Spreadex Market Update
Pound continues to plunge but mix of miners and Home Retail Group lifts FTSE
Whilst the jovial Johnson has roundly rogered sterling this Monday following his Brexit-backing bombshell, causing the pound to sink to a 15 month low against a basket of currencies following investors’ violent (and arguably over-pronounced) reaction, the FTSE held strong, starting off the busiest earnings week of the season (nearly a fifth of the index’s top 100 reporting in the next few days) in style.
Though HSBC may have joined its European banking peers by disappointing investors, a solid Primark-inspired rise from Associated British Foods (despite the company warning its half year earnings would be softer than expected) and a 12.5% surge from the takeover-teasing Home Retail Group (following news that South Africa’s Steinhoff has rivalled Sainsbury’s earlier offer ahead of the company’s shareholder meeting on Thursday) have, alongside a robust morning from the miners, helped the FTSE maintain its near 1.5% increase.
Things were just as buoyant over in the Eurozone, the DAX and CAC rising between 1.9-2.1%, despite a generally mixed morning for the region’s latest PMIs. France’s flash manufacturing PMI was the only number to see a notable improvement, with a sharp drop in German manufacturing and relatively stagnant services data causing the region-wide figures to fall to 13 month lows.
The US markets look ready to join in with the positive start to the week, the Dow Jones currently set for a near 200 point jump to a fresh 6 and a half week peak when the American session gets underway. A fairly quiet afternoon then sees the US flash manufacturing PMI as the only figure of note, analysts expecting a slight fall to 52.3 from 52.4 last month.
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