Global Market Report - May 17, 2018

UK shares are on the move on Thursday, not least online food firm Ocado, which has risen nearly 50%

James Gard 17 May, 2018 | 10:58AM

Asia

Markets in the region were mixed, with the majority drifting lower. Japan was the exception, with the Topix and Nikkei indices inching higher after a strong move to the upside for the dollar against the Japanese yen. The yen is now at its weakest level against the dollar for four months.

Japan’s inflation figures, released on Friday morning, will be more closely watched than usual after disappointing growth figures this week. Year-on-year inflation is expected to have softened in April to 0.7%, from 1.1% in March.

China’s Vice Premier Liu arrives in the US today to continue trade talks, which appear to have hit a rocky patch – despite President Trump’s concession over ZTE jobs.

Mainland China and Hong Kong markets were lower on Thursday, continuing the weaker trend seen in recent trading sessions.

Europe

A typically busy Thursday for corporate news in the UK drove some significant share price moves. The biggest mover was Ocado (OCDO), whose shares rose nearly 50% in morning trading after announcing a tech deal with US firm Kroger, which is also taking a stake in the UK online retailer. Ocado has been the target of short selling in recent years but bulls have had the upper hand in the last six months, pushing the shares up from 238p to just below 800p today.

Shares in under-fire Mothercare (MTC) surged nearly a quarter on Thursday morning as it revealed a new restructuring programme and said that its recently ousted CEO – who left in April – would return to lead the business. The mother-and-baby retailer is to close 50 stores.

Betting firm shares have been volatile recently with a number of conflicting dynamics: PaddyPowerBetfair (PPB) has surged in value recently with news that the United States is relaxing rules on sports betting. On the other hand, today’s announcement by the UK government that fixed-odds betting terminals will have a maximum stake of £2 has hurt domestically listed stocks like William Hill (WMH) and Ladbrokes Coral.

At the opposite end of the FTSE 100, Royal Mail (RMG) shares were off nearly 6% after a drop in profits relating to its pension scheme.

Oil shares gained on another move higher for the Brent crude price.

North America

Bond yields are setting the direction for US equity futures today, which suggests that markets will open lower. However, the Dow Jones, S&P 500 and Nasdaq all managed to end the day higher despite growing anxiety over global politics – particularly with US-North Korea relations souring in recent days.

In economics, weekly jobless figures are released as will the Philadelphia Federal Reserve Business Outlook for May.

Walmart (WMT) reports before the market opens.

 

 

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Securities Mentioned in Article
Security NamePriceChange (%)Morningstar
Rating
Mothercare PLC39.10 GBX22.18-
Ocado Group PLC851.21 GBX6.40-
Paddy Power Betfair PLC8,750.00 GBX1.74-
Royal Mail PLC556.50 GBX2.00-
Walmart Inc84.21 USD0.68
William Hill PLC334.70 GBX1.03-
About Author

James Gard  is subeditor for Morningstar.co.uk