Stocks in Europe were mixed on Monday midday amid more staffing announcements by incoming US president Donald Trump, while the gold price continued to climb.
‘The FTSE 100 ticked higher on Monday, helped by a decent showing for resources and financial stocks,’ commented AJ Bell’s Russ Mould.
Meanwhile in Europe, the eurozone’s trade surplus with the rest of the world grew significantly in September, figures from Eurostat showed.
The surplus widened to €12.5 billion in September from €4.1 billion in August and from €9.8 billion a year ago.
The significant monthly increase was driven by an increase of surplus for machineries and vehicles to €13.8 billion in September.
The FTSE 100 index was up 9.16 points, 0.1%, at 8,072.77. The FTSE 250 was down 81.13 points, 0.4%, at 20,395.51, and the AIM All-Share was up 0.24 points, almost flat, at 727.38.
Endeavour Mining was among the FTSE 100 winners, rising 1.3%. Melrose continued to lead, gaining 6.3% since it backed annual guidance amid a strong aftermarket performance.
John Wood Group led the FTSE 250 with a 6.1% rise, followed by Hochschild Mining which gained 3.9% and gold miner Centamin, up 2.9%.
Berenberg cut its price target for engineering firm John Wood to 60p from 150p, but maintained a ’hold’ rating.
On AIM, Judges Scientific fell 13%.
The scientific instrument sector investor reported a ‘disappointing trading performance’, saying that crystallisations and deliveries of certain orders will likely not be completed in time to deliver against its full-year guidance. It now expects adjusted basic earnings per share of between 270p and 300p, at least 20% lower than 374.6p it had reported for 2023. Previous expectations pointed at adjusted basic earnings per share of 384.6p for 2024.
The Cboe UK 100 was up 0.1% at 811.59, the Cboe UK 250 was down 0.5% at 17,895.17, and the Cboe Small Companies was down 0.2% at 15,828.60.
In European equities on Monday, the CAC 40 in Paris was down 0.1%, while the DAX 40 in Frankfurt was down 0.2%.
The pound was quoted at $1.2617 at midday on Monday in London, lower compared to $1.2639 at the equities close on Friday. The euro stood at $1.0539, basically flat against $1.0538. Against the yen, the dollar was trading higher at JP¥155.00 compared to JP¥154.72.
‘It feels like a day for taking stock of where we are, after seeing such a savage reaction to President-elect Trump’s victory and the Republicans’ clean sweep in the elections,’ commented Societe Generale’s Kit Juckes. ‘Overall, after building up a very big net long USD position in the first half of 2024, we saw a huge swing to a big short by the start of September, and we are now three quarters of the way back to the peak.’
Stocks in New York were called mixed. The Dow Jones Industrial Average was called down 0.2%, the S&P 500 index up 0.1%, and the Nasdaq Composite up 0.4%.
In the US, following news that Elon Musk’s staunch ally Brendan Carr will lead the Federal Communications Commission under Donald Trump, the president-elect has also selected fossil fuel executive Chris Wright to serve as energy secretary.
Chief executive of Denver-based Liberty Energy, Wright is a vocal advocate of oil and gas development, including fracking, a key pillar of Trump’s quest to achieve US ‘energy dominance’ in the global market.
The incoming Trump administration could face a ‘no-win scenario’, AJ Bell’s Mould said, explaining: ‘His policies are designed to boost US economic exports, output and growth. But if they prove so successful that the dollar advances strongly as a result, then the damage to the rest of the world could be considerable and perhaps enough to deprive America of the buyers of its exports for which it longs.’
However, Mould added: ‘With the possible exception of China, much of Trump’s tariff talk could be just that – talk – as he adopts a bargaining position in search of a deal.’
Brent oil was quoted lower at $71.20 a barrel at midday in London on Monday from $72.08 late Friday.
Gold was quoted higher at $2,591.07 an ounce against $2,569.63.
‘The precious metal may be the biggest ’tell’ of all,’ AJ Bell’s Mould said. ‘If Trump fails – or backs off – and the US keeps piling up a fiscal deficit as well as a trade one then gold could thrive, not least as such an environment would smack of plentiful dollar supply and greenback weakness (especially if the Fed resorts to lower interest rates, or even a return to quantitative easing, to keep the national debt and associated interest bill manageable).
‘If he succeeds, renewed faith in paper dollars would perhaps lessen even gold bugs’ ardour for the precious metal as a store of value.’
Still to come on Monday’s economic calendar, it’s a quiet afternoon and evening except for housing starts from Canada.
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