THE TIPSTER

 
Philip Salter
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SILVER saw its biggest drop since 1980 on Thursday and has declined a massive 30 per cent since hitting its all time high at the end of April. The unwritten rule is that a fall of 20 per cent marks the start of a new bear market, but considering that the bulk of the selling has been down to increases in margin requirements set by the CME, this could present a buying opportunity, although it is definitely one for the brave trader. Capital Spreads quotes $34.90-$34.93 for July silver.

Imperial Tobacco was lifted last week on the back of positive comments from Morgan Stanley. Goldman also recently said it was a likely takeover target, and the stock has hit 2,159p, a level not seen since March 2010. This level proved to be strong resistance back then and with the RSI and MACD in overbought territory, a sell of Imperial Tobacco is recommended with 2,000p the target. Spread Co quotes 2,154.4p-2,158.6p.

With Lloyds Banking Group announcing provisions worth £3.2bn on possible payments for misselling Payment Protection Insurance (PPI), the market aggressively knocked down the price on Thursday. The amount that Lloyds has set aside is considerably larger than the analysts were expecting and this raises the question of whether it is cheap. WorldSpreads offers 53.65p-53.77p.

Greggs, the baker, comes out with an interim management statement on Wednesday and despite the already impressive growth in the company’s share price over the last couple of years, analysts remain upbeat over the outlook. Admittedly, commodity prices remain high, but the company has previously said it is well hedged in this regard, so this has the potential to help keep its competitive edge. Current IG Index price is 503.7p-507.3p.

Sainsbury’s shares have been recovering over the past month after falling to near 9-month lows of 330p at the start of April. The supermarket is likely to follow rival Tesco’s lead in reporting a slowdown and possible drop in sales when it reports on Wednesday. However, on the back of recent talk of a possible bid for Iceland, spread betters have been in optimistic mood, buying the stock at around the 350p level. Spreadex has a rolling Sainsbury’s contract with a spread of 352.70p-353.70p.