The European indexes were off to a healthy start this morning with the FTSE, DAX and CAC up 0.4%, 0.6% and 0.2% respectively. This follows after a positive finish on Wall St lead on Friday and a strong showing from Asian bourses.
There’s very little in the way of key data to influence proceedings so the European markets may be at the mercy of Brent Crude prices should the commodity fail to maintain it’s momentum today.
The US Dollar is in focus today following Friday’s Non-Farm Payroll report which is seeing the currency make positive gains. “The labor market report was relatively mixed” commented ADS Securities Analyst, Konstantinos Anthis, “with a surprise higher in the absolute number of jobs added last month but a marginal uptick in the unemployment rate and a slowdown in wage growth.”
“investors are focusing on the bullish headline number of added jobs and disregard the bearish highlights influenced by Fed’s positive guidance. The overall consensus is that the strong NFP report will play nicely into Fed’s hands and strengthen their views in favour of another rate hike this year hence the dollar is posting gains against its peers.”
Gold has fallen to a fresh 4-month lows as investors weigh up the prospect of more interest rate increases following positive noises from the central bank. Accendo Markets Analyst, Mike van Dulken commented “Non-yielding safe-haven assets such as gold have suffered as markets begin to price in higher interest rates in both North America and Europe.”
“Despite holding up at $1205 support for the moment, note the emergence of a potential bearish flag pattern which, if completed, would take the precious metal below $1200 to around $1190.”
US equity markets closed higher on Friday following the much better than expected Non-Farm Payrolls figure, offsetting the weaker wages growth. Mike van Dulken added “The Dow Jones closed just shy of 100pts higher to cap off a positive week thanks to strength in McDonald’s offsetting Financial weakness, while the S&P500’s Tech sector outperformed to lift the index 0.6% higher, a performance echoed by the Nasdaq, the best-performing index of the day, up 1.0%.”