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Morning Round-Up: Carillion, GKN and Martin Luther King Day


The FTSE is flat in early trading this morning despite further records in the US markets on Friday, buoyed by results from banks JP Morgan and Wells Fargo.

GKN was this morning’s best performer following last week’s rebuffed Melrose Industries offer, up 2.2% while the big story surrounds Carillion as the government contractor enters compulsory liquidation.

CMC Markets analyst, Michael Hewson commented “The likelihood of a government bailout would appear to be remote, though the outstanding public sector contracts are set to taken in-house and run by the UK government. In terms of assets Carillion based on its 2016 accounts has tangible plant and machinery of £144m, a fraction of its overall debts, not to mention the £800m pensions liabilities.”

The Dollar remains weak against the Pound and the Euro. FxPro analyst, Edward Anderson noted “Recent inflation and retail sales data from the US has done little to halt the recent USD sell-off. With the global economy accelerating at a higher pace than the US and the tightening of global monetary policy the USD will continue to suffer.”

The US equity markets finished the week with another record breaking session “buoyed by results from banks JP Morgan and Wells Fargo and Energy names were supported by oil prices continuing to push higher.” suggested Accendo Markets analyst, Mike van Dulken. “A weaker USD helped even after supportive macro data, perhaps fuelled by President Trump threatening the Iranian nuclear deal and NAFTA.”

“Given that today’s Martin Luther King Day, meaning there’s no chance of an energy-injection from the US, trading may remain relatively subdued, especially with the Carillion crisis casting a shadow over the UK economy.” added Spreadex analyst, Connor Campbell.

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This article does not constitute investment advice. Make sure you do your own research or consult a professional advisor.

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