Spreadex Market Update
Thin volumes plus renewed hopes of avoiding a Brexit see FTSE and pound hit fresh highs
Easily outperforming expectations the FTSE rose nearly 1% this morning to hit a fresh 2 month high, a remarkable feat given the Brexit fear that has defined much of June. If the FTSE was impressive then the pound was something else; cable jumped another 1.3%, clearing yesterday’s highs to at one point hit $1.48909, its highest price since the very end of December last year. The strength of this surge is likely down to vastly reduced liquidity and, of course, leaves the markets with an even bigger drop-off if Britain opts out of the EU. At the same time, however, today’s gains still paint a stark contrast to the lows struck last week, suggesting investors continue to expect Remain to prevail come tomorrow morning.
Not wanting to be left behind the Eurozone indices went beyond the FTSE’s gains this Thursday despite a woeful set of manufacturing and services PMIs across the region, so bad in fact the Markit composite PMI hit a 17 month low of 52.8. The DAX jumped 150 points to graze 10300 for the first time since the start of the month, while the CAC barrelled towards 4500 with a 1.5% rise.
Looking ahead to the US open the Dow Jones is ready to get in on the action, the futures pointing to a 180-point, 18000-appraoching rise after the bell. The US session also provides investors with a few nibbles of data to tide them over, the jobless claims, flash manufacturing PMI and new home sales figures sprinkled throughout the afternoon.
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