September has got off to a fitful start, as various holidays around the globe have meant that it has been hard to get an overall impression of sentiment in recent days. China got back into action today, but with US markets off for Labor Day European indices look set for an afternoon of drift today. Nonetheless, sentiment recovered from Friday’s poor finish, as investors start to look at Friday’s US job numbers in a more optimistic light. However, we have still to see a strong and sustained rally develop across risk assets, and with China data due later in the week many will be keeping their powder dry.
Battered commodities titan Glencore surged on the open this morning after it announced plans to start plugging the debt hole in its accounts. In addition, it is cutting back on production by closing some African operations and also cutting the dividend. Given how crowded this short trade has been, it is not surprising to see such a bounce in the shares, but it will be interesting to see whether this is more than just a flash in the pan.
Associated British Foods has taken a small knock today after it issued a profit warning, as its sugar division continues to feel the pain. Primark’s US expansion has helped keep the conglomerate on an even keel, but even here the signs are not as encouraging as they once were, and the news will reignite speculation over the wisdom of retaining two such contrasting businesses under the one roof.