Summertime Sadness

Markets & Weather comparably volatile

Tuesday, 6 August: After an unsurprisingly rough session on Wall St. yesterday global sentiment had seen little change going into Tuesday’s session for Asian bourses and it was another tough session as the Nikkei (-0.65%) shed alongside the Hang Seng (-0.67%). The main story of the day was unseasonal volatility. At the European opening bells markets were mixed but the FSTE quickly fell 0.5%, not helped by the pound having a fairly strong start to see gains vs the dollar and euro, albeit from a relatively low base.  As the session progressed towards lunch the FTSE had pared losses and was modestly higher, spurred by the People’s Bank of China (PBOC) decision to fix the yuan higher than expected. As Wall St. opened to a recovery, and the majority of Euro bourses were holding gains the FTSE once again slipped, seemingly hampered by a stronger pound which is currently 0.55 up vs the euro. The index eventually closed 0.72% lower, with the S&P 500 and Dow currently 0.5% higher.

The main index wasn’t helped by unfavourable results from Rolls-Royce and InterContinental Hotels either, with the former seeing shares drop to the bottom of the FTSE, losing 6.9% on the day. Rolls-Royce narrowed their pre-tax loss in the opening half of the year and backed full year guidance but they’re still evidently plagued by engine problems.

InterContinental Hotels saw a pre-tax profit climb of 25% in the first half as higher revenues helped the firm. But revenue per room fell short of expectations and this led shares to a 2% decline today.

Dominos Pizza saw a first-half profit decline of 27% hit from challenging international markets as well as slowing demand in the UK (which has nothing to do with me). They also announced their CEO will retire. It is believed the replacement CEO will tackle complex issues with the domestic franchise set-up. Shares climbed 1.7% during the day.

Industrial equipment manufacturer Rotork saw shares jump 7.6% today as higher margins offset anticipated an sales decline.

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