The Swiss are known for their neutrality, but today’s move by the Swiss National Bank is far from neutral. The sudden abandonment of the floor by the Swiss central bank has sent the markets into a tail spin. Equity markets have been shaken out by the Swiss move, and dealers are seeking the safety of the US dollar. Markets are still struggling to puzzle out the full implications, but the sudden drop in equity markets as well in the FX sphere shows that the move caught everyone off guard. Inevitably the question of how this links to European Central Bank quantitative easing is being raised – it might be too much to suggest the SNB know something we don't, but any significant move from the ECB would be bound to put pressure on the SNB and its monetary policy, and today's move may be an attempt to fortify the SNB's position ahead of Mario Draghi's appearance next week.
Home Retail Group’s underwhelming third-quarter update dragged the share below the 200p mark in early trading. The company is half way through its three-year turnaround plan, and the recovery is running out of steam. Although the restructuring of its Argos and Homebase stores is still under way, the drop off in consumer confidence its hindering its bounceback.
Tullow Oil is on the ropes after it revealed $1.2 billion in writedowns last year. The troubled oil explorer slashed its capital expenditure budget and has left the door open for more cuts. Tullow Oil is still in the crosshairs of short-sellers, as a string of dry wells coupled with a collapse in the price of oil is making it a soft target.
Bovis Homes had a strong finish to last year and has gotten off on the right foot in 2015, with reservations in the double digits. The home builder is likely to remain a stable stock for 2015 as ultra-low interest rates and steady house prices will ensure reliable growth.
We are expecting the Dow Jones to open 67 points lower at 17,360, as the Swiss shockwave is weighing on the US index futures.