FTSE higher on China deal, Iran ceasefire

The FTSE made progress this morning as the US and Iran seem for the moment to have stepped away from the brink of a conflict.

The FTSE made progress this morning as the US and Iran seem for the moment to have stepped away from the brink of a conflict. President Trump’s less confrontational tone helped lift US markets during the Wednesday session and the upbeat mood shifted to Asia and Europe Thursday. 

Another significant boost for the market came from the progress between the US and China as China’s chief trade talks envoy Liu He confirmed that he will be coming to Washington next week to sign the first phase of the Sino-US trade deal. 

Big retailers struggle but smaller players come out tops

Now that the Christmas tinsel has been cleared away and UK retailers have done the math on their festive sales the numbers make for a sobering reading. Tesco reported slightly higher overall sales only because higher sales in Europe balanced out the weaker performance in the UK. 

Marks & Spencer fared worse and is now forecasting gross margins at the lower end of its guidance given that sales were below expectations while John Lewis Partnership said it may not pay out bonuses following a decline in revenues. 

The one standout performance came from home furnishings chain Dunhelm which managed to increase sales by 5.6% in the first half of its financial year. 

Tesco’s shares rallied 2.75%, M&S shares took a 10% hit and Dunhelm rose 0.6%

Oil, gold lose momentum

Without the Iran wind in its sails Brent crude prices settled back in the $65-$66 range, trading up half a percent on the morning. If Iran news remains on the back burner some support could come from the signing of the US-China trade talks next week and also stock building ahead of the Chinese New Year later this month. 

Gold has retreated from a 6-year highe it hit earlier this week and is trading down 0.8%.

Join our live webinars for the latest analysis and trading ideas. Register now

GAIN Capital UK Limited (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.