Domino's Pizza Spread Betting Market Rises Sharply After Strong Rise in Online Sales
|
|
|
For today's update see Spread Betting Daily.
The Daily Update from Anthony Grech, Research Analyst, IG Index.
Spread Betting 4 January 2011: 10.45am Update
The atmosphere in the financial spread betting markets this morning is far more subdued than yesterday, with UK markets struggling to remain in positive territory, while European markets fall back.
Warnings about a looming recession in Europe have done nothing to help, and the worries of the old year are returning to haunt the new.
By 10.30am (London time), the FTSE 100 spread betting market was up only 7 points at 5707.05, and the FTSE 250 had dropped 19 points to 10,343.33.
Rally loses steam
The 2012 rally has struggled to push into a second day as markets in Europe fall back, while the FTSE 100 fights to hold on to what little gains it has made this morning.
Trading is significantly quieter now that all markets are back from their New Year break, as traders await the result of a German ten-year bund auction.
Economic data from the Eurozone showed that the region continued to show modest improvement, with composite and services PMIs rising slightly, although they remain below the 50 mark that separates contraction from expansion.
The positive effects from yesterday’s swathe of better figures from China, India, Germany and the US have rapidly worn off, aided by comments from Eurogroup president Jean-Claude Juncker.
Mr Juncker said that the Eurozone was on the brink of a recession, echoing the cheery statements made by Eurozone leaders over the New Year. He also added that Greece was not contemplating a return to the drachma.
Maybe the EU isn’t expecting Greece to leave the euro, but I suspect the Greek government has contingency plans for just such an eventuality.
The bugbears of 2011 were only forgotten for one day; investors are now worried again about the Eurozone and weakness in China.
Comments from a Chinese newspaper that the government might provide subsidies for vehicles and household goods prompted a small rally overnight but the effect was short-lived. This is perhaps because the idea that active intervention might be necessary underscores the worry that the Chinese economy is weakening perceptibly.
Next & Domino’s report figures
Retailers and consumer goods are on the agenda in the UK this morning, as clothing giant Next and food staple Domino's Pizza both provide updates.
Next was saved in part by the performance of its online arm, Next Directory, which saw sales rise by 17%, helping to compensate for a weak November and December.
The company remains cautious on the outlook for 2012, saying that pre-tax profit is expected to rise only slightly. Next shares dropped 3% to 2659p, but are still up 30% compared to January 2011.
Meanwhile, Domino’s Pizza shares rose 4.5% to 432.5p, as the firm unveiled a strong rise in online sales. Mobile devices are helping Domino’s to increase its sales via the internet, with sales up 43% over the year.
Overall sales growth was 3% for the year, much slower than the impressive 12% seen for 2010-2011, but the company said it was still pleased with the expansion given the weaker consumer environment.
Looking ahead
US futures seem to indicate a quiet start for Wall Street, with the Dow up 2 points and the S&P 500 0.5 points higher.
Economic data is also less exciting than yesterday, with only weekly mortgage data and December factory orders on the schedule for today, at midday and 3pm (London time) respectively.
Remember that financial spread betting is a leveraged product and can result in losses that exceed your initial deposit. Spread betting may not be suitable for everyone, so please ensure that you fully understand the risks involved.
The above comments do not constitute investment advice and neither IG Index nor SpreadBets.org.uk accept any responsibility for any use that may be made of them.
Advert:
IG Index Spread Betting - No Fees, No Commissions, Free Charts and Live Prices.
Spread Bet on Indices, Forex, Commodities, Shares and more. For details see IG Index.
|
Spread Betting 04 January 2012: 4.30am Update
Overnight, US markets kicked off their first trading day of the new year on a positive note with the Dow Jones Industrial Average adding 1.5% to end at 12397, the S&P surged 1.6% to 1277, while the NASDAQ jumped 1.7% to 2648.
Traders seem to have entered 2012 recharged, optimistic and seemingly ready to see the world through fresh eyes.
The positive start in risk assets in all parts of the capital markets has seen many scratching their heads and wondering if their preference is to still sell risk. Many are considering whether 2012 could be a strong contrarian play given the heightened negativity in the final stages of last year.
