Spreadex Market Update
FTSE and DAX resume decline ahead of Bank of England Brexit warning
Dropping 50 points after the bell the FTSE is now circling 4 month lows, threatening to take out that 5900 level before the day is out. The usual Brexit fears are to blame for the resumption of the index’s decline, with Brent Crude’s dive below $48.50 per barrel failing to help matters either. Data-wise the only really distraction on offer this Thursday is the latest retail sales reading, though given the figure is forecast to fall from 1.3% to 0.3% month-on-month it is unlikely the number will provide a salve for the index’s current issues.
The FTSE could well see its losses intensify as the day goes on with the Bank of England set to stoke those Brexit-fearing fires later this morning with a firmer warning against leaving the EU (the central bank is also expected to unsurprisingly keep interest rates on hold). Mark Carney faced a lot of criticism last time he expressed an opinion on the referendum, so expect an apoplectic reaction from Vote Leave (and perhaps another fall from the pound) as Thursday continues.
Understandably the Eurozone shared the same fate as its UK cousin this morning, the DAX and CAC dropping by 1.2% and 0.9% respectively. It appears that the Eurozone indices and the FTSE are trading in lock-step at the moment, any region-specific nuance lost in the face of the looming referendum.
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