It seems like the market players are now turning their heads towards the earnings season. The US markets are reacting to the news related to the earnings reports. Yesterday, Dow Jones Industrial Average ended the session on the positive note as the Goldman Sachs and Bank of America have managed to report for strong quarterly earnings. It can be said that moving forward, the investors in the US markets would be concentrating more on the earnings season. However, the European markets are dealing with their issues. The markets there are quite uncertain primarily because of the political tension prevailing.
Prime Minister Theresa May Won Confidence Motion and Unlocked Cross Party Brexit Talks. But Labor Leader Jeremy Corbyn, the leader of the opposition, said Prime Minister must work throughout the idea of no-deal Brexit as a prerequisite for further talks. He added, now that May is currently running a “Zombie government.” The inability of Theresa May to convince the British parliament for her Brexit deal even after two years of a long negotiation with Brussel has pitched off the EU bloc and they can barely hide their anger with the UK. Emmanuel Macron, French Prime Minister, said, “Time is almost up, we can’t offer concession to solve internal UK politics problem.” He also added “we went as far as we could”. Also, there are increased tensions related to global growth, and the market players are avoiding making investments in the present scenario. The worries about the weaker Chinese economy has also been impacting the overall sentiments of the players. China’s import and export data witnessed unfavorable momentum which added to the worries about global growth. During the day (January 17, 2019), European markets were seen to be trading in red as the FTSE 100 Index was down by 0.36% while STOXX 600 was trading up by 0.06%.
Meanwhile, at global front, Investment Bank Morgan Stanley (MS.N) reported its profit, which fell short of analyst expectation, as bond traders trip in a volatile market. Goldman Sachs Group Plc (GS.N), Bank of America (BAML), Citigroup Inc (C.N) and JPMorgan Chase & Co (JPM.N) reported a decline in revenue, blaming volatility in interest rates in the global market to be making some impact. Asset manager Mirae Assets Daewoo announced cut in paid-up in UK unit because of Brexit.
UK Stocks like Associated British Food Plc (ABF), The Sage Group Plc (SGE) and GVC Holdings Plc (GVC) were among the top gainers on FTSE 100 index and up by 6.98%, 5.4% and 2.1%, respectively and the top laggards on FTSE 100 Index included ITV Plc (ITV.L), John Wood Group Plc (WG.L) and NMC Health Plc (NMC.L), down by 5.9%, 4.65%, and 2.1%, respectively. Meanwhile, Apparel retailer Gymboree files for bankruptcy again.
FTSE ended the session in red on Thursday (down 0.4% to 6,834.92), as gains in Technology, Consumer non-cyclical and Telecommunication were settled by losses in Financials, Energy, and Utilities, while investors are turning cautious in UK market ahead of Brexit uncertainties.
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