50% Off! Beat the market in 2025 with InvestingProCLAIM SALE

Stocks Slip, Ignore Elections Ahead Of NFP; Steel In Focus

Published 06/05/2016, 12:14
Updated 03/08/2021, 16:15
NDX
-
UK100
-
XAU/USD
-
US500
-
DJI
-
JP225
-
RIO
-
ISA
-
RRS
-
MT
-
GC
-
HG
-
TISC
-
BRKa
-
6502
-
HRCc1
-

Markets were lower on Friday, showing typical caution ahead of the monthly US unemployment report as some European stock exchanges came back online having been closed for Ascension Day.

The FTSE 100 was down around half-a-percent by mid-morning. A good showing for the generally more market-friendly Conservative Party in local elections has had little bearing on sentiment. A Labour Party wash-out that some were forecasting might have garnered a bigger market reaction.

A rebound in the price of gold off yesterday’s lows has helped gold-miner Randgold (LON:RRS) to the top of the UK benchmark whilst Inmarsat (LON:ISA) sank for a second day, leading the decliners.

Rio Tinto (LON:RIO) dropped over 1%, modestly outperforming a broader fall across the mining sector after confirming plans to invest into the Oyyu Tolgoi copper mine in Mongolia. There is some scepticism over the timing of the investment when copper prices sit near decade-lows. What’s worth considering is that this is one of the best under-developed projects. Initial production would start in 2020, by which time a shortage of copper supply from a pullback in capex across the industry is likely to have pushed copper prices higher.

Shares of ArcelorMittal (LON:0NSF) are lower after the world’s largest steel company posted another loss while forecasting a ‘fragile’ rise in steel demand. Excalibur Steel is speaking with bankers for funding to buy Tata Steel's (NS:TISC) UK operations. Bank-supported funding would address one of the major obstacles to Excalibur’s bid but plans to offload the pension scheme to the taxpayer-backed PPF likely needs to be scrapped before a deal would be acceptable. Liberty House looks like a more stable buyer than the make-shift consortium of management and other interest partiers. The risk with Liberty House is that it ends up being more of the same failed approach.

Japan’s Nikkei dropped for a sixth straight session, its worst run since the global sell-off at the start of the year. There was some optimism surrounding the appointment of a new CEO at Toshiba (T:6502). Mr Tsunakawa did well at Toshiba’s healthcare unit and his detachment from the accounting scandal means he can bring an untainted perspective along with an understanding of the business.

US markets look set for lower start before non-farm payrolls with Warren Buffet’s Berkshire Hathaway (NYSE:BRKa) set to report earnings.

USA pre-opening levels
S&P 500: 4 points lower at 2,046
Dow Jones: 39 points lower at 17,621
Nasdaq 100: 10 points lower at 4,299

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.

Original post

Latest comments

Loading next article…
Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.