Spreadex Market Update
FTSE finds its rhythm despite woeful UK manufacturing data and a sharp increase in the goods trade deficit
Dropping to -1.1%, a level not seen since August 2014, the UK manufacturing production figure was far, far worse than expected this Friday, calling into question the 0.5% GDP estimates for the first quarter of 2016; the industrial production data wasn’t much better, slipping to -0.3% from a downward-revised 0.2% last month. To make matters worse the goods trade deficit was similarly ropey, widening by nearly £2 billion to £11.96 billion following a sharp increase in imports from the EU (now sitting at a record high of £20 billion). Yet the FTSE was nonplussed, the 3% rebound from Brent Crude helping the index to maintain its near-50 point rise as the morning continued; even the pound showed a surprising resilience, cable edging slightly closer to the $1.41 mark it abandoned yesterday.
The Eurozone indices were even perkier than the FTSE this Friday, the DAX and CAC both pushing for a 1%-plus rises. The main catalyst for this growth seems to have been the strong German trade surplus figures from before the session began, the French industrial production miss quickly forgotten as the day got underway.
Currently the Dow Jones looks set to join in with the end of week rebound, the futures pointing to a 90 point jump at the open. It’s been a rough week for the Dow; after starting April by testing 17800 the index slumped by around 150-200 points, damaging any early hopes that it could re-reach the 18000 mark. Frustratingly there isn’t much for the US index to work with this afternoon either, a speech from Fed vice-chair William Dudley arguably the only thing of note.
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