Spreadex Market Update
Weak production data dents FTSE’s record-eyeing run
The overall negative trend of this data led to fears of a weakened UK GDP for the first quarter of 2015, some indication of which should be provided this afternoon when the NIESR GDP estimate is released.
The weak production news was more disastrous for the pound than the FTSE, as it caused sterling to hit a 5 year low after already struggling throughout Thursday. The election uncertainty is providing an unstable base for the pound, so negative economic data for the UK is having more acute effects on sterling’s tender underbelly than normal.
Whilst the FTSE suffered a minor setback, the DAX was on a tear this afternoon, pushing forth with its latest set of 3 digit gains. The rest of the Eurozone was also in the green, if not quite as robust as the German index, with little in the way of news to detract from investors’ post-Greek IMF payment confidence. However, there was one interesting titbit to arise this morning; The Times is reporting that the major Eurozone nations are secretly drawing up plans to rid the Eurozone of Greece as it faces bankruptcy, a prospect that might be more pleasing to the Eurozone indices than it once was.
Yet if the Eurozone indices looked confident, then the euro has continued to be a depository for the region’s fears, with the currency slipping against both the rampant dollar and the relatively meek pound.
The US futures, as has been the trend of late, failed to match the thrust of the European markets, tentatively posting slender gains ahead of this afternoon’s import prices and, more importantly, comments from the Fed’s Jeffrey Lacker. Lacker is one of the Fed’s most hawkish members, stating at the end of March that ‘the case for raising rates will remain strong at the June meeting’; the reiteration of this sentiment this afternoon could lend extra strength to an already muscular Friday performance from the dollar.
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