Spreadex Market Update
Pound widens rebound against dollar and euro; US ADP non-farm to come
Maintaining a 15 to 20 point fall the FTSE couldn’t do much of anything this Wednesday, hampered by a red-tinged mining sector and a rebounding pound. Talking of sterling the currency widened its gains as the morning went on, taking nearly half a percent off the dollar and 0.3% off the euro.
There was a bit more intrigue in the Eurozone, with the release of the latest region-wide inflation figure. Coming in at 0.2% against the 0.3% expected (with the core reading also missing estimates), the news seems to have given a bit more credence to reports that the ECB will reveal something kind of stimulus extension next week. That logic explains the euro’s weakened showing against the pound, while also causing the DAX to lift away from its lows and the CAC to top the morning’s best performer table with a 0.4% rise.
Looking ahead to the US session and investors will have a bit more to work with, the afternoon bringing with it the ADP non-farm employment change reading, the Chicago PMI and the latest pending home sales figure. The first of those is the most important, especially since investors are relatively unclear about the likelihood of a 2016 rate rise from the Fed. Analysts are expecting the number to come in at 174k, lower than last month’s 179k and potentially a signal that Friday’s government-released figure may not be as stellar as the one seen in July.
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