Today the corporate data focus has shifted away from the US and on to the UK, with a number of companies updating the markets with their latest figures. Unfortunately the impressive performance of the US equity markets, where over 70% of companies have been able to beat expectations, does not look like it will be replicated here. One stock bucking the negative outlook trend is, somewhat surprisingly, Royal Bank of Scotland. In fact, the company has been so pleased with itself it has been unable to contain its excitement and posted the eye-catching first-quarter figures of a £1 billion pre-tax profit a week early. Although this is an encouraging sign, we are still some way off seeing the government being in a position to reduce its 81% holding in the bank.
In a considerably less optimistic press release, mining companies Anglo American and Lonmin have painted an altogether gloomier picture with a combination of poor commodity prices, difficult currency hedging headwinds and continued disruption at platinum mines contributing to both erring on the side of caution with their forward guidance.
Adding to the corruption allegations it is currently facing in China, GlaxoSmithKline now looks to be dealing with similar issues in Syria.
Vodafone’s figures, without the attractive Verizon dividend, were always going to be much less enticing to investors. Adding to the company's woes are the difficult markets in Spain and South Africa, and the changing regulatory environment in Europe that has benefited phone users at the cost of service providers.
Last night saw the S&P 500 set an all-time high, while at the same time both the NASDAQ and Wall Street wobbled. Now past the half way mark in the US reporting season assessments on its success are being made, and with over 70% of companies posting figures beating earnings per share expectations equity index traders can feel justifiably smug. Those calling for a correction on the earnings multiples of US companies being too high may still have a point, but companies are doing their best to post figures that will go some way to validating all that optimism.
Ahead of the open we expect the Dow Jones to start 22 points lower at 17,061.