I would like to call today’s session a roller coaster ride – with the FTSE down 35 points mid-morning and now up 37 at the day’s high point at 6336 at 3.00pm. But in all fairness in comparison to the last few weeks the spread of 72 points on the day’s trading is but a mere bagatelle.
After recent seismic rallies in the last few weeks, it was a question of call for the Rennie’s to fight off the threat of indigestion. Some might say that the market was overbought. Who knows? All I will say ahead of Friday, when Alcoa reports at the start of the 3rd quarter US earnings period, is that not too much is expected from this quarter – profits could be down by an average of 5%. Also my good friend and colleague Simon French, Panmure’s economist, tells me that over the past 4 years EPS for FTSE 100 companies has fallen by 31%, despite 62% of companies forecasting there would be increases. So a degree of caution should be maintained. Vigilance is the name of the game.
The oil sector was up 2% on the day with BP, after an unexciting start, was 2% to the good despite a downgrade from S&P. There was overall relief that the Macando Saga was in sight of being ‘done and dusted.’ Miners put in varying performances but on average were up 1.5%. Glencore kept its poise – up 1%. Drugs were in a quiet place, though BTG was the subject of dispiriting news – down 9%. EasyJet’s efforts in September, laudable though they were, they were not as good as Ryanair’s yesterday. Ted Baker’s saw sales up 25% and shares initially rose 1.5% but profit takers and the outlook brought them back to reality – down 3.5%. Amazing – Greggs – sausage roll makers to kings and Queens was up 9% on the back of good numbers. Robert Walters was on the back foot from the bell – -3%. It is 3.00pm at the time of writing. Tesco, ahead of tomorrow’s update were up 3.5%. Sales are expected to be down 1.5% in the last 6 months – better than 4.6% down in the corresponding period last year.
The DOW is up 20 points having been up 60 points 20 minutes ago.