Stock markets in Europe are higher this morning as traders feel the Federal Reserve will lower rates in the wake of the update from Fed chief, Jerome Powell yesterday. The central banker said the Fed would ‘act as appropriate’ to help the US economy, and he cautioned that ‘crosscurrent’ have weighed in the country’s outlook. Mr Powell highlighted that the unemployment rate is near a 50 year low, but he did leave the door open to cutting rates, and that acted as s green light to the bulls.
Indivior (LON:INDV) shares surged this morning after the company upped its full-year revenue and profit guidance. The previous guidance for revenue was for between $525 million and $575 million, and now it has been increased to between $670 million and $720 million. The profit guidance is for between $80 million and $130 million, which is a considerable increase on the old guidance, which was for between a loss of $40 million to a profit of $10 million. The group’s Suboxone drug is outperforming its rivals. It was also announced today, that Reckitt Benckiser, the former owner of Indivior, paid a $1.4 billion fine from the US Department of Justice in relation to how Suboxone Film was marketed when it owned the product.
Dart Group (LON:DTG) confirmed that full-year pre-tax profit jumped by 36%, and the firm expects to meet next year’s target. Revenue jumped by 32% too. The numbers were impressive given the wider travel sector has been relatively weak, and the fact that earnings are higher, indicates the sector is in better shape than previously thought. Dart did express concerns about operating costs and fuel expenses, but it remains confident in its travel and distribution business. Dart Group shares are higher this morning, and Thomas Cook Group are higher too.
McBride (LON:MCB) shares sold-off after the company issued a broadly disappointing update. The group said that full-year adjusted earnings will be largely in line with market expectations, but the earnings for the year 2020 are expected to be slightly lower that the 2019 figures. The share price has hit hard by profit warnings in February and May, and today’s announcement has put additional pressure on the stock.
EUR/USD has been assisted by the dip in the US dollar on the back of the comments from Jerome Powell yesterday. The central banker will be speaking in at 3pm (UK time) time. French and German CPI came in at 1.4% and 1.5% respectively, and economists were expecting 1.4% and 1.3% respectively.
The Bank of England said the perceived likelihood of a no-deal Brexit has increased, but it also said that UK banks are still resilient. GBP/USD is higher this morning.
Bed Bath & Beyond (NASDAQ:BBBY) will be in focus today after the company reported first-quarter results after the closing bell last night. Adjusted earnings per share dropped by 68% to 12 cent, but the consensus estimate was 8 cents. On an annual basis, revenue dropped by over 6%, and was fractionally below traders’ forecasts. Same store sales dropped by 6.6%, and dealers were only expecting a 5.6% fall. The group is under pressure from activist investors, and it is reviewing its portfolio brands and stores.
We are expecting the Dow Jones to open 80 points higher at 26,940 and we are calling the S&P 500 up 9 points at 3,002.
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