The FTSE 100 had one of its best days in months on Thursday (26 September), rising 0.8% to 7,351 as hopes were lifted about a US/China trade deal. The index rally was despite four FTSE 100 companies issuing profit warnings, being Imperial Brands, Pearson, Carnival and International Consolidated Airlines.
The UK kicks off the week’s economic data on Monday (30 September) with the revised quarterly estimate of gross domestic product (GDP). There will also be eyes on house prices as Nationwide’s monthly house prices index gets an airing. Tuesday (1 October) sees a deluge of eurozone manufacturing data, with US equivalent PMIs released later the same day. Wednesday (2 October) will give a chance to assess UK high streets with the publication of the British Retail Consortium/Nielsen monthly survey of shop prices. Next Thursday (3 October) will see services confidence fall under the microscope with eurozone data to be followed by the UK data, while US numbers come later the same day. Wrapping up the week on Friday (4 October) will be employment data from across the pond.
The hyper-competitive world of grocery shopping stays in the headlines next week with half year results from the UK’s largest supermarket Tesco (TSCO), due to be announced on Wednesday (2 October). That follows Sainsbury’s (SBRY) figures last week (25 September) when the UK number two’s announcement went down reasonably well with investors, who welcomed its price hike-driven return to growth in its grocery and clothing lines. Tesco faces its own challenges; having flogged its struggling sub-scale mortgages business to Lloyds (LLOY) in early September it is now concentrating on keeping hold of customers, driving up revenue and trimming costs so that margins and cash generation improve. Also on Tesco’s to-do list is greater use of in-store technology and being smarter with marketing.
On Monday (30 September) the Bank of England’s latest statistics on effective interest rates will be released. This statistical release contains average interest rates across deposit or loan accounts with UK banks and building societies, calculated using data on rates and balances. The Bank of England unanimously voted to hold interest rates at 0.75% at its September policy meeting but reaffirmed its pledge to gradual and limited rate rises under the assumption of a smooth Brexit and some recovery in global growth.
A reduction in India’s corporate tax rates from 35% to 25% is expected to benefit the domestic manufacturing sector and is the key reason why India’s main stock exchange has been rallying over the past week. One fund providing exposure to the country is Jupiter India (GB00B2NHJ040) which invests in companies which operate or reside in this part of Asia.
Many investors want a simple solution to accessing markets around the world rather than having to pick a range of different stocks or funds in different geographical territories. Vanguard FTSE All-World (VWRL) is among the exchange-traded funds tracking the FTSE All World index, which measures the market performance of medium and large-sized companies located around the world. It tracks approximately 2,900 holdings in nearly 47 countries.
1 October – Beleaguered postal business Royal Mail (RMG) will report on half year trading, an update expected to show parcels growth still failing to offset falling letter volumes. The whiff of industrial action blowing in the breeze will only add to the concerns of investors.
3 October – Spread betting platform CMC Markets (CMCX) will update on first half trading and investors will be hoping to draw a line under the regulatory clampdown on leveraged products sold to retail investors. CMC has responded so far by pushing deeper into the business-to-business market.
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