Global Market Report - March 19, 2018

Asia and Europe exchanges fell at the start of the week, while US stocks are also expected to drop at the open

James Gard 19 March, 2018 | 10:55AM
Facebook Twitter LinkedIn

Asia

Japanese markets started the week as the worst performers in the Asia-Pacific region, closely followed by South Korea’s Kospi.

China and Hong Kong markets managed a positive close to the day’s trading as political developments helped boost sentiment: China’s President Xi Jinping’s new term was approved at the weekend and the country has a new central bank chief after Yi Gang was promoted from Deputy Governor. Yi, a US-educated economist, is keen on opening up China’s economy to foreign investments.

Europe

In recent months, UK listed companies that have delivered bad news to investors in the form of profit or sales warnings have had their shares prices sold off sharply. Today’s example is Berkshire-based software firm Micro Focus (MCRO), which warned on sales revenue and said its chief executive had left with immediate effect. The company’s shares fell sharply at the open and moved even lower in midmorning trading, to register a near-60% loss.

Retail-focused commercial property firm Hammerson (HMSO) was top of the FTSE 100 leaderboard after it was revealed that it had recently rejected a bid from France’s Klepierre.

With Micro Focus’s share price slide and the pound pushing up against major currencies, the FTSE 100 dropped over 1% to 7,073 – revisiting levels last seen at the end of 2016. Sterling rose on Monday on modest hopes that the UK and EU are close to a deal on a Brexit transition.

European exchanges caught the uncertain mood globally and were hampered by a rise in the euro against most major currencies apart from the pound.

North America

The Federal Reserve’s March meeting overshadows the week’s US economics. The consensus is for new Fed chair Jerome Powell to announce a quarter point rate rise.

In earnings, Oracle (ORCL) reveals results after the market closes on Monday. Tech stocks dependent on Apple (AAPL) are expected to move today on talk that the California tech giant is planning to design and produce its own screens in the future. Facebook (FB) is expected to be under pressure in Monday trading after news of a huge data breach broke over the weekend.

The global weakness – China aside – in equity markets looks set to affect the US markets, with the Dow expected to fall 100 points at the open, according to futures markets.

The information contained within is for educational and informational purposes ONLY. It is not intended nor should it be considered an invitation or inducement to buy or sell a security or securities noted within nor should it be viewed as a communication intended to persuade or incite you to buy or sell security or securities noted within. Any commentary provided is the opinion of the author and should not be considered a personalised recommendation. The information contained within should not be a person's sole basis for making an investment decision. Please contact your financial professional before making an investment decision.

Facebook Twitter LinkedIn

Securities Mentioned in Article

Security NamePriceChange (%)Morningstar
Rating
Apple Inc159.69 USD-0.06Rating
Facebook Inc A294.63 USD-1.84Rating
Hammerson PLC37.57 GBX5.39
Micro Focus International PLC432.00 GBX2.10
Oracle Corp79.59 USD-1.83Rating

About Author

James Gard  is content editor for Morningstar.co.uk