Oil prices won't top $100 in the next decade, OPEC predicts

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Crude will stay below the $100-a-barrel (bbl) level for at least the next 10 years, according to the Organization of Petroleum Exporting Countries (OPEC). Read More

Market buzz: Pound pops on EU transition deal, Facebook falls
Monday 19 Mar 2018

(ShareCast News) - 1700:Close The top tier index started the week on a weak note amid a near perfect storm of pound strength, soft base metals' prices, a twitter-storm on Capitol Hill at the weekend and ongoing trade and geopolitical frictions. Somewhat ironically, the chief trigger behind the downdraft in London-listed stocks was a relative 'positive' for the economy, in the form an understanding between Brussels and Westminster on the broad contours of the post-Brexit transition deal. If for metals it was narrower gains in Chinese house prices, by regions, that appeared to do the trick, in the tech space it was news of increased scrutiny on the part of from authorities in the UK, EU and US into big techs' use of client data that undermined sentiment towards the sector, globally, resulting in big losses for Facebook and Google shares. Back home, losses in the tech space centred on Micro Focus, whose shares nearly halved in value, and Sophos Group. Over in the States meanwhile, investors were also digesting the news-flow over the weekend concerning the Russia probe. 1528: The Chicago Board of Options Exchange's VIX volatility index is up by 26.39% to 19.97 points as the Nasdaq Composite gives up 2.37% or 175.05 points to 7,308.48. Latest headline .. EU said to pledge to probe Facebook's handling of user data. 1527: LCG's Jasper Lawler pointing out a potential so-called 'death cross' technical pattern (when the 50-day moving average crosses the 200-day average to the downside) forming in German Dax. 1500: Commenting on Friday's FDA Advanced Notice of Proposed Rulemaking relating to its aim of lowering nicotine levels in cigarettes, JP Morgan said they were coming "neutral to slightly worse than our base case." In any case, tobacco stocks are now near the bottom of the pile on the FTSE 350, right behind Software& Computer Services and Mining. 1341: Facebook stock has fallen 5% after authorities on both sides of the Atlantic demanded questions on why personal information on 50m users of the social media site were leaked to UK that helped the Vote Leave and Trump presidential campaigns in 2016. Authorities are calling for Facebook's CEO Mark Zuckerberg to explain how the personal information of millions of its users ended was without their permission or knowledge, while a parliamentary committee investigating fake news has accused both companies of misleading MPs. 1205: Britain and the European Union have agreed a 21-month Brexit transition deal to smooth the break-up after March 2019, though the Irish border remains one of several issues not yet resolved. The two sides have agreed a draft legal text for a transition deal once Britain splits from the bloc in March 2019, with Britain continuing to operate under all single market rules and judgments from the European Court of Justice until the end of 2020, while having no further say in future EU decisions. 1128: The pound has popped back up above $1.40 this morning after reports that the EU has agreed on "the broad terms" of a two-year Brexit transition deal. 1120: Big pension news: the Department for Work and Pensions has published proposals to strengthen the UK's defined benefit pension schemes. This comes on the back of last year's green paper exploring what could be done to address questions of employer contributions and affordability, funding and investment, member protection and scheme consolidation. Tom McPhail, head of policy at Hargreaves Lansdown says: "No one wants to see recurrences of the problems and uncertainties which have undermined the retirement security of employees at companies like BHS, Carillion and Toys R Us in recent months. The government is looking to minimise the risk of such occurrences by giving the Pensions Regulator greater powers of scrutiny and by putting company directors on notice that if they neglect the interests of their employees' pensions they could find themselves in court facing criminal charges." 1027: Three-month LME copper futures are at $6,826 per tonne, versus $6,950 at the end of the previous week. New home prices rose in 44 cities in February, down from 52 in January, according to China's National Bureau of Statistics. 0944: Ahead of a meeting between David Davis and chief EU negotiator Michel Barnier, due shortly after 1100 GMT, Reuters cites good progress from talks over the weekend to resolve an impasse over the Irish border, according to "several EU officials". However, one "senior" EU source cited by that same newswire labelled talk of a deal being agreed at this week's EU summit as 'hype'. On that note, and given the prospect that no deal on a transition period is likely before October, analysts at BNY Mellon are taking a bit of an issue with the "curiously" muted risk in GBP as reflected in effectively flat speculative positions in the currency and implied volatility on six and 12-month ATMF at levels well below their long-run averages. 