Traders await Mansion House show

Markets ponder the content of tonight’s Mansion House double bill show, ‘Carney and Osborne’. 

Mark Carney speaking
Source: Bloomberg

This morning’s session will be sprinkled with both industrial and manufacturing production figures from around Europe, and we will see the latest crude oil inventory figures; however, the focus of traders’ attention will be on tonight’s Mansion House speeches.

Even though Mark Carney will be on his home turf, he is almost certain to play second fiddle to George Osborne who will be using this to test the City’s waters on some of his summer budget plans now less than a month away. It is widely expected that he will outline plans of running a budget surplus, a laudable target although historically an infrequently achieved one.

The City will also be looking for clues as to how and when the Chancellor will look to sell off the taxpayers’ holdings in both Lloyds and RBS.

Sainsbury’s has kicked off the latest round of quarterly reporting for the food retailers, and as widely expected overseen another quarter of falling sales figures. The ongoing price war and the bounce in fuel costs have both contributed to tighter margins and falling sales. However, it is not all gloomy as online sales continue to grow and the firm is confident of outperforming its peers. This has seen the shares trade higher by 3.75%, the highest climber on the day.

Scottish oil and gas company Weir Group has had to handle some tough second-quarter issues. Optimistic noises about an upturn in the second half of the year have failed to convince traders who have driven the company 3% lower, making it the biggest FTSE faller so far today.

This afternoon will see the latest oil inventory figures released following last week’s OPEC meeting. The subsequent moves in oil prices have been higher primarily due to a dwindling belief that the Saudi’s will open up the taps more fully.

Regardless of the issues hanging over the euro and sterling, both have clawed back ground against a dollar that has been found to be less able to raise interest rates than initially believed. However, with the latest Federal budget balance figures due for release, these moves could still be reversed.

Ahead of the open we expect the Dow Jones to start 52 points higher at 17,816.

This information has been prepared by IG, a trading name of IG Markets Limited. In addition to the disclaimer below, the material on this page does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. IG accepts no responsibility for any use that may be made of these comments and for any consequences that result. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. Any research provided does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it. It has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Although we are not specifically constrained from dealing ahead of our recommendations we do not seek to take advantage of them before they are provided to our clients. See full non-independent research disclaimer and quarterly summary.

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