The FTSE is up marginally in early trading this Wednesday morning after US equities closed under pressure yesterday on talk of delays to US tax reform and the prospect of a weakening Dollar.
“Reports in the US are circulating that Senate Republican leaders are considering a 1-year delay in the implementation of a major corporate tax cut to comply with Senate rules” suggested FxPro analyst, Edward Anderson. “USD had seen a recent improvement against its peers on expectations that President Trump’s Administration would deliver on their pledge to reduce taxes which would help economic growth and lift interest rates.”
“With the prospect of delays USD will lose much of its appeal and could give back its recent gains.”
With a weaker Dollar hampering many of the FTSE’s international contingent, Marks and Spencer is dampening spirits further, despite a largely positive set of results.
Spreadex analyst, Connor Campbell commented “While pre-tax profit (before adjusted items) fell 5% to £219.1 million, that was still higher than the £203 million estimated by analysts.”
“In the much-watched clothing and home division – which is currently leaderless after the shock departure of Jo Jenkins back in October –like-for-like sales were down 0.1% in Q2 and 0.7% for the first half, a colossal improvement on the 5.9% plunge seen in last year’s financial fourth quarter.”
However, the food business continued to disappoint, falling behind in like-for-like growth by 0.1% with a slowing down of its roll-out of Simply Food stores added for good measure. The share price was down 2.5% in early trading.
The Dow Jones was the lone record breaking US index yesterday as the 30-stock index scraped to a fresh record high, while peers retreated from fresh intraday highs to close lower.
Accendo Markets analyst, Mike van Dulken noted “The Dow saw Financials weigh ahead of the release of further details from the Republican tax reform plan later this week, offsetting Media sector positivity following M&A speculation. The latter also led the S&P 500, although failed to help the index to a record high, closing just shy of breakeven.”
“The Tech-focused Nasdaq underperformed. Note Snap disappointed after hours with weaker than expected user growth figures, seeing shares fall as much as 22% after hours.”