It will of course be a bumpy road, but we have seen a barrage of good news, highlighted over the last 24 hours or so, by a concerted improvement in global manufacturing.
It seems that momentum, for now, is for risk to appreciate and some are even hoping for a pullback in gold, AUD/USD and the Australian dollar crosses.
Asia & Australia
The ASX 200 has surprised everyone today and is one of the talking points of the Asian markets. It’s early days, but traders seem to be ‘buying the dogs of 2011’ and executing a classic ‘laggards to leaders’ trade in the early parts of the year.
The fact that the material sector is top of the leader board again suggests that traders are rolling out of low beta names and adding risk. It is also interesting to see follow-through buying in our local market, something that in the last few weeks of 2011 was unheard of.
The market has seen a 2% gain and, while some will point to low volumes assisting matters, it is still positive to see local stocks higher despite no real excitement in the Nikkei, Kospi, Hang Seng and US futures.
The USD is also higher in Asian trade versus all G10 currencies, which is putting modest downside pressure on crude and gold.
It is interesting to see traders buying back into the Australian ten-year treasury again after yesterday’s aggressive 17-point move higher in yields, pouring water on anyone hoping we were going to see an aggressive asset re-allocation anytime soon.
Europe
The question traders are asking themselves though is, OK, we have seen an improvement in manufacturing and recent US data that suggests a 3.5% gain in Q4 GDP, but has anything else really changed?
The answer is probably no, there is a huge funding task by sovereign nations, not just in the first quarter but throughout 2012. The world’s biggest economies have more than $7.6 trillion of debt maturing this year, with most facing rising borrowing costs, while European growth is being called into question day-by-day.
The point is, the risks are still very real despite a good start to 2012, but the tape, for the time being looks positive and this will encourage further short covering.
Risk assets have had a good bounce from the bottom of their range and, given how fickle markets can be, we feel traders are not likely to let any profitable positions run too long given the clear macro risks.
Turning to the forex spread betting markets, and while the US dollar is looking strong versus all G10 currencies, if we focus on the euro, a counter-trend is shaping up nicely. After a 9.6% fall from October 27, EUR/USD last night broke and closed above the downtrend at $1.2990.
It was also interesting to get further confirmation of Europe’s two-speed economy, with an improving jobs market in Germany, where unemployment fell to a 20-year low. In contrast, Spanish jobless figures rose for a fifth month and, at 23%, this highlights how tough things are in the south of Europe.
While most will be highlighting the improvement in manufacturing, it was also worth looking at, that despite recent talk of a potential downgrade to the French credit rating, it had no problems getting €8.71 billion of short-term bills away. In addition, the amount borrowed from the ECB’s marginal lending facility fell 14.4% from last week.
European markets look set to start the new day on relative flat note after Asian bourses generally did not see follow through buying.
Eurozone manufacturing PMI data is scheduled for release, and the expectations are for no change to last month’s contraction; given European growth is front and centre this will get a close look.
European CPI estimates are also due, and the expectations are for a slight decline in inflation to 2.8%; any drop below 2.4% or so and we would expect a strong move to the downside.
Germany will also try and tap the market for €5 billion by issuing ten-year bonds, though remember Germany is the only country in recent times to have a failed auction.
Ahead of the open we are calling the FTSE at 5690 (-9), DAX at 6145 (-22) and CAC at 3229 (-16).
Remember that financial spread betting is a leveraged product and can result in losses that exceed your initial deposit. Spread betting may not be suitable for everyone, so please ensure that you fully understand the risks involved.
The above comments do not constitute investment advice and neither IG Index nor SpreadBets.org.uk accept any responsibility for any use that may be made of them.
Advert:
IG Index Spread Betting - No Fees, No Commissions, Free Charts and Live Prices.
Spread Bet on Indices, Forex, Commodities, Shares and more. For details see IG Index.
|
"Domino's Pizza Spread Betting Market Rises Sharply After Strong Rise in Online Sales" last update by AG, 04-Jan-2012
Warning: Financial spread betting carries a high level of risk. You can lose more than your initial investment or stake. Financial spread betting may not be suitable for all investors. Only trade with money that you can afford to lose. Make sure you fully understand the risk involved. If necessary, seek independent financial advice.
