European equity markets are quiet this morning due to a lack of major macroeconomic news. Volatility is likely to be low as traders await the US Federal Reserve meeting this evening.
Glencore (LON:GLEN) shares are higher today after the company settled a dispute with a partner in the Democratic Republic of Congo (DRC). The London-listed miner agreed to a $5.6 billion debt-for-equity swap in order to protect a business in the DRC, which has the potential to become the largest cobalt operation in the world. Batteries in smartphones and electric cars require cobalt, and that is why the mineral is in such high demand. Shares in Glencore are up 2.3%.
Just Eat (LON:JE) shares are in the red after Deliveroo revealed plans to sign up 5,000 eateries yesterday. Deliveroo is planning on ramping up the number of employees it has, and it will give restaurants with their own delivery staff the option to use its drivers at peak times. Investors are concerned the aggressive expansion plans by Deliveroo will take a bite out of Just Eat’s market share. The stock has been broadly pushing higher for over four years, and if it can hold above the 200-day moving average at 766p, it could target 900p.
Dixons Carphone (LON:DC) has confirmed that hackers accessed the card details of 5.9 million of its customers, and the personal data of an additional 1.2 million clients. The company announced there is ‘no evidence of any fraud’ as a result of the incident. The group suffered a cyber-attack in 2015 where more than 3 million Carphone Warehouse clients had their data accessed. The data breach has knocked investor confidence, and the stock is lower.
Tesla (NASDAQ:TSLA) shares will be in focus today after the company revealed plans to trim the workforce by 9%, and the bulk of the cuts will be in office-based jobs. The aim of the move is to flatten the management structure.
GBP/USD is lower today and the mediocre inflation figures from the UK are unlikely to spur buying. The latest CPI report showed the cost of living held steady at 2.4%, while economists were expecting a reading of 2.5%.
EUR/USD is in the red after the latest eurozone industrial output showed a decline of 0.9% on a monthly basis, while the consensus estimate was for -0.5%.
The Fed will release its interest rate decision at 7pm (UK time), and traders are widely expecting a rate hike of 0.25%. The press conference at 7.30pm (UK time) will be the highlight of the evening. At the start of the year there was speculation there would be four rate hikes from the Fed in 2018, and that is still a possibility. Dealers will be listening out for clues about future monetary policy.
We are expecting the Dow Jones to open down 9 points at 25,311 and we are calling the S&P 500 flat at 2,787.
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