Stock markets are in positive territory heading into the close. 

Europe

The reasonably positive US non-farm payrolls report, combined with continued optimism surrounding the US-China trade talks has helped stock markets. The US jobs report won’t upset the apple cart in terms of Federal Reserve monetary policy, and given the lack of negative news out of Europe today, sentiment was given a boost.    

GVC shares are a little higher this afternoon after the company announced an 8% rise in quarterly net gaming revenue. Online gaming continues to be the star performer as revenue jumped by 17%, and that helped make up for the for flat UK like-for-like revenue. The firm is confident it will achieve double-digit revenue this year, despite the tighter regulation to the fixed odds betting in the UK. To offset the tougher regulatory environment in the UK, the company has been expanding in the US, and that avenue is likely to play a bigger part in the business in the years to come. The stock has been in decline throughout 2019, but if it can hold above the 504p mark, it might push higher.

Stagecoach shares sold-off today after Jefferies cut their outlook for the stock to underperform from hold, and the price target has been lowered to 125p from 140p.

Funding Circle confirmed that it will wind down its funds that is focused on funding for small and medium firms. The group said it consulted with shareholders, and it has decided to stop investing in new ‘credit assets’ and begin the process of returning capital.   An increase in default rates in the US led to lower-than-anticipated returns. The company will launch two new products in the UK, and it intends to focus more on the institutional side of the business. 

US

The major indices are pushing higher on the back of the mixed jobs report. The headline non-farm payrolls figure was 196,000, which topped the forecast of 180,000, and the February reading was revised up to 33,000 from 20,000. The unemployment rate held steady at 3.8% - meeting forecasts. The wages figures were not so hot. Yearly average earnings cooled to 3.2% from 3.4%, and monthly earnings grew by 0.1%, which was a sharp decline from the 0.4% in February. Overall, it was an alright report. If anything, it justifies the Fed’s intention to keep interest rates on hold for the foreseeable future, and the report wasn’t so bad that it shook investors’ confidence in the US economy.

FX

The US dollar index saw a jump in volatility on the back of the US jobs report. It was a neutral update from the point of view of the greenback. The US central bank are likely to keep their policy unchanged in the wake of the numbers, and the US dollar might retain its attractiveness in the face of sterling and euro uncertainty.

EUR/USD hasn’t moved much today. German industrial production grew by 0.7%, which was a nice change from the dreadful industrial orders and manufacturing PMI report announced this week.

GBP/USD is in the red as Brexit uncertainty hangs over the pound.  The UK government will ask the EU for an extension to the Brexit date, and it would like the departure date to be pushed back until the 30 June, on the other hand, Brussels are keen to offer the UK an extension of one year.

USD/CAD has pushed up after the US jobs report, and the slightly soft Canadian jobs update. In March, the Canadian employment change dropped by 7,200, while the consensus estimate was 1,000, and that added to the Canadian dollar weakness.  

Commodities

Gold has been nudged a little lower on the back of the US non-farm payrolls report. The metal endured a decline in mid-March, and even though the price has stabilised, it has struggled to retest the $1,300 mark. A break below $1,276 region might pave the way for further losses.

Oil is higher today as falling output from OPEC has put pressure on the energy. Last month, OPEC output dropped by 570,000 barrels per day to 30.23 million barrels per day in the month – the lowest in more than four years. The general optimism about US-China trading relations has helped demand too. 

 

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