There’s been more downside seen in stocks across Europe this morning with the FTSE 100 sliding to its lowest level in over a fortnight. The recovery seen in the second part of last month is now under threat and this afternoon’s US jobs report presents a sizable event risk heading into the weekend. The pound is on track for a solid week of gains with only the resurgent US dollar outperforming sterling. The largest appreciation can be seen against the antipodean currencies with a rise in excess of 2% for the GBP/AUD and GBP/NZD
US employment data could be key
The main theme this week for markets is the rise in US yields with solid jobs and bumper service sector figures on Wednesday pushing bonds down further with the 10-year hitting its lowest level since 2011.
This afternoon’s non-farm payrolls (NFP) is the most widely viewed employment figure around the globe and another strong release could push yields even higher, supporting the buck and posing a threat to stock markets. There was sizeable selling seen across all major stock benchmarks yesterday but the US recovered a little into the closing bell and today’s moves following the jobs data could well set the tone for the markets for the rest of the month.
UK house prices fall by most since April
Figures from mortgage lender Halifax show that British house price fell at their fastest pace last month since April, as the market remains jittery with just 6 months to go before Britain is set to leave the EU. A decline of 1.4% for the month of September follows a drop of 0.2% in August and. It should be pointed out that other lenders such as Nationwide have shown better figures for the month of September, but it is clear that the pace of growth overall has clearly slowed and news just last weekend that Theresa May plans to increase taxes on foreign buyers will not help the demand side of the market.
Unilever (LON:ULVR) decides against HQ move
News that Unilever has decided against plans to scrap its dual-listed structure and move its headquarters to the Netherlands comes as a particularly pleasing development for UK shareholders. The stock will now continue to be listed in both London and Amsterdam and will also likely be claimed as a victory for the UK by Brexiteers. The firm makes popular British products like Marmite and the decision to move its headquarters out of London was seen by some as a rejection of the country post-Brexit. Shareholders were concerned that the move would result in the stock being demoted from the FTSE and therefore lead to selling due to redemptions from funds that passively track the blue-chip index.