Halloween Comes Early for Markets

Thursday, 3 October: To nobody’s surprise the sell-off continued through the session on Wall St. yesterday and Asia followed suit overnight through to the European open. After one of the worst days for a long time it was unlikely the FTSE would fall considerably further at the open, but there was no offer of a reverse in sentiment. The main index in London closed 0.6% lower today, falling further after the pound actually regained some losses following a disappointing services PMI. Staying with that, earlier we expected a read of 50.0, which cuts the line between expansion and contraction but for September the UK read was 49.5, in context this was down from August’s 50.6. Nothing sensational but last month we still at least hung onto some growth. The pound also manged to get a leg up on the dollar, given the turmoil in the states that has the White House thinking Halloween has come early. As we write US markets are holding strong, the Dow the only major bourse in the red thus far.

Back closer to home some of the main headlines today involved Ted Baker, who saw shares plummet over 40% after a further profit warning. The problems at the fashion retailer far deeper than wide-spread high street woes. The interim dividend was also slashed to boot.

Imperial Brands have announced their CEO will depart as the brand looks to recover some sentiment amid turbulent times for both them and the wider industry. Tobacco is structurally declining and so many firms looked to what the future landscape of the industry would look like, they turned to e-cigarettes and well, that dream looks to be up in smoke. Pardon the pun. The recent accusations against the once thought healthy alternative to traditional tobacco has the industry flapping, and Imperial will look for a brave and pioneering new leader to hopefully navigate a path through. Shares on the day ended 0.55% higher.

A number of miners were in focus today, as Anglo announced their majority owned De Beers group has seen a slight rise in rough diamond sales over the last cycle and Centamin announced their CEO would be departing, whilst also claiming a full year production target was still achievable despite Q3 underperforming.

Diageo was also in focus, and their shares sat close to the top of the FTSE throughout the session after better than expected tariffs from the US. Analysts had expected export tariffs to be both harsher and across more drinks, hence despite the fact they will have an adverse impact it will not be s bad as feared.

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