It’s been a fairly muted start to the new trading week with both the FTSE 100 and the pound little changed from last week’s closing levels.
Politics comes back into focus
Last week saw a batch of economic data released from the UK which on the whole could be summarised as solid but not spectacular leading to the FTSE 100 extending the gains seen at the end of 2017 while the pound remained subdued and within its recent range. Looking ahead, the coming days are fairly quiet on the data front and as such there’s a good chance that attention shifts away from economic and back towards politics once more. Theresa May is expected to announce a change to her cabinet line-up later today in what is likely to be the biggest ministerial reshuffle since last year’s botched election.
The PM’s stock has risen in recent months following her success in concluding the first phase of Brexit negotiations last month but her position remains precarious and any misstep could see the vultures begin to circle once more. Heavyweights such as chancellor Philip Hammond, foreign secretary Boris Johnson, home secretary Amber Rudd and Brexit secretary David Davis are all expected to remain in their posts but a replacement for the disgraced Damian Green, May’s de facto deputy who was asked to resign in December, could be one of the main roles to keep an eye on.
FTSE ekes out new record high
UK stocks have begun today’s trade in a fairly quiet fashion after ending last week at a record all-time high. The benchmark has just about managed to take out the previous high in early trade and in doing so make a new record intraday peak of 7733. The financials are amongst the best performing stocks with Standard Life (LON:SLA) Aberdeen higher by more than a percent whilst Standard Chartered (LON:STAN), Barclays (LON:BARC) and RBS (LON:RBS) are not far behind. At the other end of the index is Micro Focus International (LON:MCRO) which has seen its stock price plummet by more than 15% on the day following the announcement of a disappointing set of results.
The trading update was the first since the takeover of Hewlett Packard Enterprise’s software assets and poor performance in this area has contributed to the overall miss on analyst expectations. The software firm has announced a new CFO, Chris Kennedy, following the earnings release but the market reaction is clearly negative with today’s decline practically wiping out all the impressive gains seen in the past 6 months.