Financial market research and analysis

The FTSE is up 0.85% led by the IT and materials sector. JP Morgan has upgraded the investment grade metals and mining sector to neutral from underweight as the spread widening in the likes of Glencore and Anglo American has resulted in severe industry underperformance.

Anglo American +3% Signed a contract with Hoa Phat to import steel ore. Even with the demand for steel down in China, China iron ore imports reside at their highest this year.

Glencore +4.6% The mining giant seems to like either the top rung or the lower rung of the UK benchmark these days and this choppy price action looks set to continue with many investment houses disagreeing on the future of the company and the price target too. The cutting of zinc production and the debt restructuring has not relegated all the Glencore bears. Until we see copper prices rise dramatically form present levels (unlikely to be driven by an increase in demand) the issue of declining commodity prices will continue to weigh. For the time being, copper is rising and this is aiding sentiment to some degree.

Burberry (-11%) despite the company lowering its guidance back in May sales rose less than expected for the group owing in part to the Chinese slowdown . China’s recent yuan devaluation and concerns over the economic growth for the country weighed on demand. Retail sales rose by 2%, despite an increasingly difficult environment for the luxury sector, to £774m for the six months to 30 September.

Unilever +3.84% Beat sales estimates – underlying revenue increased by 5.7% - best growth in 3 years. The hottest summer in Europe on record has also benefited the group as the demand for the ice-cream increased.  Sales in emerging markets also increased (60% of the group’s business) by 8.4% in Q3. Improvements in consumer sentiment were witnessed in China, Mexico and India.