Brexit negotiations begin in earnest from 11am. This may fuel some volatility for the pound while talks get under way between Brexit Secretary David Davis and EU chief negotiator Michel Barnier. The news of a likely terrorist attack in North London has done little to rattle the pound so far.
More Bank of England willingness to hike interest rates last week has helped support sterling, not to mention gilt prices, off its two-month 9 June election shock $1.2636 low. At 7.30am this morning the pound was steady at $1.2770 while the euro was at $1.1201.
A quiet day in terms of economic announcements; German Producer Price Index comes through at 7am tomorrow. The Queen's Speech has been knocked back till Wednesday.
- UK FTSE 100 7,463.54 +0.60%
- Dow 21,384.28 +0.11%
- S&P 500 2,433.15 +0.03%
- Nasdaq 6,151.76 -0.22%
- Nikkei 225 20,043.60 +0.51%
- DAX 12,752.73 +0.48%
- CAC 40 5,263.31 +0.89%
- Gold 1,254.50 -0.16%
- Oil WTI 44.60 -0.34%
J Sainsbury's eyes up Nisa
A subdued day also on corporate results. We begin though with news that J Sainsbury is poised to sign an exclusivity deal with convenience store distribution player Nisa. Nisa has close relationships with around 2,500 independent stores in the UK.
Other supermarket groups have been looking hard at Nisa, including the Co-op. It’s thought Sainsbury’s will offer £2,500 a share though Nisa’s members will have to endorse any deal; support levels remain difficult to gauge. Any buy is part of a longer-term play by supermarkets to buy greater access into the UK convenience market as shopping habits shift away from larger stores.
If a J Sainsbury’s move goes through it would likely mean certain demutualisation for Nisa’s members; no date for a vote has yet been arranged. The race for more acquisitions and greater retail footprint has been sparked by Amazon snapping up organic food chain Whole Foods on Friday, which saw grocer share prices tumble.
Scottish Investment Trust lifts 5%
New performance numbers are out from ‘high conviction-contrarian’ The Scottish Investment Trust, claiming a 5% return for the six months to 30 April and a dividend hike of 4.8%. The total NAV return is 3.0% says the trust.
“The Board believes that the Company remains well-placed as a differentiated, low-cost investment vehicle,” it said in a note to the City earlier, “focused on delivering above-average returns and dividend growth over the longer-term.”
Lastly, the Federation of Small Businesses reports that Scottish business confidence is on the up. The FSB says confidence has increased for the second consecutive quarter though worry remains about profit margins.
However regional imbalances across the UK remain stark: the East Midlands, Wales and London have the highest regional confidence readings, while Yorkshire, the North West and Scotland – still – are among the lowest.
“Many small firms,” says FSB chairman Mike Cherry, “are still reeling from the business rates revaluation that took effect in April. The £300 million hardship fund announced at the Spring Budget to help those worst effected offered a glimmer of hope, but is yet to materialise.”
Breaking news: Jaguar Land Rover is set to hire up to 5,000 new staff in an effort to spearhead its electric vehicle grip. Most jobs will be UK-based the company says.