Market News & Analysis
Abandoned LSE bid sinks FTSE
Fiona Cincotta October 8, 2019 5:05 PM
The Hong Kong Exchanges and Clearing’s attempt to buy the London Stock Exchange, which was being stalled for months by the LSE, has now officially been dropped, causing the exchange’s shares to decline 6.28%. HKEx under the helm of chief executive Charles Li has been on an expansion drive both East and West for years, acquiring the London Metal Exchange in 2012 and later expanding its trading link with mainland China through Shanghai Stock Connect.
But the attempt to take over the LSE proved a step too far as the London exchange fended off the bid that would have created a $70 billion company suspecting that eventually HKEx’s links to the local government would have led to political interference in the markets.
Though initially hit, LSE shares started gradually picking up. More importantly, the decline made barely any dent in this year’s rise in the exchange’s share price which went from barely 4,000 a year ago to just under 7,000 this morning.
Airlines were also hit after EasyJet reported profits at the high end of expectations but the counter-intuitive move was a reaction to the trade update highlighting problems across the airline sector.
The pound continues to decline as the PM is positioning himself for a standoff with the EU. Attempts to negotiate a Brexit deal will have to come to some sort of resolution by next week when the great and good of the EU gather for the EU summit on 17 October and then 19 October when MPs will have to approve any potential but unlikely new deal. Currency markets are clearly not holding out much hope as sterling is slipping both against the dollar and the euro.
Please note these products may not be available to trade in all regions.
This report is intended for general circulation only. It should not be construed as a recommendation, or an offer (or solicitation of an offer) to buy or sell any financial products. The information provided does not take into account your specific investment objectives, financial situation or particular needs. Before you act on any recommendation that may be contained in this report, independent advice ought to be sought from a financial adviser regarding the suitability of the investment product, taking into account your specific investment objectives, financial situation or particular needs.
GAIN Capital Singapore Pte. Ltd., may distribute reports produced by its respective foreign entities or affiliates within the GAIN Capital group of companies or third parties pursuant to an arrangement under Regulation 32C of the Financial Advisers Regulations. Where the report is distributed to a person in Singapore who is not an accredited investor, expert investor or an institutional investor (as defined in the Securities Futures Act), GAIN Capital Singapore Pte. Ltd. accepts legal responsibility to such persons for the contents of the report only to the extent required by law. Singapore recipients should contact GAIN Capital Singapore Pte. Ltd. at 6826 9988 for matters arising from, or in connection with the report.
In the case of all other recipients of this report, to the extent permitted by applicable laws and regulations neither GAIN Capital Singapore Pte. Ltd. nor its associated companies will be responsible or liable for any loss or damage incurred arising out of, or in connection with, any use of the information contained in this report and all such liability is hereby expressly disclaimed. No representation or warranty is made, express or implied, that the content of this report is complete or accurate.
GAIN Capital Singapore Pte. Ltd. is not under any obligation to update this report.
Trading CFDs and FX on margin carries a high level of risk that may not be suitable for some investors. Consider your investment objectives, level of experience, financial resources, risk appetite and other relevant circumstances carefully. The possibility exists that you could lose some or all of your investments, including your initial deposits. If in doubt, please seek independent expert advice. Visit cityindex.com.sg for the complete Risk Disclosure Statement.
Cryptocurrencies are not legal tender currency and trading of derivatives on Cryptocurrencies are currently not covered under any regulatory regime in Singapore. Consequently, investors should be aware they do not have protection under the Securities and Futures Act (Cap. 289). Please ensure that you are fully aware of the risks.