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FTSE rises ahead of US jobs, but Marks & Spencer falls on downgrade

Discussion in 'Market News' started by Lily, Jun 3, 2016.

  1. Lily

    Lily Forum Member

    Aug 29, 2015
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    Commodity companies climb but retailer hit as analysts slash price target

    Leading shares are heading higher amid a flurry of service sector data and ahead of the US non farm payroll numbers.

    Commodity companies are among the leading risers as oil holds firm around $50 a barrel despite Opec deciding not to implement output cuts. BP is 8p better at 361.1p, as it agreed to pay $175m to settle claims by US investors relating to the 2010 Gulf of Mexico oil spill, removing the last major legal threat from the disaster.

    London’s blue chip index is following leads set by both the US and Asia with some decent gains coming through at the open, although it’s difficult to see them as being all that convincing – at least for now. The big economic release today is the US non-farm payrolls and this could prove somewhat instrumental in determining just how we finish the week. There’s a nagging doubt that the Federal Reserve will be in a position to hike interest rates this month and any notable shortfall in today’s employment stats would have the potential to kick this idea very much into the long grass.

    The vast majority of equities in London are finding some degree of positive territory this morning – rising oil prices and this doubt over US rate hikes is helping commodity stocks towards the top of the board.

    Cussons’ shares have risen 37% since the interim results announcement on 26 January. Helped by a 57% increase in the oil price over the same period (given the company’s Nigerian exposure), the shares have outperformed the FTSE 250 index by 31% in the process. We think risk from the scheduled full year trading update on 9 June is no better than equally weighted (with April’s update stating that performance “overall...has been in line with expectations”), and would take profits in the light of the rerating and the lack of a near term catalyst.

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