Spreadex Market Update
Thursday flatness as investors search for fresh boost
Before its current flatness set in, the FTSE managed one final surge, breaking through its intraday high and joining the DAX and the Dow in their recent record-breaking form. Yet like those indices, the FTSE couldn’t sustain these highs for long and investors have decided to leave the UK index alone for the time being.
Despite Brent Crude falling back to $55 per barrel after edging higher yesterday, the FTSE’s oil stocks remain in good health following George Osborne’s tasty tax cuts for the North Sea oil industry to the tune of £1.3 billion, a big boost to a sector that has struggled since the oil price crash.
After yesterday’s big gains the US futures are slightly cooler this Thursday, erring into the red as the day continues. With Yellen once again highlighting the importance of job growth, this afternoon’s unemployment claims figure will provide an interesting conundrum for investors. A strong figure will reflect improved health in the jobs sector, something the US is in need of; yet at the same time, a weaker figure would show the sector isn’t achieving the kind of growth the Fed wants, adding to the case for a rate hike delay and potentially pleasing the markets. It is this kind of logic that has caused interest rates to dominate the financial discourse in America since the New Year.
So far little has come from the build up to the EU economic summit, beyond the usual discord between Germany’s wish for Greece to remain on its ‘tough path’ whilst Athens searches (likely in vain) for an ‘honourable compromise’. Yet the Eurozone indices took tentative steps this morning to recovering their Tuesday and Wednesday losses, with a (much) higher than expected targeted LTRO figure reigniting investor confidence in the region.
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