Corporate updates overshadow escalating trade tensions

The FTSE rebounded on Friday, jumping over 1% across the course of Friday, regaining losses from the previous session; however, it was a case of too little too late and the FTSE remains on course for a loss across the week.

Mondi Benefits From Environmental Awareness
Mondi topped the FTSE gainer board, jumping over 7% on the back on some impressive earning. Mondi. The paper packaging specialist is benefiting from the global trend of replacing plastic packaging with durable paper products. Growing concerns over the impact of plastics on the environment has played right into the hands of Mondi, which has been steadily expanding through acquisitions, resulting in a 17% increase in earnings before interest, tax, depreciation and amortization.

RBS Returns To Dividends
RBS hit a major milestone on its path to privatisation, by announcing a revival of its dividend. This marks the first dividend by the bank since the financial crises and will go some way to helping the bank in its recovery and pave the way for a reduction of the government’s 62.4% stake. We could now expect to see the number of potential investors signing up to government share sales increase significantly, basically because fund managers are not permitted to invest in stocks that don’t pay a dividend. Today’s move is a game changer. RBS jumped over 2.5%.

US NFP Keeps Fed’s Plan In Tact
Stocks on Wall Street were relatively flat as investors digested the slightly weaker than forecast US jobs report. 157k jobs were created in July, significant below the 192k expected, however the previous two months were also revised higher which was viewed as a form of compensation for the markets. The average over the past three months was 224k, well above the trend.
The closely watched earnings aspect of the report printed as expected with wages increasing 0.3% on a monthly basis, equating to a 2.7% year on year increase. On the downside, wage growth was revised lower for the previous month to just 2.6%. So, despite the labour market continuing to tighten, significant wage growth remains elusive.
Still these figures by no means were significant enough for the Fed to adjust its current path to tightening. As a result, the market impact from the data has been minimal. The dollar is marginally lower versus a basket of currencies.

Trade Tensions Boost Yen
The USDJPY has seen the biggest move, down 0.47%. However, this is more to do with the escalating trade tensions, as Chins retaliates to Trump’s latest threats, in the clearest sing yet that this trade war is just getting started.

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