoy sentiment.

FTSE 100 higher thanks to outsized contributions from HSBC (Asia investor and analyst presentations), RIO (UBS highlighting cash returns), GSK (break above 200-day MA) and DGE which are overpowering the hindrance from BP (GBP strength), GLEN/AAL (UBS prefers BHP and RIO over GLEN and AAL; Liberum says copper market back in surplus in 2019), EVR (sanctions read-across) and BHP (Credit Suisse highlights rising US steel capacity, loser in US-China trade war).

The FTSE 100 has turned back from 7215. The DAX 30 has broken above 12300. Dow Jones Futures have lost momentum at 24175. Gold is trapped 1320-1335, by USD strength and a lack of panic/safehaven demand.”

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