Greg Secker – U.K. Market update brought to you by Traders University

 UK Stock Market Report 29th July 2010 

UK Stock Market Report 28th July 2010

The FTSE 100  index closed up 14.55 points at 5,365.67
A leading think-tank will say today Britain will avoid sinking into a double-dip recession and its economy will be expanding at trend growth rates as early as 2012, adding to the increasingly rosier outlook for the UK and defusing fears of further economic contraction. The National Institute for Economic and Social Research in its latest forecast for the UK economy predicts GDP growth of 1.3 per cent this year, 1.7 per cent next year and acceleration to 2.2 per cent in 2012. Strong economic data over the past week, culminating in an extremely positive retail sales report from the CBI, yesterday pushed the pound to a five-month high of $1.5585. The CBI said that a net 33 per cent of retailers were reporting rising rather than falling sales compared to last July and are even more optimistic about the prospects for August. The survey boosted analysts’ hopes that the UK can achieve further decent growth in the third quarter.
New figures suggested taxpayers will shell out up to £1bn extra over the next 30 years to pay for PFI projects, while the state struggles to reverse a decline in productivity bringing public spending under fresh scrutiny yesterday. The running costs of Private Finance Initiatives (PFI) agreed during the credit crisis will be between £500m and £1bn, said the National Audit Office (NAO), though it said the schemes represented good value for money for boosting the economy.

Due for release today
GBP BOE Gov King Speaks                        9.30am
USD Core Durable Goods Orders m/m    1.30pm
NZD Official Cash Rate                         10.00pm
NZD RBNZ Rate Statement                     10.00pm

UK Stock Market Report 27th July 2010

The FTSE index closed 38.50 points higher on Monday at 5,351.12

Banks and insurers could be forced to pay to comply with the biggest overhaul of financial regulation in a decade, because they will have to deal with two regulators instead of one. The government made the admission as it began a three-month consultation on plans to scrap the Financial Services Authority and replace it with two new regulators, a Prudential Regulation Authority (PRA) and the Consumer Protection and Markets Authority (CPMA). The government said between 1,500 and 2,000 mostly banks and insurance companies are “likely to incur transitional costs in making arrangements to deal with two regulators rather than one”. It also warned of “higher ongoing costs”. The overhaul is expected to set the taxpayer back by around £50m.

Business Secretary Vince Cable has warned a tax on profits could be an option for British banks they if they paid excessive dividends and bonuses and did not promote lending to smaller businesses.  While launching a consultation document on how to get more money flowing to businesses, Cable said that a tax on bank profits was one of the sticks that might be used to boost lending. ”The FSR estimates that if UK banks limited bonus and dividend payouts to pre-crisis and 2009 levels respectively, the major banks could generate around £10bn of additional capital over 2010, which could in turn sustain £50bn in new lending,” said the document, co-authored by Cable’s department and the Treasury.

Due for release today

USD CB Consumer Confidence 3.00pm

UK Stock Market Report 20th July 2010

The FTSE 100 closed down 10.57 points, or 0.2 percent, at 5,148.28, having previously shed 1 percent on Friday.

 David Cameron, has indicated his new Conservative-Liberal Democrat coalition will approach the U.S.-UK relationship pragmatically, working together on common areas without wanting to  be to slavish to American interests. Cameron said. “The alliance is not sustained by our historical ties or blind loyalty. This is a partnership of choice that serves our national interests.”

An Indian-based oil and gas exploration company, JUBILANT Energy is reportedly considering a flotation on the London Stock Exchange. There are suggestions that the company could be valued at up to £1bn and the  flotation would look to raise around £300m on the London markets.

London Underground staff will start voting today on whether to launch a strike which would hit millions of commuters. The dispute is over job security for ticketing workers who currently face up to 800 job cuts and the closure of 240 ticket offices as commuters increasingly use electronic ticketing options.

Due for release today;
US  Building Permits  1.30pm BST
CAD  BOC Rate statement  2.00pm BST
CAD  Overnight Rate   2.00pm BST

UK Stock Market Report 13th July 2010

The FTSE 100 is currently up 34.08 point at 5,167.02.

Yesterday, George Osborne’s bid to get the UK’s spiralling Budget deficit under control was dealt a blow as Standard & Poor’s (S&P) warned Britain remains at risk of losing its triple-A rating. The credit rating agency said it was keeping its negative outlook on the UK’s debt despite Osborne’s austerity Budget, it also warned the economy was unlikely to grow at the pace forecast by the OBR. “Standard & Poor’s medium-term economic forecasts for the UK are less optimistic than the assumptions underlying the Budget. We therefore believe there is still a material risk that the UK’s net general government debt burden may approach a level incompatible with the ‘AAA’ rating,” S&P said in a statement. In the minutes immediately after the announcement the pound fell to $1.5017 as the credit rating agency’s move triggered fears over the coalition government’s grip on the economy.  After a week of taking office, Osborne announced £6bn of emergency spending cuts.

Due for release today is the GBP CPI y/y/, EUR German ZEW Economic Sentiment, CAD Trade Balance, USD Trade Balance, NZD Retail Sales m/m and RBA Gov Stevens Speaks.