0848: Barclays is on the front foot this morning as it emerges that activist investor Sherborne Investors has acquired 5.2% of the voting rights in the bank. The London open market report shows the FTSE 100 down 75 points or just over 1% ahead of potential fireworks later in the week, with economic data, G-20 statements and central bank meetings all threatening to move markets. In the broker note action, there's an upgrade for AstraZeneca from Jefferies, with Rotork also lifted to 'buy' at Peel Hunt. Close Brothers was cut to 'hold' by Berenberg. 0830: Micro Focus shares have nosedived 44% so far this morning after the software company cut its revenue guidance for the current year due to some hiccups six months into the integration of its massive HPE Software acquisition. Chris Hsu, the former HPE man who was made CEO of Micro Focus on completion of the deal last September, is departing immediately "to spend more time with his family and pursue another opportunity", meaning chief operating officer Stephen Murdoch will regain his former role of CEO with immediate effect and deal with a rate of revenue decline "has been greater than anticipated" due to several factors. 0820: Hammerson shares have rocketed 26% after the retail property developer rejected a bid from France's Klepierre. The 615p a share offer, which represents a premium of around 40.7% to Hammerson's closing price last Friday, was made on 8 March the French firm said on Monday. 0803: There's relief for bookmakers Ladbrokes and William Hill, according to the papers, who had been fearing the results of the government's triennial review on fixed-odds betting terminals. "It looks like ministers will blink first", says analyst Neil Wilson at ETX Capital after a report in the Times said the bookies will get away with more lenient limits on stakes than was feared. "Bookies are being called to open higher with the Gambling Commission recommending maximum stakes on fixed-odds betting terminals should be cut to £30, not the £2 as feared. This should be a relief for the sector as the worst-case scenario looks to have been avoided." The newspaper says ministers will now have to justify a cut below £30 on grounds of significant risk of harm. 0757: Looking the week ahead, markets are expected to have a quiet start to the week before we later see both the Bank of England and the Federal Reserve set to meet to decide on interest rates. With the G20 finance minister's meetings in Buenos Aires on Monday and Tuesday searching for ways to avoid a global trade war, a barrage of UK and US data over the week and the central bank decisions, "the volatility that we have seen since the beginning of February is likely to pick up again heading towards mid-week" says Jasper Lawler at London Capital Group. "In the forex markets the dollar has started the week higher ahead of Wednesday's Fed rate announcement, the first under new Fed Chair, Jerome Powell. Whilst a rate hike in March is 94.4% priced in according to the CME Fed Watch, investors will be paying particular attention to the Fed's future path of hikes. Any signs of four rate rises on the Fed's dot plot, over the three which the Fed had initially assumed for the year is expected to push the dollar higher, with USD/JPY potentially rising towards 108. After a certain amount of thumb twiddling last week, pound traders are set for a busy week with inflation data, wages growth figures and the BoE rate decision all due." LCG expects the FTSE 100 to open 24 points lower at 7140 today. 0705: A "global bidding war" for Nex Group will kick off after the takeover approach from CME Group last week, says the Daily Telegraph. "Senior City sources said all the big players were rushing to work out whether they could gatecrash the talks with a higher offer," the reports says, with the favourite being CME's big rival, the ICE. Elsewhere, there's a story of interest to investors in Provident, Morses Club and Non-Standard Finance, with Citizens Advice calling for Britons saddled with high-interest "doorstep loans" should be given the same protection as people with payday loans and be saved millions of pounds' worth of excess charges a year. That story from the Guardian. 0645: Big surprise of the morning: Vladimir Putin has won more than 76% of the vote in the Russian election, the Central elections commission has said, with ballots counted from almost two thirds of the country. His campaign team are claiming that turnout was bolstered by the confrontation with Britain over the poisoning of Sergei Skripal. Looking at the ECB, Bundesbank president Jens Weidmann said in a German newspaper interview, published today: "I personally think that the good economic developments and the inflation forecast would allow a rapid end to the bond purchases".

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