FTSE higher but Asian shares struggle

European shares are moving gingerly higher and the European currencies are gaining some ground against the dollar.

Focus is turning - back to company news and earnings and away from the Turkish lira, which has now stabilised against the dollar after the onslaught early this week. 

In Asia stock markets came under pressure after a Chinese technology giant reported a loss spreading contagion over other Asian tech stocks. The Shanghai market dropped a solid 1.9% at one point before recovering and closing down 0.8%. News that a Chinese delegation will travel to Washington in late August to try and find a resolution to the Sino-US trade dispute helped Asian stocks to bounce back. The last attempt to find some middle ground between the two countries took place in June in Beijing but didn’t yield an agreement. 

Kingfisher sales pick up in second quarter

Cold weather caused many British retailers to struggle with sales in the first part of the year but the unusually hot spell this summer may just make up for it. Sales of hosepipes, sprinklers and barbeque charcoal were the order of the day in May, June and July, helping Kingfisher, the owner of B&Q and Screwfix, to increase sales by 1.6% during this period. Kingfisher’s sales in the UK did significantly better than at its French business Castorama where they declined 3.8%, roughly at a similar pace as in the first quarter. However, the market remained cautious about the company because the sunshine failed to dispel the Brexit clouds and Kingfisher shares dipped 2.29%. 

Pound and euro nudge higher

The currency markets seem to have stabilised after the free fall in the Turkish lira over the last two weeks and now the Turkish currency is trading higher against the dollar for the third day in a row, at 5.8342. The pound and the euro are also tentatively higher against the greenback, trading up 0.03% and 0.25%, respectively, against the US currency. The pound, however, remains the weaker link against the euro as Brexit deal concerns linger in the background. 

Build your confidence risk free
Join our live webinars for the latest analysis and trading ideas. Register now

StoneX Financial Ltd (trading as “City Index”) is an execution-only service provider. This material, whether or not it states any opinions, is for general information purposes only and it does not take into account your personal circumstances or objectives. This material has been prepared using the thoughts and opinions of the author and these may change. However, City Index does not plan to provide further updates to any material once published and it is not under any obligation to keep this material up to date. This material is short term in nature and may only relate to facts and circumstances existing at a specific time or day. Nothing in this material is (or should be considered to be) financial, investment, legal, tax or other advice and no reliance should be placed on it.

No opinion given in this material constitutes a recommendation by City Index or the author that any particular investment, security, transaction or investment strategy is suitable for any specific person. The material has not been prepared in accordance with legal requirements designed to promote the independence of investment research. Although City Index is not specifically prevented from dealing before providing this material, City Index does not seek to take advantage of the material prior to its dissemination. This material is not intended for distribution to, or use by, any person in any country or jurisdiction where such distribution or use would be contrary to local law or regulation.

For further details see our full non-independent research disclaimer and quarterly summary.