Market Prognosis

A concise summary of the major macro events of the past 24 hours, and selected UK company-specific news.

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January 9, 2024

Oil prices fall, Bitcoin ETFs expected & war gamers are having fun

Macro & Overnight

Oil prices dropped sharply yesterday as OPEC+ struggles to maintain production discipline, evidenced by Angola splitting away from the producer cartel last month.

This week’s main macro focus remains on Thursday’s US inflation data. Expectations are for the year-on-year headline rate to be unchanged from last month’s 3.2%.

Equity markets were strong overnight, led by US technology. Nvidia was up 6% and announced a new AI chipset for PCs, while the broader US market was in a risk-on mood.

Bitcoin continued its upward price move amid growing speculation of SEC permitting spot Bitcoin ETFs as soon as tomorrow. It is up 10% YTD.

UK Company News

Games Workshop updated that employee morale is good, and its hobbyists are having fun, too, but not much fun was reported elsewhere in the UK today. 

Recruitment stocks were marked lower as Hays warned of a hiring slowdown. 

Jupiter warned that retail investors continue to withdraw funds from equity markets and has made some changes to its fund manager lineup. 

Low-cost house builder and land development company MJ Gleeson completed the sale of 769 homes during the half-year, 14% fewer than last year. However, it entered the second half with a much stronger forward-order book. But it also warned that full-year gross margins are now expected to fall from previous expectations due to higher selling incentives and longer sales cycles. Against the backdrop of stabilising interest rates, the Board anticipates a recovery in demand for low-cost housing in the seasonally busier selling period over the coming weeks and months.

Gleeson shares and those for other housebuilders led the recovery in the UK market over recent weeks on hopes of lower rates. Today’s news is mixed with confirmation of a strongly recovering top line. However, higher-than-expected costs in 2023 mean the recovery in profits is happening from a lower base than previously believed. 

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