Global market

Market overview: US unemployment claims below forecasts


us-unemployment   The monthly unemployment report is likely to be a victim of the US government shutdown

  1330: Initial weekly US unemployment claims rose by 1,000 to 308,000 in the week ended on September 21st, versus the 315,000 expected by economists.

  1320: Vodafone’s CFO will step down from his role of nine years once the sale of its stake in Verizon Wireless completes. The stake, which is being sold for 80bn pounds, is expected to be sold by March 2014. The FTSE has risen 24 points to 6,461.50.

 1242: Overnight the Chicago Mercantile Exchange (CME) hiked its margin requirements for operators in the Dow Jones, SP 500 and Nasdaq E-Mini futures contracts by nine per cent. According to Zerohedge that may be a result of President Obama’s remarks to the effect that Wall Street has not yet recognised the seriousness of the current impasse on Capitol Hill.

1120: A little more colour on Aviva, in remarks to Sharecast Ronni Chopra – Head of Strategy at Tradenext – pointed out that in the medium-term the stock might still be a potential take-over target. FTSE 100 up 17 to 6,454.

1100: Insurance group Aviva is leading gains this morning after completing the sale of its US business for a higher amount than it first expected. It will receive proceeds of 2.6bn dollars from the sale of its US life and annuities business to Bermuda-based Athene Holdings, around 0.8bn dollars more than it had announced last December.

1000: Eurozone retail sales have come in better than expectations: sales rose at an annual rate of 0.3% in August (forecast: -1.5 per cent); and increased by 0.7% at a monthly rate (forecast: +0.2 per cent).

0930: Britain’s service-sector growth slowed slightly in September as a sharp rise in new business placed strain on company resources. Markit’s purchasing mangers’ index (PMI) for the services industry fell to 60.3 last month from 60.5 in August, missing consensus forecasts for a reading of 60.5. However the index remained above the 50 level that signals expansion. The Eurozone serivces PMI meanwhile unexpectedly rose from an initial reading of 52.1 to 52.2; analysts had predicted no change.

0838: The top-flight index is now registering small gains, tracking a late recovery on Wall Street, although most financial media outlets continue to warn of the risks should traders turn out to be mistaken in their optimism regarding the debt-ceiling negotiations in the US. They are not alone, yesterday the Bank’s Director of Markets, Paul Fisher, said that “if it got to the stage when the US did not pay interest on its debt, that could be extremely serious.” EasyJet is leading gains after raising its full-year guidance. Aviva has completed the sale of its US business for a higher amount than it first expected . At 09:28 services PMI for September is released and we expect the headline index to have edged up to 61.0 from 60.5 previously (consensus: 60.5). Overnight the Chinese services purchasing managers’ index (PMI) for September jumped to 55.4 from the prior month’s reading of 53.9. 50 is the dividing line between expansion and contraction. FTSE 100 up 23 to 6,460.

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