The European session is experiencing low volatility this morning as the macroeconomic picture hasn’t changed much.
The FTSE 100 is holding above the psychologically important 7,000 mark, but volatility remains low across the board. Since China is celebrating the Lunar New Year we could be in for a quiet week. Traders haven’t forgotten about the US-China trade dispute or the Italian recession, but for the moment they seem content to sit on the side-lines.
Ryanair (LON:RYA) shares are in the red today after the company confirmed it suffered a net loss of €19.6 million in the third-quarter. The passenger numbers grew by 7.5% and revenue jumped by 9% in the period. The company blamed higher oil price and lower fares for the drop in profit. The sector has become more competitive recently, but Ryanair haven’t done themselves any favours with industrial disputes and the pilot roster fiasco. The airline is often quick to cut fares to draw attention any from negative headlines, but that it’s eating into their bottom line. If they treated their staff and customer better they wouldn't have to resort to cutting prices.
Flybe (LON:FLYB) shares have sored today after it was reported that Andrew Tinkler, former Stobart CEO, expressed interest in the airline. Virgin Atlantic seemed like the only bidder, and now Mr Tinkler appears to be a contender. Until recently, Virgin were the only interested party, and there was a feeling the bid was particularly low, and now the talk of Mr Tinkler putting in a bid, has lifted the struggling stock this morning.
Ferrexpo (LON:FXPO) cautioned that its full year results might not be published on time as the group is investigating payments to a charity. The firm’s auditors, Deloitte, described the proof of payments to the charity as ‘unexplained discrepancies’. The mining company warned that annual earnings would fall by roughly 10% as weaker sales and higher cost hit the firm.
GBP/USD is in the red as a continued lack of clarity in relation to Brexit. The UK construction PMI report slipped to 50.6 in January, down from 52.8 in December. It was the lowest reading in 10 months, but the decline in activity isn’t a surprise given the uncertainty surrounding Brexit.
Eurozone annual PPI slipped to 3% from 4%, while economists were expecting 3.2%. EUR/USD is in the red this morning.
Gilead Sciences (NASDAQ:GILD) will be in focus today as the company is expected to release its fourth-quarter results. In October, the group said that third-quarter revenue and profit fell by 14% and 22% respectively. The company suffered a large drop in sales of hepatitis C drug sales, and investors will be keeping an eye on the performance of that division.
We are expecting the Dow Jones to open 5 points higher at 25,068 and we are calling the S&P 500 up 1 point at 2,708.
DISCLAIMER: CMC Markets is an execution only provider. The material (whether or not it states any opinions) is for general information purposes only, and does not take into account your personal circumstances or objectives. Nothing in this material is (or should be considered to be) financial, investment or other advice on which reliance should be placed.
No opinion given in the material constitutes a recommendation by CMC Markets or the author that any particular investment, security, transaction or investment strategy is suitable for any specific person.