Spreadex Market Update
Investors struggle with decisions after yesterday’s bloodbath
The FTSE continued to languish this morning as investors failed to get behind a recovery for the UK index, instead placing their confidence in the Eurozone. Sustained losses for oil and copper meant that the FTSE’s influential commodity sectors provided no relief for the UK index, with Anglo American, Tullow Oil and Lonmin amongst the big losers this Friday morning, whilst Supergroup gave back some of yesterday’s Idris Elba-inspired gains.
As expected, Mark Carney’s comments this morning provided the biggest draw for the UK markets. The Bank of England governor claimed that the next rate move is ‘likely up’, going against Andrew Haldane’s comments earlier in the week; nevertheless, investors weren’t phased by this slightly muddled message from the central bank, pushing the pound higher against the dollar and the euro after suffering some pre-election jitters earlier in the day.
Whilst the FTSE struggled to change its downward course, the Eurozone went from strength to strength, as the DAX edged closer to re-hitting its much vaunted 12000 level. The euro, on the other hand, continued to suffer at the hands of the dollar after its spirted performance during much of the week.
The US futures remained in the red as Friday continued, with the dollar making steady gains against all the major currencies bar the pound. Things weren’t helped by the Senate passing a Republican budget that intends to implement $5.1 trillion in domestic spending cuts over the next decade, with much of the surplus going on extra military spending. Luckily for the US markets they still have, unlike Europe, some significant announcements this afternoon, with GDP and consumer sentiment data to come; a strong performance in these key figures could lead to a much needed turnaround for the Dow Jones et al.
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