Stock markets are subdued this morning in the wake of the enormous losses that were registered yesterday. Unfortunately the coronavirus situation has worsened as the Chinese government has confirmed the death toll has risen, as well as the number of confirmed infections.
The fact there isn’t much bargain hunting or short covering going on this morning suggests that dealers are still fearful the health crisis is likely to get worse before it gets better. Despite enduring big losses yesterday, some mining companies like Antofagasta (LON:ANTO), BHP Group (LON:BHPB), and Anglo American (LON:AAL) are in the red again – which highlights the bearish sentiment surrounding the China-linked mining sector.
A.G.Barr (LON:BAG) shares jumped on the back of a positive trading update. The drinks company confirmed it ended the year with ‘encouraging trading momentum’, in addition to that, the firm expects full-year adjusted pre-tax profit to be at the top-end of market expectations. Keep in mind the share price was rocked in July on account of a profit warning. One of the reasons for the poor update in the summer was there were issues with brands like Rubicon and Rockstar, but now recovery plans are ‘being implemented’. The company has completed the first phase of the ‘business re-engineering’ programme’. It seems as if the firm is finally turning around, hence why the stock has jumped.
Crest Nicholson (LON:CRST) posted disappointing full-year numbers, but the group confirmed there were ‘encouraging signs’ since the UK general election – where the pro-business Conservative party won a large majority. Annual full-year pre-tax profit fell by 39% to £102.7 million, while house completions slipped by 4%. On the bright side, the home builder said the traffic on the website is higher and the footfall at developments has risen. Traders have latched on to the slightly optimistic outlook, which is why the stock is higher.
Home builder McCarthy & Stone (LON:MCS) also expressed optimism in relation to business in January. Like Crest Nicholson (LON:CRST), the firm saw a slowdown in client interest ahead of the UK general election, but things have picked up in 2020. Annual revenue increased by 8% while underlying pre-tax profit ticked up by 2%. The yearly dividend pay-out was left unchanged at 5.4p, which is good indication the company is confident in its outlook.
Sainsbury's (LON:SBRY) has revealed plans to cut their net carbon emission to zero by 2040. A sizeable portion of the group’s emissions are from the supply network, but the supermarket chain will be contacting its suppliers to ensure they are ‘playing their part’. It is a nice publicity tactic but the move is unlikely to drive up profits.
An absence of important economic reports from Europe has led to low volatility in EUR/USD as well as GBP/USD.
Apple (NASDAQ:AAPL) will reveal its first-quarter figures tonight when the US market is closed. It the latest quarterly update, the tech giant confirmed that iPhone sales slowed, but more revenue was derived from the services section of the business, so traders will be wondering if this will be a common theme. In the update, we will get to find out how popular the AppleTV+ service is, and what are its prospects.
We are expecting the Dow Jones to open 75 points higher at 28,610 and we are calling the S&P 500 up 7 points at 3,350.
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