How Did The Market Perform In The Second Week Of February 2019?

London’s broader equity benchmark FTSE 100 index traded lower against its Thursday’s closing price.

US market broader equity benchmark S&P 500 index and the tech index Nasdaq ended higher on Friday after two consecutive days of fall, as strong set of corporate quarterly numbers offset the scepticism over the China and US reaching a trade deal before the March 1. On company specific update on the global level, stocks of Motorola Solutions Inc, Coty Inc and Mattel Inc jumped after the companies reported good sets of quarterly earnings than expected. Apart from these, shares of Electronic Art Inc surged after videogame maker said its game Apex Legends had attracted 10 million players in three days while the company's stock plunged heavily on Wednesday after reporting weak earnings for the quarter.

Coming back to the European market, broader equity benchmark FTSE 100 index ended the Friday’s session in red against its Thursday’s closing price. On February 08, 2019, FTSE 100 index closed the session at GBP 7071.18, down 22.40 points against its previous closing price. Although the index is up 0.73% during the week, another European benchmark STOXX 600 ended the Friday's session 0.56 per cent lower against its previous closing price.

On Thursday, Jaguar Land Rover parent company Tata Motors Ltd posted its gigantic loss damaged by an impairment charge for its UK luxury car business Jaguar Land Rover. British luxury car Jaguar Land Rover (JLR) unit, which has been dented hard by ongoing US-China trade disputes, weak demand for diesel cars in Europe and uncertainties around the tumultuous Brexit, had taken its Indian parent Tata Motors Ltd (TAMO.NS) in to most significant loss in three years in the quarter ended June 2018. It is one of the massive interim losses in Indian corporate history.

Car manufacturers across the globe are facing a tough time, from Brexit uncertainties, regulatory issues on the use of diesel cars and the transition to the electric vehicle. Japanese carmaker Honda was the early acknowledger of an industry-wide decline in the diesel car market. Recently, Honda slashed 350 jobs at its Swindon plant. The entire automotive industry has been suffered by slowdown sale in off-take, but in the case of JLR, it is primarily affected because of a high proportion of diesel cars in its product portfolio.

Brexit Update: With less than 50 days left for Brexit, Labour's leader Jeremy Corbyn wrote a letter to British Prime Minister Theresa May, in which the most contentious demand is to keep a permanent customs union between EU and the UK, and it is something that Theresa May has always ruled out. Corbyn's letter also annihilates his MPs, and they said his letter to the British Prime Minister failed to express the second referendum directly.

A Labour party politician, David Lammy said that “our inability to oppose Brexit would be a strategic delusion that would have Labour party out of power for a generation.”

Meanwhile, on Thursday, the British Prime Minister Theresa May met Claude Juncker, European Union president, and both agreed to reopen Brexit talks to resolve this contentious Brexit immediately. On Thursday, Donald Tusk, European Council President and Mr Juncker said, we would welcome a Britain's decision to sign up a permanent customs rule with Brussels as a way to discarding the standoff, a proposal backed Labour leader Jeremy Corbyn.

Performers and Laggards on LSE

Stocks like Lonmin Plc (LMI.L), LSL Property Services Plc (LSL.L) and Sthree Plc (STHR.L) were among the top performers on the London Stock Exchange and were up by 7.8%, 5.1% and 5.0%, respectively; and on the other side, stocks like Thomas Cook Group Plc (TCG.L), Nostrum Oil & Gas Plc (NOG.L) and Alfa Financial Software Holdings Plc (ALFA.L) were among the laggards on the London Stock Exchange and were down by 15.1%, 9.7% and 6.2% respectively.

At LSE, stocks like Lloyd Banking Group Plc (LLOY.L), BP Plc (BP.L) and Vodafone Group Plc (VOD.L) were again top active volume stocks on Friday.

Broader Index – FTSE 100 Index cues

Stocks like Ocado Group Plc (OCDO.L), Barratt Developments Plc (BDEV.L) and Burberry Group Plc (BRBY.L) were among the top gainers on the broader equity benchmark FTSE 100 index and were up by 3.5%, 1.8% and 1.27% respectively. However, stocks like Melrose Industries Plc (MRO.L), Tui AG (TUI.L) and Hargreaves Lansdown Plc (HL.L) were laggards on the FTSE 100 index and were down by 4.9%, 4.3% and 4.19%, respectively.

On sector specific, Healthcare and Technology traded in green, and all other sectors on the broader index FTSE 100 traded in red on Friday.

Commodity Market

At the time of writing,

• Brent Crude was trading 0.75% higher at $62.09 per barrel
• West Texas Intermediate Crude oil was trading 0.11% higher at $52.70 per barrel
• Gold was at $1318.35 an ounce

London Metal Exchange Cues (in USD)

• LME Aluminium traded at $1865 per tonne.
• LME Copper traded at $6207 per tonne.
• LME Zinc traded at $2688.50 per tonne.
• LME Nickel traded at $12735 per tonne.
• LME Tin traded at $21050 per tonne.
• LME Lead traded at $2066 per tonne.

Forex Market Cues

At the time of writing,

• British Pound was trading against the US Dollar (GBP/USD) at 1.2945.
• Euro was trading against British Pound (EUR/GBP) at 0.8739.
• US Dollar index was trading higher against majors at 96.64.

Money Market Cues

At the time of writing,

• US10-year treasury bond was trading lower at 2.63%
• UK 10-year treasury bond was trading lower at 1.14%

Key Events to Watch This Week in UK

• GDP Estimate
• CPI rate
• Retail Sales Data