Spreadex Market Update
Mining stock magic helps FTSE ignore disappointing trade balance data
Whilst the UK’s trade deficit ostensibly shrank from £12.2 billion in July to £11.1 billion in August, that former figure was revised upwards from £11.1 billion whilst the latter is a significant miss on the £10 billion deficit that had been forecast. Joining the trade deficit in the doghouse was the UK’s construction output, which saw a 4.3% decline (against the 1% increase expected), its biggest month to month fall since December 2012. Yet the continued health of the UK’s commodity stocks, with Glencore (rising 8% after announcing that it would slash its annual zinc output by a third) and Vedanta Resources (up 11% after its positive Q2 production update this morning) leading the charge, allowed the FTSE to hit a 50 point increase as the day continued.
The Eurozone was similarly strong this morning, despite a disappointing Italian industrial production figure adding to the region’s (France-excluding) run of dismal data. The CAC climbed 40 points, whilst the DAX surged 100 points beyond the 10000 it reclaimed at Thursday’s close.
The US futures appear much more tentative than the European markets, with the Dow Jones looking at a mild 20 point jump when the Wall Street bell rings. However, that still keeps the US index above the 17000 level it re-crossed on Thursday, the first time it has touched that psychologically significant level since Black Monday, with American import prices, expected to improve on last month’s 1.8% fall, the only number of note this afternoon.
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