market relief

Stocks are mixed this morning despite the heightened trade tensions between the US and China. 

Both the US and China have imposed tariffs on $34 billion worth of each other’s imports. President Trump has threatened to set up the trade dispute, and has made it clear that the ball is now in Beijing’s court. Traders are taking the news remarkably well, as they await a response from the Chinese government. Investors are also looking ahead to the US non-farm payrolls report at lunchtime.

ITV shares are in demand after Societe Generale upgraded the stock from sell to buy, and raised the price target to 220p, from 150p. ITV’s share price has been pushing higher since April, and this morning hit an 11-month high, underlining the bullish sentiment.

Rolls-Royce revealed it plans to sell its commercial marine business to Kongsberg for £500 million. The unit has a track record of losing money, and this is part of Rolls-Royce’s restructuring plan.

Inmarsat shares are in the red after the company rejected a second bid from EchoStar, but the US firm revealed it will continue its effort to take over the London-listed company. EchoStar has until 5pm today to make a formal offer for Inmarsat, and they confirmed they will be seeking an extension to the deadline, which suggests they are still interested in the company. Inmarsat’s share price has retreated since late June, but selling pressure might wane as EchoStar are still intent on taking over the firm.

GBP/USD edged up on the back of the latest Halifax UK house prices report. The update showed that house prices increased by 0.3%, meeting forecasts.

At 1.30pm (UK time) the US will release the latest non-farm payrolls report, and the consensus estimate is for 195,000 jobs to have been added in June, and that compares with the 223,000 jobs that were added in May. The unemployment rate is tipped to remain at 3.8%. Average earnings on a yearly basis are expected to rise to 2.8% from 2.7%.

PriceSmart shares will be in focus today as the stock dropped in after-hours trading last night. The sell-off was triggered after the firm revealed its third-quarter figures, and the earnings per share was 61 cents, while the consensus estimate was 63 cents. 

We are expecting the Dow Jones to open down 60 points at 24,296 and we are calling the S&P 500 down 2 points at 2,734.

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