Equity markets in Europe are mixed today as volatility remains low. The FTSE 100 is in the red and consumer staples and health care stocks are the biggest fallers.
Global markets had a muted reaction to the Chinese figures overnight. The economy grew by 6.8% in the final quarter of 2017, which was slightly than the 6.7% expected. Retail sales cooled to a growth rate of 9.4%, down from 10.2% growth in November.
Associated British Foods reported a 3% rise in revenue for the 16 weeks until early January. The company is hopeful that it will see an improvement in relation to profits, and it is confident it will achieve its full-year target. As per usual the Primark division performed well, and posted a 9% increase in sales. The sugar business saw a 13% drop in revenue, but sugar prices have been relatively weak recently. The share price is down 2.7%.
Whitbread revealed a 0.3% increase in like-for-like (LFL) third-quarter UK sales. The company expects ‘tough UK high street environment and inflation’ to persist. Premier Inn eked out a 0.5% rise in revenue for the period, which was helped along by restaurant sales. Costa Coffee continues to underperform as LFL sales dipped by 0.1% in the UK. Last month activist investor Sachem Head Capital Management revealed they own a 3.4% stake in the company, and the fund is promoting the idea that Whitbread spin-off Costa Coffee. The disappointing numbers from the coffee division today could fuel speculation of a break-up. The stock is up 2.1%
GBP/USD and EUR/USD are both a slightly higher on the session as the US dollar has cooled a little today. The pound and the euro have enjoyed positive runs versus the greenback recently, and today’s upward move could be the beginning of another leg higher.
At 1.30pm (UK time) the US will release the jobless claims report, and the consensus is for a fall to 250,000 from 261,000.
Morgan Stanley, American Express and Bank of New York Mellon will announce their quarterly figures today.
We are expecting the Dow Jones to open down 35 points at 26,080, and we are calling the S&P 500 down 4 points at 2798.
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