The euro accelerated to 1.1538 overnight. At the time of writing (7am) the euro was at $1.1521. The euro bounce was caused by more President Trump anxiety and his (in)ability to push through tax policy, resulting in a US dollar sell-off. The Republicans were also on the defensive after their attempt to kill off Obamacare hit more chaos in US Congress.
The pound also benefited from the ruckus, up +0.31% to $1.3094, worth a 1.70% weekly climb. Building on the euro positivity, JP Morgan now think the euro could continue to rise through 2017 while US inflation and retail sales remains weak.
Out this morning at 9.30am are UK inflation numbers. Since the Brexit referendum Consumer Price Index (CPI) inflation has surged; it’s expected CPI could hit 3% for June, a four-year high. The Bank of England’s target rate is 2%.
So, more pressure on the Bank of England to raise interest rates while many workers feel increasingly hard up.
- UK FTSE 100 7,404.13 +0.35%
- Dow 21,692.72 -0.04%
- S&P 500 2,459.14 -0.01%
- Nasdaq 6,314.43 +0.03%
- Nikkei 225 19,993.36 -0.62%
- DAX 12,587.16 -0.35%
- CAC 40 5,230.17 -0.10%
- Gold 1,237.40 +0.30%
- Oil WTI 46.01 -0.02%
Royal Mail revenues creep higher
We start with Royal Mail and a group revenue 1% uptick for the three months to 25 June for group sales helped by stronger Parcelforce delivery and logistics performance. However this revenue climb is offset by a 1% dip in the other key Royal Mail arm, UK letters (UKPIL).
“Our performance in letters was better than we expected, despite continued business uncertainty in the UK,” said Royal Mail. However the group’s share price is down more than 21% over the past year and almost 14% down year-to-date.
“We remain on track to deliver our cost avoidance and net cash investment targets for the full year,” said Royal Mail. Liberum recently reiterated a Sell verdict on the stock – worry about parcel market share pressure.
Experian revenues climb
We switch next to information services player Experian. For the three months to 30 June there’s 6% revenue growth and organic revenue growth of 4%. Its business-to-business services report 7% organic growth and good performances across all regions, it claims.
“We are also taking important steps to reposition Consumer Services as we introduced two new services in the US,” Experian says.
Experian says it expects growth for the year to be within its mid single-digit organic revenue range target, “with stable margins and further progress in benchmark earnings per share." Experian shares are up 6.25% in the last 12 months.
Breaking news: More calls to raise UK interest rates. Dr Andrew Lilco from Europe Economics says a rate hike will help the UK economy. "Rates have been at an emergency level for some years, but we have not had an emergency for some time," he told the Today program earlier.
Netflix claims subscribers have hit 104m – better than expected. Dairy Crest is warning on higher cream prices and is cutting ad spend on its Country Life brand.