FTSE in cautious mode

The FTSE is tentatively lower thanks to the stronger pound but banks and mining stocks are putting in a good performance. There might be more volatility in store for sterling today, the last day of the Conservative Party conference.

FTSE in cautious mode

The FTSE is tentatively lower thanks to the stronger pound but banks and mining stocks are putting in a good performance. There might be more volatility in store for sterling today, the last day of the Conservative Party conference. Indices across Europe are also trading lower, still somewhat perturbed by Italy’s budget plans although the country made a reconciliatory step towards the EU yesterday. 

Up, up and away

Somebody in the market is having a field day with Brent Crude prices and no voice of reason will stop that, at least not until November, the due date for Iranian sanctions. Brent crude has notched up every single day this week and is now trading comfortably above $86, a level that seemed far-fetched only a few weeks ago, leaving behind the WTI contract. The case for higher WTI prices has been beaten down by rising US inventories showing there was no build-up of supply shortage. The gap between Brent and WTI has flared up to around $10 compared to only about $7 a month ago. In contrast, in London the slightly panicked oil buying is speeding up as the deadline for Iranian sanctions draws nearer and even evidence that Russia and Saudi Arabia have privately agreed to raise crude output was not enough to really halt the rally in a sustained fashion. 

Unilever resistance builds up 

The resistance against Unilever’s decision to move its headquarters to Netherlands is gaining ground as another institutional investor joins the ranks of the dissenters. The company may have difficulty getting the decision approved on 25 October because it requires consent from 75% of UK shareholders and 50% of Dutch shareholders. The investment firms opposing the move still don’t hold a stake large enough to be able to outright vote against the move, but they are gathering a following among other UK shareholders who don’t want to see the value of their stock decline. For the time being the company’s shares still continue to slide.


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.