FTSE 100 rises on avast boost
Britain’s main stock indexes closed higher on Wednesday as Avast surged after it won regulatory approval for NortonLifeLock’s $8.6 billion deal, while banks rose a day before an expected interest rate hike from the Bank of England.
Shares of Avast Plc soared 43.8 percent to an all-time high after Britain’s competition regulator said it has provisionally cleared cybersecurity firm NortonLifeLock’s $8.6 billion purchase of its rival.
The blue-chip FTSE 100 index was 0.5 percent higher, while the domestically focussed midcap index gained 0.7 percent. Both the indexes clocked strong gains in July, with the FTSE 100 outperforming its global peers so far this year.
“The UK market is a defensive market, so it will tend to outperform in a year like 2022 when there are a lot of uncertainties,” said Thomas Moore, senior investment director at abrdn.
“People will still pay for their energy, heating bills; they will buy cigarettes, a bottle of whiskey. Inflation and interest rates could be a problem for the UK economy, but it is unlikely to be a problem for UK stock market.” All eyes are on the Bank of England’s meeting on Thursday where policymakers are expected to raise interest rates by 50 basis points after other central banks pushed up borrowing costs sharply in recent weeks, despite the risk of an economic slowdown or a recession.
S&P 500, DOW, NASDAQ end up on positive economic data
Stocks on Wall Street closed broadly higher Wednesday as investors welcomed encouraging economic data and quarterly earnings reports from big companies including Starbucks.
The S&P 500 rose 1.6 percent to an almost 2-month high, while the Nasdaq gained 2.6 percent. Both indexes more than recouped losses earlier in the week. The Dow Jones Industrial Average rose 1.3 percent and the Russell 2000 index of smaller companies ended 1.4 percent higher.
Technology companies, retailers and communications companies were some of the biggest winners. Only energy sector stocks fell, dragged down by lower oil prices.
Investors cheered a report on the services sector, which makes up the bulk of the U.S. economy. The sector grew faster than expected in July, according to the Institute for Supply Management. A separate report showed U.S. orders for big-ticket, durable goods increased more than expected in June.
UK banks rose 1.5 percent ahead of the decision.
“If we get the 50 basis point hike, the big winners of that will be the banking sector,” said Stuart Cole, head macro economist at Equiti Capital.
“But it is going to come at the same time as consumers are facing higher cost of living with things such as inflation.” Markets also took comfort in US House Speaker Nancy Pelosi’s leaving Taiwan following a visit which angered China.
Hiscox dipped 0.7 percent after the Lloyd’s of London insurer posted a first-half pretax loss of $107 million.
TASI flat as investors monitor US-China tensions: opening bell
Saudi Arabia’s main index, TASI, and the parallel market, Nomu, started the week’s final session flat at 12,294 and 21,750 respectively, as investors monitored US-China tensions following Nancy Pelosi’s visit to Taiwan.
As of 10:07 a.m. Saudi time, the Kingdom’s oil giant Saudi Aramco started the day with a 0.63 percent decline.
The Saudi National Bank dropped 0.28 percent, while the Kingdom’s largest valued bank, Al Rajhi, added 0.46 percent.
Riyadh Bank gained 1.10 percent, after its first-half profit rose 10 percent to SR3.2 billion ($842 million).
National Industrialization Co. gained 0.60 percent, despite a profit decline of 11 percent in the first half of 2022 to SR606 million.
Saudi Steel Pipe Co. gained 3.42 percent, after it recorded profits of SR26 million in the first half of the year, compared with losses of SR16.7 million in the same period of 2021.
Saudi Industrial Investment Group dropped 3.39 percent to lead the fallers, after its profits for the first half declined by 36 percent to SR519 million.
Brent crude fell to $96.38 a barrel, while West Texas Intermediate fell to $90.39, as of 10:19 a.m. Saudi time.
Canada stocks-TSX rises as geopolitical tensions ease
Canada’s main stock index rose on Wednesday as geopolitical worries eased after U.S. House of Representatives Speaker Nancy Pelosi left Taiwan, following a visit which infuriated China.
Pelosi pledged solidarity and hailed Taiwan’s democracy, leaving a trail of Chinese anger over her brief visit to the self-ruled island that Beijing claims as its own.
“People are getting a little more comfortable that we haven’t really seen anything overnight coming out of China and Taiwan,” said Greg Taylor, portfolio manager at Purpose Investments in Toronto, Ontario.
“There is some optimism there and maybe a bit of a room for a bounce off some of the selling we got yesterday afternoon.”
At 10:15 a.m. ET (1415 GMT), the Toronto Stock Exchange’s S&P/TSX composite index. GSPTSE was up 53.03 points, or 0.27 percent, at 19,558.36. The energy sector .SPTTEN dropped 0.4 percent, while financials .SPTTFS gained 0.5 percent
Geopolitical tensions knocked down Canadian stocks on Tuesday, with Wall Street also ending lower.
Britain’s competition regulator said that Canadian cloud-based software firm Dye & Durham DND.TO should sell UK-based TM Group after its investigation identified competition concerns. Shares of Dye & Durham rose 3 percent.
Colliers International Group Inc CIGI.TO rose 3.7 percent after the company raised its full year forecast for 2022 as a result of recent acquisitions.
Market participants will also be watching for payrolls data from both Canada and the United States on Friday for hints on the strength of the labor market and how their respective central banks will react to rising inflation and a stalling economy.
Data on Tuesday showed that Canadian manufacturing activity lost further momentum in July, as production and new orders declined for the first time since the early stages of the coronavirus pandemic.