Global growth once again raising anxiety

Global stocks don’t appear to be ready to bounce back, adding to losses on Wednesday after lacklustre manufacturing data from across the world triggered this week’s selling spree. In Europe, stocks took a hit from weak earnings news as shares were dragged lower by miners and supermarkets. Meanwhile, on Wall Street, traders were put off by weak private jobs data, which added to worries on global growth.

Supermarkets were among the biggest fallers in London after a report that the top four UK grocers continue to lose market share to German discount retailers Aldi and Lidl. Shares of Morrison Supermarket lost 1.78% and Tesco dropped 5.44%. Sainsbury’s also slid 6.27% after the company announced it will cut its dividend in a continued effort to manage costs.

It was also a rough day for mining stocks, hit by weak copper prices. Rangold and BHP Billiton were both trading over 6% lower. One reason for the fall in metal prices were persistent concerns on a slowdown in China, the world’s second largest economy and the leading global consumer of metals.

Oil prices fluctuated on Wednesday ahead of key US supply data, as investors assessed the scale of the global supply gut. Although prices have jumped significantly since their lows earlier in the year, prices have shed some 5% of those gains in the past few sessions. Crude oil managed to touch $44.70 a barrel during midday trading, but suddenly tanked 0.60%, before closing the session 1.96% higher at $44.64.

Time Warner Inc., owner of CNN and Cartoon Network, enjoyed a day in the green. The company reported a slightly higher than expected rise in quarterly revenue thanks to a boost from higher ratings for CNN ahead of the US presidential election. Subscription income also rose, and advertising revenue grew 5% in the first quarter.

Topping the FTSE 100 was Next plc. The apparel and household retailer cut its full-year forecast and posted a quarterly decline in brand sales. But thanks to a 4% rise in sales, Next shares were sent trading over 3% higher during Wednesday’s session.

Intercontinental Exchange also traded firmly higher, after the US exchange operator announced that it did not intend to make a rival offer for London Stock Exchange Group. Back in March, LSE and Germany’s Boerse agreed to merge, with the deal expected to establish Europe’s largest stock exchange operator. Shares in Deutsche Boerse were also sent up over 5%, while LSE fell 4.2%.

In other news, betting companies have taken a hit this week after Leicester City shocked the sporting industry by winning the Barclays Premier League. With odds of up to 5,000 to 1 being offered at the beginning of the season, the underdog triumph has left the bookies facing a record £35 million in payouts.

Paddy Power shares fell after the company had to pay around £2 million to lucky punters who placed bets that the Foxes would take home the trophy. William Hill and Ladbrokes are also facing payouts of about £4 million each.

This article was issued by Rebecca Naudi, Trader at Calamatta Cuschieri. For more information visit, www.cc.com.mt. The information, view and opinions provided in this article is being provided solely for educational and informational purposes and should not be construed as investment advice, advice concerning particular investments or investment decisions, or tax or legal advice. Calamatta Cuschieri Investment Services Ltd. has not verified and consequently neither warrants the accuracy nor the veracity of any information, views or opinions appearing on this website.