Financial market research and analysis

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M&S facing the deflation challenge
Marks & Spencer will announce the 1H earnings tomorrow; analyst expects a significant drop in the EPS from £0.1942 in H2, 2015 to £0.1336, mostly due to a slump in the general merchandise sales – mainly clothing. Food should temper the fall in sales expected to have declined to £4.957bn in H1,2015 from £5.429bn in the second half of last year. The first half of the year has been difficult for retailers, the deflationary environment is a sizeable challenge.

The improvement in wages is encouraging for the future, whereas the back-to-school sales have barely compensated for a £27mn decline in sales during the month of August. Investors need some more patience as the economic recovery is happening in a quite slow fashion.

While the online operations carry hope, problems experienced by the distribution centre in Castle Donington and Leicestershire at the beginning of the year are a bit worrying.

M&S share price slid by 20% from May to September, the recovery is underway however the share price is still below the major 38.2% retracement level (£522.90p) needed to be cleared for a technical bullish reversal signal. Above this level, an extension to £537.60p is considered, while a failure to surpass £522.90p could signal a consolidation between £500-525 as investors could remain on hold due to slow economic recovery and strengthening pound.

Analysts remain optimistic however with buy/hold/sell recommendation as follows: 15/9/5. Slightly more than half is still willing to buy for a 12-month target price of £567.74p

21-5-2019

Nasdaq with US tech sector plummet on Huawei decision
Wall Street closed lower as the fallout from Huawei dragged down tech stocks. The Nasdaq plummeted 1.7% on Monday as the crackdown on China’s largest telecommunications and electronic equipment maker pressured the US technology sector. US chip makers tumbled a… Read more

20-5-2019

Oil jumps as OPEC signals intention to maintain cuts
Markets Mixed As Google Suspends Business with Huawei Asian markets put in a mixed performance overnight as investors paused, waiting for new developments in the US – China trade dispute. This comes after a week of escalating tensions between the two powers. … Read more

17-5-2019

Pound below $1.28 as Theresa May prepares to leave
Wall Street closed higher for a third straight session overnight as solid economic data and robust earnings from the likes of Cisco and Walmart boosted sentiment. Investors put US China trade dispute anxieties behind them and continued to jump back into equiti… Read more

16-5-2019

Trump's Visible Hand Drives Markets
The Dow and the broader US market extended the relief rally on Wednesday amid easing trade tensions. News that Trump would restart trade talks with China boosted optimism that the two powers could avoid a prolonged, economically damaging trade war. But it woul… Read more

15-5-2019

Stocks Rebound with Chinese Stimulus Hopes
Asian markets followed Wall Street higher overnight as trade war fears eased. Markets across Asia rebounded from 3 ½ month lows on a softening of stance from Trump and amid growing expectations of further stimulus from the Chinese government. Despite the advan… Read more

14-5-2019

Worst Day on Wall Street Since Jan 3
Wall Street closed deeply in the red on Monday. The Dow shed over 600 points and the S&P dumped 2.5% in the worst trading day since 3rd January. Investors rushed to take risk off the table as China raised tariffs on US imports, a retaliatory measure to the… Read more

13-5-2019

Futures Plummet As Investors Eye Trade Dispute Impasse
As we head into the new week, trade tensions will remain a key focal point for the markets and risk sentiment. In the UK specifically, Brexit and Theresa May’s ability to cling to power ahead of next week’s European elections will be an important driver of dom… Read more

10-5-2019

Yield Curve Inverts But "Beautiful Letter" Keeps Deal Hope Alive Despite Tariff Increase
Global equity markets were mixed as investors digested the latest headlines from the US – China trade talks. Asian markets pared earlier gains, European bourses are pointing to a stronger open, whilst US futures head south. The mixed response from the market r… Read more