FTSE 100 logs ninth consecutive record closing high – Binary Options Daily Review

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Wednesday 11th January 2017
Prepared by Barry Jenkins, MarketsWorld Binary Options Analyst

 
Market Index Closing Level Move on day Intraday Market Range
CAC 4,888.23 + 0.66 4,868.50 – 4,906.15
DAX 11,583.30 + 19.31 11,545.00 – 11,607.00
Dow Jones 19,855.53 – 31.85 19,836.00 – 19,957.10
FTSE 7,275.47 + 37.70 7,237.29 – 7,284.81
IBEX 9,452.00 – 40.80 9,425.00 – 9,497.30

Closing Markets Summary

Dow Jones

Stocks in the US ended mixed on Tuesday with the Nasdaq closing at a record high for the fourth time in a row, while the Dow Jones closed lower, backing further away from the 20,000 level and the S&P 500 finished unchanged. Trading was slow with no real direction as investors waited for Trumps first press conference since being elected which could add some clarity to his legislative agenda, investors were also waiting for earnings season to get into full swing to back up stock valuations following the recent rally in US stocks. In economic news the National Federation of Independent Business said its optimism index jumped 7.4 points to 105.8, the strongest reading since 2004. November job openings rose as did the number of people quitting jobs while wholesale inventories for November jumped 1%. Companies that featured included Valeant Pharmaceuticals International Inc. which rose 6.8% after announcing a couple of deals late on Monday. General Motors Co. rose 3.7% after the car maker forecast a 2017 outlook above market forecasts. Ascena Retail Group Inc. sunk 10% after the company warned that it will report a wider than forecast loss after disappointing holiday sales led to increased promotions. Alphabet Inc.’s Google is reported to be in talks to sell its satellite business Terra Bella to startup rival Planet Labs Inc. Yahoo Inc. rose 2.3% after plans were disclosed Monday afternoon in which Chief Executive Officer Marissa Mayer and co-founder David Filo resigned from the board of directors. Shares of Williams Cos. Fell almost 11% after the natural gas infrastructure company said its stock offering priced at a deep discount and that it would increase its stake in Williams Partners L.P. The Dow Jones closed down 31.85 points at 19,855.53, the Nasdaq Composite closed up 20 points at 5,551.82 and The S&P 500 closed unchanged at 2,268.90.

Europe

European equity markets closed higher on Tuesday for the first time in two sessions shaking off nagging worries over the health of Italy’s banking system. The Pan-European Stoxx Europe 600 index closed up 0.1% at 364.07. A recovery in bank shares helped to focus a mini turnaround for the European benchmark as shares in lenders cut losses or turned slightly positive late in the session. The Stoxx Europe 600 Banks index managed to pare steeper losses to close off 0.1%. Late Monday, Italian lenders Popolare di Vicenza and Veneto Banca proposed a settlement deal with shareholders that could cost them more than €600 million. The deal would eat into their capital buffers, which could push them to ask for a state bailout. Economic data showed that French industrial production rebounded sharply in November rising 2.2%, after two months of contraction. Companies that featured included Italian banks Intesa Sanpaolo SpA which closed off its lows and Unione di Banche Italiane SpA which closed down 1.3%. UniCredit SpA ended with a modest gain after reversing course from earlier in the day. The FTSE Italia All-Share Banks Sector Index finished little-changed, after seeing firm losses early in the session. Lanxess AG moved lower after UBS cut the German chemicals major to neutral from buy. L’Oréal SA moved lower after Valeant Pharmaceuticals International Inc. agreed to sell three skin care brands including CeraVe to the French cosmetics giant for $1.3 billion. On regional markets the CAC closed up 0.66 of a point at 4,888.23, the DAX closed up 19.31 points at 11,583.30 and the IBEX closed down 40.80 points at 9,452.00.

