Stock markets are broadly lower today as traders are increasingly worried about the prospect of a trade war. Tensions between the US and China are escalating, and we are not any closer to an agreement being reached. With neither side willing to back down, investors are caught in the middle.
DS Smith (LON:SMDS) shares are in the red even though the company revealed respectable full-year figures. Revenue and adjusted profit before tax both jumped by 17%. The firm confirmed it ‘performed very strongly’ and is confident it will achieve all of its medium-term targets. Growth was partially driven by acquisitions, and rising paper prices, but it is worth noting that costs rose too. The final dividend was 9.8p, down from 10.6p. The share price has been in a solid upward trend since April, and if the bullish move continues it could target 600p.
CYBG PLC (LON:CYBGC) is set to acquire Virgin Money (LON:VM), and the deal is worth £1.7 billion. The group stated the deal will provide a ’broad-based, less concentrated combined mortgage and unsecured lending portfolio’. The two banks will pool resources and look to scale up their operations, and aim to draw business away from the big four banks Barclays (LON:BARC), HSBC (LON:HSBA), RBS (LON:RBS) and Lloyds (LON:LLOY). It will be difficult to win business from the major players, especially as the established high-street banks have bigger budgets to improve technology – which will be a crucial part in the industry’s future.
BP (LON:BP) and Royal Dutch Shell (LON:RDSa) shares are lower this morning as traders are concerned OPEC will decide to increase oil production later this week.
Premier Oil (LON:PMO) shares are in the red after Barclays cut it price target from 145p to 135p. The share price has retreated from its multi-year high in May, and if the pullback continues it could target 97.5p.
Tyson Foods (NYSE:TSN) and Dean Foods (NYSE:DF) could come under pressure today after China revealed a fresh round of tariffs on $34 billion worth of US goods. Beijing is targeting the agricultural sector and the car industry.
GBP/USD is down today as UK average house prices grew at a slower pace on a monthly basis. According to Rightmove, average asking prices for houses grew by 0.4% in June, compared with 0.8% growth in May.
We are expecting the Dow Jones to open down 115 points at 24,975 and we are calling the S&P 500 down 9 points at 2,770.
DISCLAIMER: CMC Markets is an execution only provider. The material (whether or not it states any opinions) is for general information purposes only, and does not take into account your personal circumstances or objectives. Nothing in this material is (or should be considered to be) financial, investment or other advice on which reliance should be placed.
No opinion given in the material constitutes a recommendation by CMC Markets or the author that any particular investment, security, transaction or investment strategy is suitable for any specific person.