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23 October 2019

23/10/2019

Market Data and Morning Chat

Morning Chat 

Yes, but don’t hold your breath: To get a bill through Parliament you introduce it. Let everyone know its name. The first reading. Tick. You allow MPs to know the bill’s main principles. The second reading. Tick. Wait, what? Yes, last night, MPs finally voted for a Brexit direction approving the Withdrawal Agreement Bill 329 to 299! Now committee stage, which the government’s programme motion – the timetable vote to get the Bill through Parliament in three days – addressed. Not so fast; by 322 to 308 the timetable was not agreed.  Now what? Extension? Maybe. Election? Possibly. Halloween Brexit? Extremely unlikely!

So we’re not there yet: Boris Johnson had no option but to hit the pause button. The committee stage can take ages and opens the Bill to all manner of possible amendments. Having followed the Benn Act, the EU now has to grant an extension or a Halloween no-deal Brexit becomes quite possible although EU President Donald Tusk tweeted he’ll recommend a delay – possibly a rolling delay. The pound marginally slipped signalling the market hasn’t lost faith in the deal. So long as MPs don’t amend the deal so much to reduce support, we’re there. We just don’t know when.

Any good news? A minor slip in sterling’s pretty good.  Moreover, European markets were up in anticipatory optimism – the UK up over ½%. It was disappointing seeing US indices down ¼ to ¾% after nearly reaching new all-time highs, but new highs are often tricky to attain and there were some weak late earnings releases. Meanwhile, Procter & Gamble’s (+2.5%) results may not have been head & shoulders more than hoped, but were at the high end of expectations, United Technologies (+2.2%) lifted guidance and Biogen (+26.1%) remembered some useful trial stats to rekindle hopes in its Alzheimer drug treatments.

Asia stocks flat to down today with reports suggesting it’s the influence of a Brexit delay
Macron’s EU frustrations continue as Brussels sends a frank warning over his 2020 budget 
Brent prices rally to $59½  as OPEC considers further production cuts in December
US existing housing sales pace fails to build on last month’s gains, falling instead 2.2%
Verizon (+0.0%) will dial up millions of customers for Disney+ as it offers 1 year free to 5G users
After WeWork’s spectacular IPO fail, Softbank will take 80% control and invest $5billion 

Market Data


Selected Global Aggregates (Total returns, unhedged)    
MSCI AC World Equities (Local) down -1.46 (-0.11%) at 1,286 (YTD: 18.66%; 5YR: 55.9%)
MSCI AC World Equities (USD) down -21.12 (-0.23%) at 9,292 (YTD: 19.56%; 5YR: 50.5%)
Barclays Global Aggregate Bonds up +0.47 (+0.09%) at 510 (YTD: 6.52%; 5YR: 9.7%)    
    
Selected Equity Indices (Capital returns)    
S&P 500 down -10.73 (-0.36%) at 2,996 (YTD: 19.51%; 5YR: 53.6%)    
NASDAQ down -58.69 (-0.72%) at 8,104 (YTD: 22.14%; 5YR: 82.0%)    
Euro STOXX 50 up +4.74 (+0.13%) at 3,605 (YTD: 20.10%; 5YR: 18.4%)    
FTSE 100 up +48.85 (+0.68%) at 7,212 (YTD: 7.20%; 5YR: 12.4%)    
CAC up +9.34 (+0.17%) at 5,658 (YTD: 19.60%; 5YR: 36.1%)    
DAX up +6.73 (+0.05%) at 12,755 (YTD: 20.79%; 5YR: 41.0%)    
Nikkei 225  up +76.48 (+0.34%) at 22,625 (YTD: 13.04%; 5YR: 48.9%)    
Hang Seng down -244.04 (-0.91%) at 26,542 (YTD: 2.69%; 5YR: 13.8%)    
MSCI Emerging Markets up +5.57 (+0.54%) at 1,034 (YTD: 7.07%; 5YR: 5.3%)    
    
Selected Government Bond Yields    
US 2 Year down -0.03 at 1.56 (began the year at 2.49; 5 years ago it was 0.39)    
US 10 Year down -0.01 at 1.76 (began the year at 2.68; 5 years ago it was 2.27)    
UK 10 Year down -0.04 at 0.71 (began the year at 1.28; 5 years ago it was 2.24)    
Germany 10 Year down -0.02 at -0.39 (began the year at 0.24; 5 years ago it was 0.90)    
France 10 Year down -0.02 at -0.09 (began the year at 0.70; 5 years ago it was 1.30)    
Italy 10 Year down -0.01 at 0.91 (began the year at 2.74; 5 years ago it was 2.50)    
Japan 10 Year down -0.01 at -0.14 (began the year at -0.01; 5 years ago it was 0.47)    
Barclays EM Basket down 0.00 at 5.35 (began the year at 6.22; 5 years ago it was 5.19)
    
Selected Currencies    
$ strengthened +0.0017 versus € (+0.15%) at 1.1124 ($: YTD: 2.86%; 5YR: 12.0%)    
€ strengthened +0.0054 versus £ (-0.47%) at 1.1569 (€: YTD: -3.79%; 5YR: 9.6%)    
$ strengthened +0.0079 versus £ (+0.61%) at 1.2871 ($: YTD: -0.98%; 5YR: 19.7%)    
¥ strengthened +0.2000 versus $ (+0.18%) at 108.3800 (¥: YTD: -1.18%; 5YR: -0.1%)    
    
Selected Commodities    
Brent Crude ($/bbl) down -0.09 (-0.15%) at 58.96 (YTD: 10.89%; 5YR: -31.4%)    
WTI Crude ($/bbl) up +0.85 (+1.59%) at 54.16 (YTD: 19.27%; 5YR: -33.5%)    
Gold ($/ozt) up +2.05 (+0.14%) at 1489.70 (YTD: 16.16%; 5YR: 20.9%)    
Copper ($/mt) down -10.00 (-0.17%) at 5818.00 (YTD: -2.46%; 5YR: -12.2%)    
    
Data sourced from Bloomberg as of the close of last trading day.    
YTD = Year-to-date return; 5YR = five year return    

Nicholas Lowson Senior Portfolio Manager Kleinwort Hambros