Spreadex Market Update
European sell-off accelerates as commodity reversal joins Brexit referendum jitters
With Brent Crude dipping below $51.50 per barrel, and the commodity sector rapidly losing the gains seen at the start of the week, the FTSE plunged over 100 points this Friday. That’s left the UK index a mere 30 points above 6100, a price the FTSE hasn’t seen since the 3rd week of May. Finding a clear, concrete reason for this violent investor reaction is difficult; rather it seems that the commodity reversal, alongside a sharp decline from the financial sector, has joined the pre-referendum jitters to produce a bearish weight the markets are unable to handle.
The Eurozone indices bested the FTSE in the poor performance stakes this morning, the DAX and CAC dropping a whopping 2.1% and 1.8% respectively. Like the UK index that leaves both at their worst price since May 24th, fears of a Brexit taking hold of the Eurozone indices in a way that hasn’t previously been seen.
The Dow Jones looks set to get in on this slump later this afternoon, the futures pointing to a 0.5% fall after the bell. The index does have some data that could change the tone of its trading once the US session begins. Then again, with the preliminary UoM consumer sentiment reading expected to slip to 94.1 from an already downwards-revised 94.7 last month, maybe not.
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