Similar articles:
Spread Betting Daily - last update: 17-May-2012
Your daily spread betting update from the insiders. A look at the FTSE 100 and a range of other spread betting markets from Crude Oil to Shares to Gold to . . . read more Spread Betting Daily.
Spread Bets Daily Markets - last update: 16-May-2012
Spread Betting Daily News - A daily trading update from IG Index. Every weekday the experts offer their view of the markets . . . read more Spread Bets Daily Markets.
Shares Trading: AstraZeneca Declines on Plummeting Pre-Tax Profits - last update: 26-Apr-2012
Drug maker GlaxoSmithKline dropped 0.4% after it reported a 13% decline in first-quarter profits, while AstraZeneca declined 5.6% after it reported a 40% drop in pre-tax profits. Unilever shares climbed 3% to 2635p after sales rose . . . read more Shares Trading: AstraZeneca Declines on Plummeting Pre-Tax Profits.
ARM Holdings Spreads Rally amid Stellar Apple Results - last update: 25-Apr-2012
In equities spread trading, ARM Holdings was the top FTSE 100 gainer, up 4.3%, bouncing after a lukewarm reception to in-line results from the British chip designer on Tuesday. The price gain was on the back of forecast-beating . . . read more ARM Holdings Spreads Rally amid Stellar Apple Results.
Spread Trading: Rallying Banking Stocks Push FTSE Higher - last update: 24-Apr-2012
Banking stocks led the FTSE's marginal recovery. Lloyds rose 2.25 %, while Barclays, Standard Chartered and HSBC spread trading markets were up by 1.34%, 0.15% and 0.1% respectively. Miners also edged up today . . . read more Spread Trading: Rallying Banking Stocks Push FTSE Higher.
Index Spread Betting: FTSE Falls 100 Points as Sarkozy Losses Election Round - last update: 23-Apr-2012
The FTSE 100 shed a hundred points during the morning session as uncertainty over the French presidential election on Sunday unnerved investors. Current French President Nicolas Sarkozy lost to Francois Gerard Georges . . . read more Index Spread Betting: FTSE Falls 100 Points as Sarkozy Losses Election Round.
Broker Upgrade Boosts Lloyds Shares Spread Betting Market - last update: 20-Apr-2012
Elsewhere in shares spread betting, Lloyds was the second-biggest FTSE 100 gainer, up 3.5% as Investec Securities reiterated its 'buy' rating on the part state-owned British lender. Unsurprisingly, shares in Barclays and . . . read more Broker Upgrade Boosts Lloyds Shares Spread Betting Market.
FTSE 100 Spread Betting Index Rises on Successful Spanish Auction - last update: 19-Apr-2012
The FTSE 100 spread betting index traded at 5783.8, gaining 0.64% by midday (London time) on the back of a successful Spanish bond sale. Spain sold €2.541 billion of debt, slightly above the upper end of their target . . . read more FTSE 100 Spread Betting Index Rises on Successful Spanish Auction.
Increased Gold Output Causes Fresnillo Spreads to Rally - last update: 18-Apr-2012
Also in shares spread betting, Fresnillo was one of the mining sector's best performers, gaining more than 3% as gold output was ahead of target, due to the opening of a new mine, Noche Buena. This came despite an . . . read more Increased Gold Output Causes Fresnillo Spreads to Rally.
EUR/USD Forex Spreads Push Higher Despite Rising Spanish Yields - last update: 17-Apr-2012
Talk on the floors seems to be centred on the sharp move higher for the EUR/USD financial spread betting market in US trade, despite no one single catalyst to attribute the move too. One gets the sense though that $1.30 seems . . . read more EUR/USD Forex Spreads Push Higher Despite Rising Spanish Yields.
Spread Betting Daily Index - An index of Mid-Morning Daily Spread Betting Reports covering the key Index, Forex, Shares and Commodities markets.
|
|
|
Free Financial Email: Latest Spread Betting Offers and where to find narrow spreads.
Click here to sign up.
|
|
