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Investment market update

Early Trading

UK stocks are set to open higher this morning after a Bank inspired rise yesterday. Bank shares reacted to Bank of England Governor Mark Carney’s comment that there was no new wave of capital regulation on the way.

World Markets

Asian stock markets were mixed on Wednesday despite getting a strong lead from Wall Street as the markets took a break from the previous session’s rally. Australian shares were lower despite third quarter growth figures coming in above expectations on rising exports. The economy grew 2.5% in the three months to September from a year ago, compared with 1.9%.

US stocks closed higher boosted by news that the first weekend of the holiday shopping season was better than first thought. Retailer shares were down early in the week after news of lacklustre Black Friday sales, but rebounded on strong sales from Cyber Monday. Shares in Amazon rose 2.2%, while department store Macy’s saw a 0.6% rise.

UK stocks rose with banks being the biggest gainers after they passed the latest stress tests, with Lloyds Banking Group and Barclays closing with gains of more than 3%. A Bank of England report found that none of the UK seven biggest banks needed to come up with a new capital-strengthening plan.

Headlines

Oil resumed its drop as the Organization of Petroleum Exporting Countries (OPEC) ministers prepared for a policy meeting at which the group is forecast to refrain from cutting output. Crude is dropping as OPEC looks past a global glut to pump above its production target in an effort to defend market share. While Saudi Arabia, OPEC’s biggest producer, has pledged to listen to other members when they gather in Vienna this week, the group has shown few signs of trimming output even as prices tumble.

The International Monetary Fund said currencies beyond the dollar, euro, pound and yen may meet the same key threshold as the Chinese yuan did to qualify for inclusion in the lender’s basket of reserve currencies. The IMF’s executive board this week approved the inclusion of the yuan in the fund’s Special Drawing Rights basket, alongside the currencies of the US, euro area, the UK and Japan. The change will take effect from 1 October 2016.

Facebook’s Mark Zuckerberg and his wife Priscilla Chan say they will give away 99% of their shares in the company to good causes as they announce the birth of their daughter Max. He said they are donating their fortune to the Chan Zuckerberg Initiative because they want to make the world a better place for Max to grow up in.

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