US equities are stronger in early week trading. The USA30 has climbed 0.4%, the US500 is up 0.3%, and the USA100 has improved 0.5%. The Q4 earnings season begins this week. Decent to solid results are widely expected given generally easy comparisons. Banks will be the focal point this week, though comparisons will be challenging. Earnings from JP Morgan Chase, Wells Fargo, Citigroup, Delta Airlines, IHS Markit, Wipro, and First Republic Bank are due Tuesday. The US-China Phase One trade deal is expected to be signed on Wednesday. Q120 could be the final quarter of earnings outperformance, but this record rally for earnings growth and valuations continues unabated thus far, by the compliant central banks this still looks unlikely. Q1 is traditionally the weakest of quarters and the coming weeks will provide hard evidence of corporate performance going into US Election year.
European bourses are seeing modest, mixed moves, with the Euro Stoxx -0.1% weaker, Germany’s GER30 down -0.1% and France’s CAC40 0.1% higher. The UK’s FTSE 100 (UK100) has improved 0.3% helped by the significant fall in Sterling earlier today. Cable has recovered some of its fall but remains capped by the key 1.3000 level.
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Head Market Analyst
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