Stocks are in the red this morning as traders are in risk-off mode. 

Equity markets are handing back some of yesterday’s gains and traditional safe-haven assets like gold and bonds are in demand. The memories of the recent sell-off are still fresh in traders’ minds and some investors are tetchy that we are not out of the woods yet.

TUI AG issued a positive trading update as the company performed well in the first three months of the year. Revenue jumped by 8.1% in the first-quarter while the loss dropped by 58% to €24.9 million. The company took a €20 million hit on account of air Berlin’s Niki business going bust. The firm generated cash through the sale of Rui hotels for €38 million. Tui is ‘well positioned’ and is ‘progressing in line’ with expectations.  The stock hit an all-time high this morning so the sentiment is clearly bullish, and if the rally continues it could target 1700p.

Shares in Pendragon are higher this morning despite the drop in profits. Earnings dropped by nearly 20% revenue from new vehicle sales declined by 4.9%. The company performed well in terms of used car sales and aftersales. Pendragon is going to focus more on technology and ‘provide an online and technology platform’, and is going to sell its US operation. The stock has been in decline for two years, and if the wider bearish move continues it could target 17.5p.

GBP/USD ticked higher after the UK inflation rate held steady at 3%, and economists were anticipating a decline to 2.9%. The core CPI rate edged up to 2.7% from 2.5%, while the retail price index (RPI) slipped back to 4% from 4.1%. Overall the reports are slightly hawkish and bodes well for sterling.

PepsiCo will release their quarterly figures today.  

We are expecting the Dow Jones to open down 161 points at 24,440 and we are calling the S&P 500 down 14 points at 2642.

CMC Markets is an execution-only service provider. The material (whether or not it states any opinions) is for general information purposes only, and does not take into account your personal circumstances or objectives. Nothing in this material is (or should be considered to be) financial, investment or other advice on which reliance should be placed. No opinion given in the material constitutes a recommendation by CMC Markets or the author that any particular investment, security, transaction or investment strategy is suitable for any specific person.