Spreadex Market Update
FTSE and pound diverge as Boris says bye-bye to Tory leadership bid
By refusing to run for leader Boris Johnson has caused the Conservatives to lose their heir apparent, arguably leaving a tighter, potentially more uncertain, race between Theresa May and Michael Gove. Yet on the other hand May and Gove have far more ministerial experience, and a far less testy relationship with the EU, than Boris, meaning the choice between the two may be preferable to a Big Johnson taking the big job.
Regardless there has been a distinct correlation between Johnson’s announcement and a decidedly nervier showing from the markets; the FTSE has fluctuated between 0.3% and 0.6% having grazed a 1% rise around lunchtime, while the pound has tipped back into negative territory against the dollar despite a post-Boris statement spike. Over in the Eurozone the jitters are more pronounced, the DAX slipping by 0.1% with the CAC just about dipping back under 4200.
It didn’t help that the US open was so underwhelming, the Dow Jones jumping a mere 0.2% after the bell. To be fair to the Dow it didn’t have a lot to work with, the Chicago PMI (which jumped to a 10 month high of 56.8) the only number of note.
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