Spreadex Market Update
FTSE and DAX fall ahead of UK inflation and Eurozone ZEW economic sentiment data
Slipping 0.3% to 0.4% after the bell the FTSE is still struggling to burst through 6700 with any real conviction; since nearing that level last Monday the index has almost only seen lateral movement, and is crying out for something to spark a break-out. It is debatable whether or not the Tuesday’s juiciest bit of UK data, i.e. the inflation reading for June, can provide that much needed catalyst. The figure is expected to creep up to 0.4% from 0.3% month-on-month (the first signs of the post-Brexit pound plunge taking effect), though that may do more damage to sterling than it does good for the FTSE.
Talking of the pound the currency fell by 0.3% against both the dollar and the euro in the early hours of the day’s trading. That still leaves it above $1.32 and €1.19 respectively, though does suggest a brief flash of nerves ahead of those aforementioned inflation readings.
Looking across to the continent and the DAX and CAC look pretty weary this Tuesday, both dropping 0.6% after the bell. Like the UK the Eurozone is dealing with some important data this morning in the form of the German and region-wide ZEW economic sentiment readings. The former is expected to see a sharp decline from 19.2 to 8.2 month-on-month, with the latter set to drop from 20.2 to 12.3. It must be noted that in the past few months analysts’ estimates have been pretty inaccurate in terms of these ZEW economic sentiment figures, so the markets could end up with a completely different set of numbers.
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