Share Trading

European markets faced a rather quiet session yesterday so many will be pleased to see some data due for release this morning to get their teeth into.

The markets trade balance figures will be the early focus as for the UK markets, but there is no doubt that the markets will soon focus on the Fed and the possibility of a change in language and a possible new QE program.

Language will be important as the FOMC meeting takes place with some officials of the opinion that the “extended period” comment should be removed as a more hawkish tone is adopted by some.

However with the weaker economic figures over the last few weeks it is widely thought that the a new program of QE will be adopted in order to stave off the much talked about double dip recession.

So we can at least say today that we have something to get our teeth into, and with the inflation report and UK unemployment later in the week we could in fact see things get particularly busy in the spread trading markets.

The hotel trade is showing signs of recovering from the effects of the recession, and not just at the budget end of the market, and so results from InterContinental Hotels should show the Holiday Inn owner’s fortunes on an upward trend. The group’s US peers have all topped market expectations with their second quarter earnings recently, which has set the bar a little higher for InterContinental.

Also in the share trading markets, Interim results from power generator International Power have been nicely timed with the market waiting with breath abated for news of its multi-billion pound merger with French electricity giant GDF Suez. Negotiations over the last few details were underway over the weekend and a formal announcement is expected alongside Tuesday’s results.

Reports said there are still some wrinkles to sort out but the basic framework has been agreed. The deal will see the French state-owned GDF take a majority stake in the enlarged group, possibly as much as two-thirds. The remainder of the shares will be listed in London.

The British Retail Consortium (BRC) brings out its retail sales monitor for July and with the weather having been generally fine total retail sales should be up year on year with forecasting unit I H S Global Insight going for a rise of 3.7%, or 1.5% on a like for like basis. That compares to gains of 3.4% and 1.2% respectively in June.

Share Trading Markets

Ahead of the open we expect to see the FTSE down 14 points at 5,397, the DAX up 3 points at 6,355, and the CAC up by 10 points at 3,787.

CFDs, FX and Spread Trading are leveraged products and carry a high level of risk to your capital. It is possible to lose more than your initial investment. These products may not be suitable for all investors, therefore ensure you understand the risks involved and seek independent advice if necessary.

By James Hughes, Analyst, CMC Markets.

Tax treatment depends on the individual circumstances of each client and may be subject to change in the future.

This material should not be construed in any circumstances as a recommendation or offer to sell or recommendation or solicitation of any offer to buy any security or other financial instrument

The material is not a personal recommendation and you should seek independent advice as to your suitability to speculate in any related markets and your ability to assume the associated risks if you are at all unsure, as well as confirming the legal, tax and accounting characteristics and consequences of any transaction.