FTSE

The FTSE closed higher on Tuesday to log its ninth consecutive record high, boosted by a rally in supermarket and mining stocks. Sterling recovered from earlier falls against the Dollar, rising 0.11% to $1.2176, but continued to decline against the euro, down 0.10% to €1.1493. Supermarkets had a positive session after an upbeat fourth quarter trading statement from Morrisons and after data from Kantar showed the sector enjoyed record sales over the Christmas period. Economic data from BRC showed that UK retail sales picked up in December as retailers began to pass on higher import prices to consumers. Strong food sales made up for sluggish non-food performance, the BRC and KPMG revealed that sales grew 1.0% in December compared to the same month the year before, with total sales values rising 1.7% year-on-year. The BRC’s measure of inflation, the shop price index, showed a year-over-year increase to -1.4% in December from -1.7% in November, its highest rate since August 2015. Companies that featured included Morrisons who released an upbeat fourth quarter trading statement and said it now expects full-year profits to be ahead of market forecasts following one of its strongest festive performances for seven years. Mining stocks including Anglo American, Rio Tinto, BHP Billiton and Fresnillo, were higher on the day, bolstered by encouraging Chinese data on producer prices. China’s producer prices were up 5.5% from the same month a year ago, ahead of forecasts for a 4.5% increase. Whitbread moved higher after Credit Suisse upgraded the stock to ‘outperform’. Insurers were the worst performers with shares in Prudential, Direct Line Insurance Group and Admiral Group in the red. The FTSE closed up 37.70 points at 7,275.47.

Economic News Expected Today

 USA

Type Period Forecast   Importance
MBA 30 Year Mortgage Rate Jan   4.39% Low
Crude Oil Inventories Jan 0.620M -7.051M High

Economic News Expected Today

EU  Eurozone

Type Period Forecast Previous Importance
Industrial Production (Spain) Nov 1.0% y/y 0.5% y/y Low

Economic News Expected Today

UK United Kingdom

Type Period Forecast Previous Importance
Industrial Production Nov 0.8% m/m; 0.6% y/y -1.3% m/m; -1.1% y/y Medium
Manufacturing Production Nov 0.5% m/m; 0.4% y/y -0.9% m/m; -0.4% y/y High
Construction Output Nov 0.3% m/m; 2.0% y/y -0.6% m/m; 0.7% y/y Low
Trade Balance Nov -£11.20bln -£9.71bln Medium
Trade Balance Non-EU Nov -£3.00bln -£1.60bln Medium
NIESR GDP Estimate Jan 0.5% 0.4% Medium

Other Global Economic Data Expected

 

Type Period Forecast Previous Importance
Leading Index (Japan) Jan 102.6 100.8 Low

Economic News Round Up MarketsWorld Bars

US wholesale inventories rose more than forecast in the last quarter, the US Census Bureau reported that US Wholesale Inventories rose to a seasonally adjusted annual rate of 1.0%, from 0.9% in the previous quarter. US Wholesale Inventories were forecast to rise 0.9% in the last quarter. The number of job openings in the US rose less than forecast in November, In the release of the monthly Job Openings and Labor Turnover Survey (JOLTS), the US Labor Department reported that the number of job openings, excluding the farming industry, increased to 5.522 million in November from 5.451 million a month earlier, which was revised from the original reading of 5.534 million. Forecasts were for the number of job openings to rise to 5.555 million. The National Federation of Independent Business index of small business optimism in the US rose more-than forecast in the last quarter, the National Federation of Independent Business reported that NFIB Small Business Optimism rose to a seasonally adjusted annual rate of 105.8, from 98.4 in the previous quarter. NFIB Small Business Optimism was forecast to rise 99.6 in the last quarter.

French industrial output rose more than forecast last month, INSEE reported that French Industrial Production rose to 2.2%, from -0.1% in the previous month whose figure was revised up from -0.2%. French industrial production was forecast to rise 0.6% last month.

The rate of unemployment in Switzerland remained unchanged last month, the State Secretariat for Economic Affairs reported that Switzerland’s unemployment rate remained unchanged at a seasonally adjusted 3.3%, from 3.3% in the previous month. Switzerland’s unemployment rate was forecast to remain unchanged at 3.3% last month.

