Financial market research and analysis

The direction of the copper price has a vast impact on the price action in the FTSE so given that we have fallen below $4500/T, it’s little wonder the mining contingent of the index is under some pressure. Prices are down 27% so far this year as fears that slowing economic growth in China, weakening growth in the Eurozone and oversupply all culminate in a sell off.

Glencore (– 5.47%)
Anglo-American (– 4.38%)
Antofagasta (– 3.27%)
BHP Billiton (– 3%)
Rio Tinto (– 2.03%)

At present only 6 stocks are on the up and these gains are fairly marginal and mostly related to defence and indeed defensive stocks.

Babcock Intl (+0.61%) - said to be among the rivals for the UK defence contract – running fire, rescue services at UK military bases and airfields including the Falklands.

BAE Systems (+ 1.36%) Prime Minister David Cameron will announce plans Monday to boost Britain’s military equipment budget by 12 billion pounds ($18 billion), the latest in a range of government commitments to fight terrorism and other security threats as Europe remains on a state of high alert.
Up to 371 jobs are being cut at defence giant BAE Systems as the group said it was slowing production of its Typhoon jet fighters. The job losses will affect its 10,000-strong workforce in Samlesbury and Warton, which makes the Eurofighter Typhoon.

Rolls Royce +0.54% attempts to revive the company starts with cuts to the senior management team. CEO Warren East is reticent about demerging its aero engine business.

Imperial Tobacco (+ 0.37%) - with the takeover rumours in the full swing, the tobacco company has been given a lift – raised to buy at Citi

Volkswagen (– 0.71%) reports over the weekend that the business has suffered in the aftermath of the emissions scandal are labouring the stock price this morning. Sales have apparently declined significantly and the company is expected to reduce its capex plans for 2016.

Shares in Argos and Homebase owner Home Retail Group have jumped 6.48% after £1bn takeover speculation. Given the low valuation of the company and questions regarding the transformation plan in Argos, it shouldn’t be surprising that private equity groups are vying for the retailer.

We are calling the Dow slightly lower to 17803.