The Morning Call - U.S.30 falls 1000 points again as government shuts down for second time

Highlights of the Day

Asian Markets

China’s stock market benchmark plunged 5.5% on Friday and other Asian markets were off sharply after the Wall Street plummeted more than 1,000 points, deepening a weeklong sell-off.

U.S. Markets

The U.S.30 dropped 1,033 points, its second-worst drop in history, extending its losses in the recent sell-off to more than 10% and putting it officially into correction territory.

Today's News

The US government has officially shut down for the second time this year because Congress failed to meet a deadline to vote on a new budget. Senators struggled with last-minute objections from Republican Rand Paul, but have now passed the bill, which has gone to the House for its vote. Federal funding for government services expired at midnight (05:00 GMT). The 600-page plan proposes an increase in spending, by about $300bn, on defence and domestic services. If the plan is passed in the House of Representatives and signed by the president in the next few hours, the shutdown could be rescinded before the US working day begins on Friday.

Shaftesbury said that it has seen continuing high footfall and “robust” trading in the period from 1 October 2017 to 8 February 2018. In a trading update ahead of its annual general meeting later in the day, the company said occupancy levels remain high, while leasing activity remains strong. During the first quarter, lettings, renewals and rent reviews totalled £7.7m, achieving rental levels ahead of estimated rental values at 30 September 2017.

Victrex reported a very strong start to the year, with industrial sales led by consumer electronics to offset slightly weaker performance from medical customers. First quarter revenue of £78.7m was up 41% on the prior year as sales volumes increased 30% to 1,051 tonnes, though the comparative period was quite weak.

British Land Co said it has acquired the Woolwich Estate in London for a headline price of £103.0m, representing a net initial yield of 4.1%. The real estate investment company said the acquisition – which covers 4.9 acres in south east London – is in line with its strategy of focusing on well-connected, mixed use assets, and expands its existing London portfolio. The estate covers 360,000 square feet of space in central Woolwich, comprising 56 retail units. It also includes over 50,000 square feet of residential and 3,000 square feet of office space.

Trinity Mirror said on it will buy the publishing assets of Northern & Shell – which owns titles such as the ‘Daily Express’, ‘Sunday Express’ and ‘OK!’ magazine – for £126.7m. The proposed acquisition will see Trinity Mirror pay an initial £47.7m in cash, another £59.0m in deferred cash payable over 2020 to 2023, and £20.0m through the issue of 25.8 million Trinity shares.

SSE announced it has secured 4,177 megawatts of electricity generation capacity in the GB capacity market auction, though it is to review the long-term future of its Fiddler’s Ferry station. The electricity, which covers the period October 2021 to September 2022, was secured at a price of GBP8.40 per kilowatt. The total value secured by SSE is approximately £35.1m.

Gold held steady amid tumbling equity markets, but a firmer dollar and worries about rising global interest rates dragged on prices.

Oil Prices fell for a sixth day after Iran announced plans to boost production and U.S. crude output hit record highs, adding to concerns about a sharp rise in global supplies.

Companies Reporting this week

Day	Companies
Tuesday:	Ocado * BP * St Modwen * BNP Paribas * Munich Re
Wednesday:	Rio Tinto * Tullow Oil * Smurfit Kappa * GlaxoSmithKline
Thursday:	Beazley * Smith & Nephew * Total

Early Market Movements

Market	Index	Change	% Change
UK 100	7,138.9	-31.8	-0.4%
UK 250	19,253.7	-74.0	-0.4%
GER 30	12,245.7	-14.6	-0.1%
FRA 40	5,134.2	-17.5	-0.3%
U.S. 30	23,860.46	-1,032.89	-4.2%
U.S. 500	2,581.0	-100.7	-3.8%
OIL (BRENT)	64.28	-0.53	-0.8%
GOLD	1,315.08	-3.68	+0.3%

UK Risers & Fallers (8:15am)

Company	Price	Change	% Change
Relx	1485	+11	+0.8%
Taylor Wimpey	183.3	+1.35	+0.7%
Millenium & Copthorne	540.5	+9.5	+1.8%
Scottish Mortgage Investment Trust	420.4	-13	-3%
Johnson Matthey	3161	-90	-2.8%
Nostrum Oil & Gas	250.25	-9.75	-3.8%

Latest Broker Views

Company	Broker	Recommendation	Price	Target
GlaxoSmithKline	Berenberg	Buy	1303.8	1705
Compass Group	Goldman Sachs	Neutral	1513.5	1620
Ashtead Group	JPMorgan	Neutral	1955	2600
Pearson	Goldman Sachs	Sell	681	542