Traders await speeches as FTSE disappoints

Traders will, for the second day in a row, be treated to speeches from economic leaders Janet Yellen, Mario Draghi and Mark Carney but whether this will paint a clearer picture of markets' outlooks is somewhat debatable. 

City of London
Source: Bloomberg

Once again the FTSE 100 appears to be suffering from stage fright as the looming 7,000 level, for so long predicted to be broken, has yet again proven to be a step too far. Corporate data releases continue to come thick and fast offering equity traders plenty to chew on while regional economic leaders offer their latest comments as well. While not talking about specific economic releases the Bank of England governor Mark Carney will be speaking at a banking event this morning.

However, his ability to dance around difficult questions should ensure an absence of any volatile comments. A fancy footwork reputation that has not, as yet, been acquired by his European Central Bank counterpart Mario Draghi, who will be talking at this afternoon's ECB annual report in Brussels.  

Today it is the turn of Barratt Developments to post outrageously impressive half-yearly figures with pre-tax profits up by almost 75%, basic earnings up by almost 80% and a cash dividend up by 50%. Investors will be wondering how long this can last, but with last year’s change in stamp duty and the continuing support of the government's help to buy scheme, UK house builders are sitting comfortably for the time being.

Glasgow-based Weir Group has, in tough markets, been able to post better-than-expected revenue and pre-tax profits enabling it to raise the company's dividend for the 31st year in a row. Regardless of all of these positives the markets have shown it is never the here and now but always the future that is the primary concern as shares have fallen on the company’s expectations that profit margins will continue to be squeezed in 2015.

Less than a year after its float on the London Stock Exchange, AO World has had to cut its earnings outlook. This is not the confidence-filling actions of a management team that have a firm grasp of the online domestic appliance markets. It looks like the company's management believed a little too much of their own IPO PR hype as markets aggressively cut the 'blue sky' valuation of the company’s share price knocking it down by 45% in early trading.

Day two of the US semi-annual monetary policy report in front of the house financial services committee will once again see Federal Reserve chair Janet Yellen testifying. Yesterday’s speech left plenty of room for interpretation for both the doves and the hawks and barely caused a ripple in currency markets. Considering the uncertainty that continues to hang over the eurozone’s recovery and Asian wobbles, there appears little desire to go charging down the road of interest rate rises when no one else looks ready to follow.

This afternoon will also see the latest US oil inventories and with the recent rally in oil prices cooling it will be interesting to see if stocks have fallen by as much as expected. Ahead of the open we expect the Dow Jones to start just 2 points lower at 18,207.

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.

Find articles by analysts

Een artikel zoeken

Form has failed to submit. Please contact IG directly.

  • Ik wens per e-mail informatie van IG Group bedrijven te ontvangen over handelsideeën en IG's producten en diensten.

Voor meer informatie over hoe wij uw gegevens mogelijk kunnen gebruiken, bekijkt u ons Privacy- en toegangsbeleid en onze privacy website.

CFD’s zijn complexe instrumenten en brengen vanwege het hefboomeffect een hoog risico mee van snel oplopende verliezen. 79% van de retailbeleggers lijdt verlies op de handel in CFD’s met deze aanbieder.
Het is belangrijk dat u goed begrijpt hoe CFD's werken en dat u nagaat of u zich het hoge risico op verlies kunt permitteren.
CFD’s zijn complexe instrumenten en brengen vanwege het hefboomeffect een hoog risico mee van snel oplopende verliezen.