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Investment market update

Early Trading

UK stocks are expected to open flat today, with the focus on manufacturing and services Purchasing Manager’s Index readings from Germany and France in the morning and the same from the US in the afternoon.

World Markets

Asian stocks swung between gains and losses as Japanese shares fell as the yen advanced, offsetting gains in Chinese and Taiwanese shares. Shares in Japan Tobacco fell by 1.4% as the world’s largest insurer, Axa, announced it would stop investing in the tobacco industry.

US stocks rose, with the S&P 500 rebounding from a seven-week low, led by a rally in technology shares amid fading anxiety over the potential for higher interest rates as early as next month. Applied Materials Inc. surged 14% after forecasting sales beat analysts’ estimates, spurring gains among tech companies. Apple Inc. increased 1.1% to its first weekly advance in five.

UK stocks rose more than 1%, recovering most of the ground lost on Thursday. Rising prices of metals lifted mining shares, and Anglo American climbed 3.6%. The biggest riser on the index was Coca-Cola HBC, which was 6.5% higher after Citigroup upgraded its rating on the stock to ‘buy’.

Headlines

The Greek parliament has passed new budget cuts and tax rises two days before a Eurozone meeting expected to unblock much-needed bailout funds. The government led by the leftist Syriza coalition passed the widely unpopular bill by 153 votes to 145. Greece agreed to a third bailout worth £67bn last year.

Oil has rebounded about 80% to almost $50 a barrel from the 12-year low reached in January as low prices take their toll on supplies from the US to Nigeria. The International Energy Agency and Goldman Sachs Group Inc. say the crude surplus is dissipating, signalling that the Saudi approach – opposed by most OPEC members when it was unveiled in late 2014 – is finally paying off.

German drugs and chemicals company Bayer has made a £43bn offer for Monsanto, in a deal that would create the world’s biggest agricultural supplier. Both companies confirmed last week that Bayer had launched an offer for the US seeds giant.

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