Even though tensions between the US and Iran remain high, sentiment in equity markets has turned positive, as European indices are showing modest gains this morning. The fact US markets ended yesterday’s session higher paved the way for buying in Asia overnight as well as in Europe this morning. The gains might be limited seeing as the political situation is far resolved but it would appear that some of the fear has evaporated for now.
Aston Martin (LON:AML) shares have tumbled on the back of a profit warning. The high-end automaker has had a rough ride in recent months as the stock was hammed in July when it issued a profit warning. The firm had a ‘disappointing’ year, and it now predicts that full-year earnings will be £130-£140 million, which would be a major drop off from the £247.3 million posted last year. The European division underperformed in terms of volumes. Aston foresees that margins will be squeezed to be between 12.5% and 13.5%. The stock has been under pressure lately, and while it remains below the 50-day moving average at 506p, the bearish trend is likely to remain in place.
Morrisons' (LON:MRW) shares are a little higher this morning as the company announced it expects full-year profit before tax to be in line with current expectations, even though the supermarket group revealed a 1.7% fall in group like-for-like sales excluding fuel for the 22 week period until early January. Excluding fuel, total sales were down 1.8% for the period. The group’s CEO claims the firm is ‘well set for 2020.
888 Holdings (LON:888) issued a positive trading update as the group expects to achieve it target in terms of earnings. The gaming company confirmed that poker has ‘remained challenging’, but on a more optimistic note it said it entered 2020 with ‘good momentum across serval regulated markets’. The announcement was light on details so there was little for traders to sink their teeth into.
As far as traders are concerned, Safestore (LON:SAFE) continues to be a safe pair of hands as full-year underlying earnings increased by 5.5%, and LFL average occupancy for the year increased by 3.5%.
The headline eurozone CPI rate jumped from 1% to 1.3% - meeting forecasts, while the core reading remained unchanged at 1.3%. It is encouraging to see that headline inflation is on the rise in the region, but it is still a long way off from the European Central Bank’s target of close to 2%. On a month-on-month basis, retail sales jumped by 1%, which was a big improvement on the 0.3% decline in October. EUR/USD's reaction was muted.
We are expecting the Dow Jones to open 7 points higher at 28,710 and we are calling the S&P 500 up 1 point at 3,247.
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