By close on Thursday (26 July), the FTSE 100 was 4.9 points higher at 7,663 as the blue-chip index failed to take advantage of a weaker pound amid Brexit concerns and a raft of positive corporate results.
As the traditional summer lull kicks in, investors should look out for Markit’s UK manufacturing data for July on Wednesday (1 August) and construction data on Thursday (2 August). In June, growth in the UK manufacturing sector was relatively subdued, posing questions over how long a marked revival since the beginning of the year can continue. UK construction data could be more optimistic after output growth hit a seven-month high in June thanks to more residential work and commercial building, but investors should watch out for any impact from the heatwave.
The drinks sector has attracted significant focus from investors amid the ongoing heatwave in the UK. Premium mixers specialist Fevertree Drinks (FEVR:AIM) saw a large share price rise after saying its earnings would beat expectations mainly thanks to strong sales in the UK.
Britvic (BVIC) wasn't as lucky as the heatwave driver was dampened by carbon dioxide supply issues affecting large parts of the drinks industry including itself. Compounding these issues was that fact that Britvic has recently reduced sugar content in some of its products due to the recent UK sugar tax. It had hoped to get a feel of how the recipe changes were received by the public, but the hot weather has made it hard to tell if current sales are a result of consumers liking its products or simply because they want to quench their thirst.
There is still nervousness about the state of the Eurozone economy after a poll of purchasing managers indicated that growth could remain weak in the second half of the year. The flash reading of the purchasing managers' index for July came in at 54.3, a decline from June's 54.9 reading. A figure above 50 represents an expansion in activity, but the fall could indicate that Eurozone growth is past its peak following a bumper 2017. Manufacturers are not carrying as much stock and investment decisions are being scrutinised more closely.
Platinum prices are close to a 10-year low amid concerns about too much supply versus demand. Investors have two ways to play the situation with exchange-traded funds (ETFs). Anyone who believes the price could recover could consider iShares Physical Platinum (SPLT) which tracks the return of the platinum spot price. Anyone who thinks the metal price could fall further could look at ETFS 1x Daily Short Platinum (SPLA) which is designed to move in the opposite direction of the platinum price.
31 July – It has been a volatile year for online delivery platform Just Eat (JE.) after it decided to introduce a delivery network for £50m to compete with rivals Deliveroo and UberEats. Investors will be hoping for good news when the company reports its half year results on Tuesday following a surprisingly cautious outlook and no guidance for 2018 at its Capital Markets Day in June.
1 August – In May, high street retailer Next (NXT) upgraded full year sales and profit guidance thanks to strong first quarter trading. Investors will be keen to see if Next can continue its robust performance in its latest update on Wednesday.
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