Spreadex Market Update
Stellar UK jobs report boosts pound, key US inflation figure still to come
An increase in the claimant count change was the only weak spot, as wage growth hit a 6 year high of 2.9% whilst the unemployment rate fell back to 5.5% for the first time in 3 months. This prompted the FTSE to approach 6200 (even if it couldn’t quite sustain its session highs), aided by an over-20% jump for SABMiller following confirmation that the company had been approached by drinks-behemoth Anheuser-Busch InBev about a potential £160 billion (!!!) merger.
The Eurozone’s morning news wasn’t quite as great as the UK’s, as its region-wide inflation unexpectedly fell to 0.1%. Yet whilst this slightly dampened the region’s growth (especially for the DAX) the increased chances of further ECB QE saw the Eurozone indices by and large hold onto their gains, whilst simultaneously causing the euro to fall around half a percent against the dollar.
Currently investors seem wary of pushing the Dow futures one way or the other ahead of this afternoon’s inflation data. The figure is expected to fall to zero, cementing 4 months of consecutive contraction and, in theory, providing another boost to the dovish side of the interest rate divide. Yet the potential for a better than expected figure has so far left the Dow futures flat, something that has begun to weigh on the European indices as the US open gains proximity.
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