CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 69% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.
Open account
☰
CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 69% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.
Open account
✖

Weak earnings a drag on FTSE

Article By: ,  Senior Market Analyst
January 30, 2020 4:50 AM

UK corporate earnings are not painting a pretty picture this morning, coming at a time when the spread of the coronavirus is already eroding the outlook for some companies. The FTSE is trading down almost 0.6% but home builders and utilities are providing some counterbalance.

BT is the most heavily sold stock after the telecoms firm reported a drop in third quarter revenue and warned that limiting the role of Huawei in Britain’s 5G expansion will increase the cost of its own gigabit plans by £500m .

Shell blamed a drop in the oil price in the last quarter on a 23% decline in its earnings and a far deeper plunge in net profits. Investors sold off the share in sync with rival BP in anticipation of a similar set of results from BP next Tuesday.

In a more normal situation in the markets BP would have been granted a little bit of respite given that oil prices have risen since the current reporting period, during the inflamed Iran-US tensions in early January. However, now that the coronavirus seems to have got its hooks into parts of China, the outlook for oil prices is beginning to deteriorate. Brent crude has dropped below the $58 mark and is unlikely to show any signs of recovery until China is free of the virus and back to being fully operational.

Pound slides ahead of BoE decision

The Bank of England is back in session today and for once the outcome is less than a given. In the lead up to this rate setting meeting four of the nine members indicated that it may be time to cut rates to help revive the UK’s slowing economy, but since then the UK’s economic indicators have started improving slightly, particularly in the housing market. The “what happens after Brexit” remains the big unknown and although investors seem to have less immediate concerns it is still not clear how Brexit  will play out for businesses over time. The pound is a touch lower against the dollar and losing more ground versus the euro.  

StoneX Financial Ltd (trading as “City Index”) is an execution-only service provider. This material, whether or not it states any opinions, is for general information purposes only and it does not take into account your personal circumstances or objectives. This material has been prepared using the thoughts and opinions of the author and these may change. However, City Index does not plan to provide further updates to any material once published and it is not under any obligation to keep this material up to date. This material is short term in nature and may only relate to facts and circumstances existing at a specific time or day. Nothing in this material is (or should be considered to be) financial, investment, legal, tax or other advice and no reliance should be placed on it.

No opinion given in this material constitutes a recommendation by City Index or the author that any particular investment, security, transaction or investment strategy is suitable for any specific person. The material has not been prepared in accordance with legal requirements designed to promote the independence of investment research. Although City Index is not specifically prevented from dealing before providing this material, City Index does not seek to take advantage of the material prior to its dissemination. This material is not intended for distribution to, or use by, any person in any country or jurisdiction where such distribution or use would be contrary to local law or regulation.

For further details see our full non-independent research disclaimer and quarterly summary.

CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 69% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money. CFD and Forex Trading are leveraged products and your capital is at risk. They may not be suitable for everyone. Please ensure you fully understand the risks involved by reading our full risk warning.

City Index is a trading name of StoneX Financial Ltd. Head and Registered Office: 1st Floor, Moor House, 120 London Wall, London, EC2Y 5ET. StoneX Financial Ltd is a company registered in England and Wales, number: 05616586. Authorised and regulated by the Financial Conduct Authority. FCA Register Number: 446717.

City Index is a trademark of StoneX Financial Ltd.

The information on this website is not targeted at the general public of any particular country. It is not intended for distribution to residents in any country where such distribution or use would contravene any local law or regulatory requirement.

© City Index 2024