Friday's market menu _ 05 feb 2016 _ news. markets
On Tuesday, after talks with European Council President Donald Tusk, Cameron said four key demands had been met including an ’emergency brake’ on benefits for migrant workers and measures to give national parliament more power to block EU laws. That’s because the economic recovery in both the US and UK has been marked this time round by sluggish wage growth, and that does nothing to help the central banks with their mandate to return inflation to around 2.0%. The CMC Markets IPO price range was set at between 235 pence and 275 pence a share, which would give the company a market valuation
of about £736 million at the mid-point of the range. The strategists at Goldman Sachs have said they don’t expect a so-called Brexit, but if it does happen then sterling could lose about 20% of its value in the short-term on a trade-weighted basis. Additions have been strong for months now, and the devil is often in the detail.
For example, average hourly earnings were only flat on the month in December, and this number could disappoint again if it doesn’t reach the 0.3% economists expect this time round. Earlier this month, the FO banking labour union said BNP Paribas is going to restructure and simplify its wealth management operations. Economists expect the US economy to have added 190,000 jobs in January, compared with the 292,000 added in December. 3) And what of the other companies reporting earnings? The UK corporate calendar is quieter on Friday with just a trading statement due from property company Shaftesbury and fourth quarter results from BG Group, the oil company being acquired by Royal Dutch Shell.
2) Will BNP Paribas fare better than European bank peers? The earnings season continues, with French bank BNP Paribas perhaps the highlight as it reports fourth quarter and 2015 earnings. There’s plenty for investors to trade on Friday, including US non-farm payrolls data and earnings from French bank BNP Paribas. Brazil has said the show will go on whatever happens, but it’s going to be much more difficult to turn a profit and create a legacy if visitor numbers are dented.
That’s not good for a country already mired in recession. 5) David Cameron seeks support for his EU reforms.
British Prime Minister David Cameron will be visiting Denmark and Poland as he seeks to build support for his EU reform proposals ahead of a meeting of EU leaders on February 18 and 19. However, UK eurosceptics have already been out saying they don’t go far enough to address concerns about Britain’s relationship with the bloc. Explainer Article: How does an IPO work? The CYBG IPO suggests there is investor demand for new offerings, but only at an attractive price. The shares have risen in the two days since the IPO. 4) Where will the CMC Markets initial public offering price? The IPO of the spread betting firm is expected to price on Friday, a few days after the London IPO of CYBG was priced close to the bottom of the pre-roadshow price range.
The scene is being set for a referendum on the UK’s membership of the EU, possibly in June. Friday marks six months until the opening ceremony of the Rio 2016 Olympic Games in Brazil. The volatile start to 2016 means the IPO market has got off to a very slow start. British Chancellor George Osborne has said the hit to banking shares has delayed the planned sale of the British government’s final stake in Lloyds Banking Group.
The first Olympics to be hosted by a South American city is being threatened by the outbreak of the zika virus, which could put off potential visitors and even many potential competitors. 1) What will the latest US jobs data, or non-farm payrolls, tell the Federal Reserve?
The data is the generally the most-watched of the economic calendar, although the central bank’s policy makers may now be swayed again by what’s happening outside the US. European banks have so far had another torrid time in the fourth quarter, as they’ve continued to book charges to cover mis-selling, litigation and fines. On top of that low interest rates mean net interest income isn’t growing much, and those with Asian operations have been hit by the concerns about growth in China. And another thing… Elsewhere, there are earnings due from the likes of Japan’s Toyota Motor and Sumitomo Corp, Estee Lauder and Tyson Foods in the US and Italian bank Banca Monte dei Paschi di Siena.