Spreadex Market Update
Dismal UK manufacturing figures can’t dissuade investors this Wednesday morning
UK manufacturing production fell to -0.8% against the 0.2% increase that was expected, whilst industrial production saw a similar drop to -0.4% compared the 0.1% growth forecast. This, alongside a substantial widening of the trade deficit to £11.1 billion (the biggest in over a year as exports dropped 10%), provided another damning morning for the so-called ‘march of the makers’ and provides further confirmation that the UK economy remains dangerously skewed towards services and consumer growth. It also has caused analysts to speculate that the UK’s third quarter GDP could fall to 0.5% compared to the 0.7% growth from Q2, with today’s data the latest in a string of weak figures suggesting a slowdown.
Yet investors remained focused on the good news from today’s Asian session, with the FTSE never straying too far from its 100 point increase; the DAX meanwhile, has cooled somewhat but is still up over 150 points, whilst the CAC is holding onto a firm 2%-plus increase.
The US open looks set to continue the buoyant market atmosphere this afternoon, with the Dow futures suggesting a 150 point jump when the Wall Street bell rings. It will likely be another quiet afternoon for the markets; only the JOLTS job openings has the capacity to really move the markets, an ability that has perhaps increased due to the proximity of next week’s potentially decisive Fed meeting. Whilst the figure is unlikely to surprise too much given that the non-farm figures were only released last Friday, it could help give a bit of clarity to a jobs report that left many investors scratching their heads.
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