Spreadex Market Update
European indices continue to rebound after Thursday’s post-Draghi dizziness
Despite a widening UK trade deficit (thanks to the continually lopsided relationship between the country’s imports and exports) AND a set of slashed growth forecasts from the British Chambers of Commerce (expectations for 2016 now at 2.2% from the previously stated 2.5%, with 2017 cut to 2.3%) the FTSE maintained its 1.4% rise this Friday. The main thrust of the index’s growth appeared to come from the commodity sector, Brent Crude teasing $41 per barrel and lifting the UK oil and mining stocks alongside it.
After seeing similar gains after the bell the Eurozone indices roared ahead of their UK peer this Friday, the DAX and CAC now both up 2.5%, the kind of post-ECB announcement growth that swiftly disappeared when Draghi revealed the central bank’s lack of appetite for cutting interest rates any further. It appears that Friday morning’s trading is far more in line with what Draghi and co. would have expected from the markets than what eventually transpired on Thursday afternoon, with the indices soaring as the euro sinks against both the pound and the dollar.
Set to join in with Friday’s course-correction is the Dow Jones, the futures pointing at a 150 point jump when the bell rings on Wall Street. The US index ended up being just as volatile as its European counterparts on Thursday, Brent Crude’s post-OPEC/non-OPEC talks-collapse sending the Dow to intraday lows not seen since the start of the month. Today, however, it seems that a big plate of bullishness is on the menu, though the index will have to deal with its latest import prices figures before it can officially join in with the day’s gains.
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