MARKET INDICES SNAPSHOT

Index

Level

Chg (%)

Index

Level

Chg (%)

UK Market

6669.46

-0.17

Gold Price

1341.36

+0.62

Dow Jones

18347.67

+0.66

GBP/USD

1.3240

+0.30

S&P 500

2152.14

+0.70

GBP/EUR

1.1988

+0.12

Nasdaq

5022.82

+0.69

EUR/USD

1.1045

-0.42

Nikkei 225

16231.43

+0.84

USD/JPY

104.27

+0.61

Hang Seng

21322.37

+0.46

ZAR/GBP

19.09

-0.47

Oil Price

46.24

-1.20

ZAR/USD

14.42

-0.77

GLOBAL MARKETS UPDATE

RISERS & FALLERS

European shares mixed this morning, after earlier inching closer to levels before the Brexit vote. The ESTX 50 (-0.22%), Dax (-0.32%) and the UK markets (-0.22%) all posted losses in early trading, while the CAC 40 (+0.08%) was up. Miners led gains among industry groups, with Anglo American Plc and Glencore Plc up more than +2%. Burberry Group Plc rose +2.2% after it reported first quarter retail sales that beat analysts’ estimates. Accor SA added +3.8% after announcing plans to separate its HotelInvest unit and eventually sell a majority stake in the subsidiary to free up funds for the parent company to expand and improve existing lodgings. Nokia rose +4.4% after raising its sales forecast and announced a licensing agreement with Samsung.

US stocks rallied, with a sharp rebound in crude prices boosting energy shares, while the Nasdaq turned positive for the year. The Dow Jones Industrial Average (+0.66%), S&P 500 (+0.70%) and the Nasdaq Composite (+0.69%) all increased. Cyclical sectors like technology, materials and energy posted the largest gains on the S&P, backed by the view that the US economy, despite a slow start to the year, is on solid footing. Alcoa cemented hopes for better earnings as its profit and sales both beat market expectations. The stock closed +5.4% up. United Continental jumped +8.8% after saying its quarterly passenger unit revenue would drop less than expected. Seagate jumped +21.8% on strong preliminary results. Western Digital rose +4.8%.

Asian stocks rose as Japanese shares erased their Brexit losses after the yen extended declines, while commodity producers rose with oil. The S&P/ASX 200 (+0.66%), Hang Seng (+0.46%) and the Nikkei 225 (+0.84%) all increased. China Petroleum, also known as Sinopec, climbed +1.6% in Hong Kong and China Oilfield Services Ltd gained +1.3% after US crude futures jumped 4.6%. China Construction Bank Corp and China Citic Bank Corp, whose H shares offer a dividend yield of at least 5%, added +1.3%. Both stocks are valued at less than 5.1x their reported earnings. Bestway Marine climbed +2.4%, while Avic Aero-Engine Controls Co rose +1.2%.

.

Antofagasta Plc

+3.81%

Burberry Group Plc

+3.74%

Aviva Plc

+3.12%

Glencore Plc

+2.31%

BHP Billiton Plc

+2.14%

Barratt Developments

-3.90%

Berkeley Group

-2.49%

Taylor Wimpey Plc

-1.93%

Diageo Plc

-1.78%

Persimmon Plc

-1.74%

COMMODITIES

Oil industry hopes that markets are about return to balance, ending a global glut that pulled down prices by over 70 percent between 2014 and early 2016, might be abruptly dashed.

The global glut in oil is refusing to ease and acts as a major dampener on crude prices despite robust demand growth and steep declines in non-OPEC production, the International Energy Agency said on Wednesday.

Global oil and shipping markets reacted nervously on Tuesday after an international arbitration court ruled against Beijing's claims across large swathes of the South China Sea, fuelling geopolitical tensions in the vital waterway.

Construction starts for new nuclear reactors fell to zero globally in the first half of 2016 as the atomic industry struggles against falling costs for renewables and a slowdown in Chinese building, a report on the industry showed on Wednesday.

INTEREST RATES FORECAST

Currency

Current

Q3-16

Q4-16

Q1-17

Q2-17

US Dollar

0.25-0.50%

0.25-0.50%

0.75%

1.00%

1.00%

Euro

0.00%

0.00%

0.00%

0.00%

0.00%

Sterling

0.50%

0.50%

0.50%

0.50%

0.50%

BUSINESS NEWS

Discount chain Poundland has agreed to a £597m takeover by South African retail group Steinhoff International. Steinhoff is paying 222 pence per share for the discount retailer. Steinhoff had made an informal approach for Poundland last month, but the offer was rejected.

Burberry has reported a 3% fall in like-for-like sales and flat retail revenues of £423m after what it called a "challenging" first quarter. On Monday, Burberry announced chief executive Christopher Bailey would be replaced after two years in the post. The results indicate the task ahead for his replacement Marco Gobbetti, who will join the company next year.

Airbus has more than halved its delivery target for its super-jumbo A380 planes.The company said it would supply 12 of the aircraft per year from 2018, down from the 27 it delivered in 2015.