Developments around Europe over the last couple of weeks have seen George Osborne stuck between a rock and a hard place. The recent veto from the House of Lords over planned savings with tax credits, coupled with increased defence spending will have seen several re-writes of today’s speech. Early trading has seen house builders dominate the list of best performing FTSE shares as renewed efforts to tackle the housing shortage look to be on the cards. The greater uncertainty lies in which sectors are likely to suffer as the chancellor tries to balance the books.
It is always encouraging to hear bullish statements from CEOs as they outline their targets for the future and, at face value, Thomas Cook’s objective of starting dividend payments in early 2017 is welcome news to investors. Before that can happen a more stable European arena will be required with disruption to popular tourist destinations in Tunisia and Egypt hampering revenues. It will take some time to assess but the recent events in both Paris and Brussels could also trigger a return to the staycation.
Shares in Daily Mail & General Trust have slumped this morning as it looks forward to a difficult 2016. The hard copy is struggling to secure enough advertising revenue, but at least the online version maintains its status as the most read online newspaper in the world.
Even though the chancellor’s Autumn Statement dominates traders’ thinking, there is still a healthy quota of economic data being released in the US to warrant attention. Markets will be watching to see if either core durable goods or flash services PMI data will derail current Fed rate expectations, while oil traders will be closely monitoring the latest crude oil inventories as the latest annual OPEC meeting in Vienna gets ever closer.
Ahead of the open we expect the Dow Jones to start 51 points higher, at 17,863.