A 100-point gain on the open for the FTSE 100 has put the index in bullish form on the first day of the new week. Glencore is the main story this morning, up 5% on news it may begin some asset disposals to boost its financial position. Once, this cash pile was the firm’s acquisition war chest but those days are long gone now, with riding out the commodity storm now the company’s primary focus.
Much of the heavy lifting this morning is being done by oil stocks; these have been given a boost as oil prices rise, as the headlines from Syria get worse. One great power actively intervening is worrying enough, but with US and Russian jets now sharing the same airspace investors will be forgiven for feeling a little nervous.
Banks are also in focus as the government officially announced a fresh sale of part of its Lloyds stake. Shares in the bank are modestly higher, as the market continues to welcome the steady reduction in the state’s holding, but until the full details are announced enthusiasm is likely to be fairly muted.
Figures from the UK services sector fell below expectations, putting a swift end to the pound’s early rally this morning. With a Bank of England decision due this week, those hoping for some hawkish commentary have just had their guns spiked. It looks increasingly likely that Mark Carney will have to shelve any plans for a rate rise, following the lead set in Washington.
Wall Street looks set for a healthy open despite Friday’s lacklustre jobs report. The lack of fresh bad news over the weekend, plus the usual bout of optimism that is prevalent at the start of the fourth quarter, has helped matters. The question is the same as it was in September, namely can the buyers muster up enough momentum to turn these brief sparks into a full-blown outbreak of buying, or will their efforts go unrewarded yet again? Ahead of the open, we expect the Dow to start 50 points higher, at 16,427.