CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 75% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.
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Business news: Markets recover from US CPI data

By Jenny McCall

15:13, 13 January 2022

A picture of a shopping basket with food on an arrow
The 7% year-on-year US inflation reading was the highest since 1982 - Photo: Shutterstock

Key points

  • The number of US citizens filing new claims for unemployment benefits has risen in the last week as Covid-19 infections also increased. Claims for state unemployment benefits rose to a seasonally adjusted 230,000 for the week ended 8 January, the US Labor Department announced today.
  • Global financial markets started to stabilise today after the US reported its highest reading for inflation in nearly 40 years. The 7% year-on-year US consumer price inflation reading was the highest since 1982, leading many to think that the US Federal Reserve will have no choice but to tighten monetary policy.

Top business and economic news today

  • The stock prices for both Tesco and Marks and Spencer fell in early morning trading, even though the retailers reported better-than-expected Christmas sales. Investors still showed concerns over inflationary pressures that may impact retail sales in the next few months.
  • Delta Air Lines rose over 2% today after the airline beat estimates for the fourth quarter.

Markets this week:

  • Stocks: UK stocks were down today, with major supermarkets falling in early morning trading.
  • Oil: Oil prices eased today. Brent crude was trading at close to $85 a barrel.
  • Gold: Gold prices were steady on Thursday, as investors waited for more clues as to whether the US Federal Reserve will hike rates due to high inflation.
  • Forex: The dollar continued to slip toward a two-month low, and the euro was up 0.3% today, as currencies reacted to the Consumer Price Index data from the US.
  • Crypto: Bitcoin fell 0.54% today, and ethereum also dropped 0.02% in early morning trading.

What to watch this week:

  • Investment bank JPMorgan will release its fourth-quarter earnings tomorrow. 

Read more: Will 2022 be the comeback year for UK hospitality sector?

Markets in this article

Oil - Brent
Brent Oil
80.432 USD
-0.354 -0.440%
BTC/USD
Bitcoin / USD
65835.35 USD
-105.45 -0.160%
DAL
Delta Air Lines Inc (Extended Hours)
43.60 USD
-0.44 -1.010%
ETH/USD
Ethereum / USD
3444.48 USD
-43.13 -1.240%
EUR/USD
EUR/USD
1.08524 USD
-0.00017 -0.020%

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The difference between trading assets and CFDs
The main difference between CFD trading and trading assets, such as commodities and stocks, is that you don’t own the underlying asset when you trade on a CFD.
You can still benefit if the market moves in your favour, or make a loss if it moves against you. However, with traditional trading you enter a contract to exchange the legal ownership of the individual shares or the commodities for money, and you own this until you sell it again.
CFDs are leveraged products, which means that you only need to deposit a percentage of the full value of the CFD trade in order to open a position. But with traditional trading, you buy the assets for the full amount. In the UK, there is no stamp duty on CFD trading, but there is when you buy stocks, for example.
CFDs attract overnight costs to hold the trades (unless you use 1-1 leverage), which makes them more suited to short-term trading opportunities. Stocks and commodities are more normally bought and held for longer. You might also pay a broker commission or fees when buying and selling assets direct and you’d need somewhere to store them safely.
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