Canadian housing starts rose more than forecast last month, the Canadian Mortgage and Housing Corporation report that Canadian housing starts rose to a seasonally adjusted annual rate of 207.0K, from 187.0K in the previous month whose figure was revised up from 184.0K. Canadian housing starts were forecast to rise to 195.0K last month. The number of building permits issued in Canada fell more than forecast last month, Statistics Canada reported that Canadian building permits fell to a seasonally adjusted annual rate of -0.1%, from 10.5% in the previous month whose figure was revised up from 8.7%. Canadian building permits were forecast to fall to 2.4% last month.

Consumer price inflation in China fell last month, the National Bureau of Statistics of China reported that Chinese CPI fell to an annual rate of 2.1%, from 2.3% in the previous month. Chinese CPI was forecast to remain unchanged at 2.3% last month. Chinese PPI rose to an annual rate of 5.5%, from 3.3% in the previous month. Chinese PPI was forecast to rise to 4.5% last month.

Retail sales in Australia rose less than forecast last month, the Australian Bureau of Statistics reported that Australian retail sales rose to a seasonally adjusted 0.2%, from 0.5% in the previous month. Australian retail sales were forecast to rise 0.4% last month.

Household confidence in Japan rose more than forecast last month, the Cabinet Office reported that Japanese household confidence rose to a seasonally adjusted annual rate of 43.1, from 40.9 in the previous month. Japanese household confidence was forecast to rise 41.3 last month.

 
Forex Round Up MarketsWorld Bars

The Dollar was slightly lower against of the other major currencies on Tuesday and sterling was trading close to two-month lows as investors continued to worry over Brexit. GBP/USD touched lows of $1.2106 early in the day but recovered with the GBP/USD up 0.10% at $1.2172. Sterling was on track for its worst three day run since October after British Prime Minister Theresa May said Sunday that the country would not be keeping “bits” of European Union membership. The remarks were seen as an indication that the UK won’t try to negotiate continued full access to the European single market when it leaves the EU. The Pound hit two-month lows against the Euro, with EUR/USD rising as high as $0.8763, before pulling back to $0.8685.

The Euro was firmer against the Dollar with the EUR/USD up 0.17% at $1.0593. The Dollar was weaker against the Yen, with USD/JPY down 0.58% to ¥115.33. The AUD/USD was up 0.38% at $0.7383. The USD/CAD was down 0.17% at $1.3197. The US Dollar Index was down 0.24% at 101.68, off an intra-day low of 101.48.

 
Commodity Round Up MarketsWorld Bars

Gold prices were slightly higher on Tuesday and hitting a six-week high earlier in the session. An overnight dip in prices turned into a buying opportunity for bargain hunters. Reports out said that demand for physical gold from China is increasing ahead of the Chinese lunar new year. There has also been a pick-up in demand for gold-backed exchange-traded-funds early in 2017. February gold was up $0.70 per ounce at $1,185.60. March silver was up $0.192 at $16.875 per ounce.

Crude oil futures fell sharply for a second session in a row with prices registering their lowest settlement in over a month as concerns grew over the potential for rising crude output despite the recent agreement to cut production. February West Texas Intermediate fell $1.14 to settle at $50.82 per barrel. March Brent crude fell £0.55 to settle at $54.39 per barrel.

The MarketsWorld Overview MarketsWorld Bars

Manufacturing production is the main piece of economic data in the U.K this week, the indicator declined 0.9% in October, the reading was well short of the forecasts for a reading of +0.2%. The markets are expecting a strong turnaround in the November release, with forecast for a reading of 0.5%. Monitor the Pound for Binary Options trading.

 

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The information contained in this publication is not intended as an offer or solicitation for the purchase or sale of any financial instrument. Any opinion offered herein reflects Barry Jenkins’ (MarketsWorld Analyst) current judgment and may change without notice. Users acknowledge and agree to the fact that, by its very nature, any investment in shares, stock options and similar and assimilated products is characterized by a certain degree of uncertainty and that, consequently, any investment of this nature involves risks for which the user is solely responsible and liable. This message is intended for recipient only and not for further distribution without the consent of MarketsWorld.

 
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Written by Barry Jenkins

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