Stock markets in Europe are mixed today, and investors are looking ahead to the UK Autumn Budget this afternoon. 

The strong finish in Europe yesterday and the fresh round of record highs in the US last night has prompted some profit taking this morning.

Shares in Thomas Cook have taken a thumping today after the holiday operator stated that full-year operating margins fell to 22.1%, down from 23.4%. The squeeze in margins is due to tough competition in relation to Spanish holidays. The tourism business is similar to the supermarket sector as they both are in a race to the bottom in terms of prices, and ultimately it is the consumer that wins and not the shareholder. Revenue and pre-tax profits rose by 9% and 35% respectively, but traders fear margins could be squeezed further.

Qinetiq Group were upgraded from hold to buy by Berenberg and the bank raised its price target for the company to 310p from 235p. The stock is up 9.5% today and is currently trading at 220p.  

Weakness in the greenback has boosted the EUR/USD and has given a little assistance to the GBP/USD this morning. The lack of clarity in relation to what the Federal Reserve make up will look like next year is weighing on the US dollar. There will be four seats that need to be filled, and traders may be reluctant to go long the US dollar until they have a better idea what direction the US central bank will take.

The UK Autumn Budget at 12.30pm (UK time) will be closely watched, although it may not add a lot of volatility to the pound.

At 1.30pm (UK time) the US will announce weekly jobless claims and the durable goods figures, and the consensus is for 240,000 and 0.3% respectively.  

We are expecting the Dow Jones to open up 6 points at 23,596, and we are calling the S&P 500 down 1 point at 2598.

Deere & Co will announce their third-quarter results today.

 

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