It was a choppy start to the morning in the London markets, with the FTSE down 0.45%. Globally markets are in negative mood this morning on the back of poor data from China which analysts now reckon is evidence that the trade war with the US is having an impact. Fixed asset investment in China is also now at its lowest level since it began to be formally tracked in 1996.
There was also a poor report out of Japan which drove the Nikkei down 0.8%.
In Europe there were also bearish economic data from Germany, which narrowly dodged a recession following its Q3 GDP data release. European traders did not like it and most European bourses are down this morning as a consequence.
Burberry surges on good H1 profits
Shares in Burberry Group are up over 5% this morning. The fashion firm said H1 profits were up by 5% versus the same period last year. This seems to have surprised investors who have become used to a string of bad numbers from fashion retailers. There are concerns that the riots in Hong Kong may be hitting Burberry sales for H2.
No progress on China talks hits confidence
The market has been waiting for some time now for concrete progress in the US-China trade talks. There had been hopes that the Trump administration would announce something this week but rumours in Washington indicate that talks have hit an impasse over farm purchases.
All this additional risk concern is feeding through into some safe haven buying in the currency market. Both the JPY and CHF are close to week highs versus the dollar. The USD is currently responding to any news of progress – or lack thereof – from the China talks which has become a major focal point for traders.
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.