Get 40% Off
🤯 This Tech Portfolio is up 29% YTD! Join Now to Get April’s Top PicksGet The Picks – Just 99 USD

U.S.-China Trade Ceasefire Prompts Equity Rally

Published 30/08/2019, 12:20
Updated 09/07/2023, 11:32

The cooling of trade tensions between the US and China has helped equity markets for a second day. Beijing have made it clear they will not retaliate in the trade dispute, and even though the situation is still tense, traders are taking the opportunity to stagger into no man’s land and pick up stocks. In recent months there has been a lot of too-and-froing between the Beijing and Washington DC, but things have simmered down in the past 24 hours, and some dealers have stepped into the fold. As long as the trading relationship doesn’t deteriorate any further, we could see a positive finish for the week.

Grafton Group (LON:GFTU_u) are firing on all cylinders as its operations in Ireland, the Netherlands, and the UK are all performing well. First-half operating profit and revenue increased by 6% and 2% respectively. The Irish unit saw ‘good growth’ and its outlook is ‘positive’. Home improvements in Ireland and the UK are helping the company. Despite the uncertainty in relation to Brexit, Selco - UK business, is in good shape.

Premier Foods (LON:PFD) confirmed that Alex Whitehouse, the UK managing director, has been appointed as the CEO, Reckitt Benckiser's (LON:RB) previous finance director, Colin Day, has been named as non-executive chairman. Duncan Leggett will act as CFO pending a permanent appointment. The shakeup to management comes as Gavin Darby, the previous CEO, left the group earlier this year. The share price has plodded along in recent years, and today’s announcement has the potential to be turning point for the group, but the new management need to map out a turnaround plan in order to restore investor confidence.

GBP/USD is slightly lower as the fear of a no-deal Brexit hangs over the pound. UK mortgage lending surged to £4.6 billion in July, which topped the £3.7 billion forecast, and the number of mortgage approvals exceeded forecasts too. Despite all the chatter about Brexit, the mortgage market is clearly robust.

EUR/USD is in the red on the back of the firmer US dollar, and the mediocre eurozone CPI data hit the currency pair too. CPI in the euro area held steady at 1%, meeting forecasts, and the core reading remained at 0.9%. The low readings suggest that demand is soft, and that might increase calls for looser monetary policy from the ECB next month.

Dell Technologies (NYSE:DELL) will be in play today after the group posted their second-quarter earnings last night. The group revealed impressive numbers as EPS were $2.15, which smash the $1.47 forecast. Revenue was $23.45 billion, while the consensus estimate was $23.27 billion. The PC division registered a 6% increase in revenue, and the commercial operation saw a 12% rise in revenue. The company is more geared to the commercial side of business so it encouraging to see it is performing well in a core business.

We are expecting the Dow Jones to open 148 points higher at 26,520 and we are calling the S&P 500 up 17 point at 2,941.

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.

Original Post

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.