US equity markets finished yesterday mixed, with the Dow Jones outperforming as DuPont and Dow Chemicals’ merger expects to get the green light, while the Fed minutes failed to provide markets with any further information on the date of its next rate hike. The S&P closed 0.1% lower in its worst performance since 6 Feb as rallying Utilities were unable offset weakness from Energy names, while the Nasdaq also finished weaker by 0.1%, its worst showing since 2 Feb.
Accendo Markets Analyst, Mike Van Dulken commented – “In focus today will be fallout from last night’s Fed minutes which were taken as less hawkish than the meeting itself. While reiterating that rate hikes should come sooner rather than later, the minutes also pointed towards uncertainty from incoming Trump administration policies that could impact the Fed’s decision making before the next meeting. As such, all meetings remain live, however we are left no more enlightened as to when exactly the next hike will come.”
In the UK, the FTSE has been muted this morning, once again failing to substantially break through the 7300 resistance level. There wasn’t much excitement from the pound either, sterling sitting flat-ish at 1.245 against the dollar while flirting with 1.18 against the euro.
Spreadex Analyst Connor Campbell noted – “After the mood-dampening, if superficially impressive, GDP reading yesterday, the UK has little to deal with today explaining the rather snooze-worthy start to the session.”
As for equities, the main focus this Thursday was on the banking sector again. This time, it’s Barclays, the latest to reveal its annual results. The company posted figures that are closer to the Lloyds than HSBC end of the scale – full year pre-tax profit nearly trebled to £3.2 billion, thanks to the fact that its conduct charges more than fell to more than third of what they were in 2015, from £4.4 billion to £1.4 billion. Elsewhere Barclays’ performance wasn’t quite so perky, with revenue dropping 3% to £21.5 billion and dividends slipping from 6.5p to 3p; however the surge in profit was enough for investors, who sent the bank 3.3% higher to a fresh 15 month high.
The Euro will be in focus too, following the withdrawal of centrist candidate Francois Bayrou in France, who decided to pull out of the race and support Emmanuel Macron for the presidency. This fresh development could diminish the likelihood of a far-right Marie Le Pen presidency, and the Euro benefited from this news.
ADS Securities Analyst, Konstantinos Anthis commented – “It will be interesting to see whether this push higher will continue today, building on Dollar’s muted reaction to the Fed minutes.”
