The FTSE is down 44 points in early trading as the pound continues its positive trend for the week against the Dollar. Investors are awaiting the release of the US CPI report later today which will provide further direction for the FTSE and the Pound this afternoon.
The biggest single contributor the the FTSE’s fall this morning is GKN. The Engineering group posted a profits warning in light of difficulties in its US aerospace arm and legal claims that could result in costs of up to £40m. The GKN share price was down almost 6% at the time of writing, trading at 332.05.
With the release of the US Consumer Price Index report, the Dollar is set to be the major focus for investors today. FxPro analyst, Edward Anderson suggested “With Thursday’s improvement in US PPI the markets are eagerly awaiting today’s CPI to see if such inflationary pressures are reaching consumers.”
“The improvement in US Jobless Claims has many expecting the strong labour market will help add more inflationary pressure on the US economy and provide further confirmation for the Fed to hike rates.”
The figures are likely to be affected by the recent US hurricanes but the underlying trend in inflation and consumer spending is expected to provide direction for the Dollar against it’s major currency pairings today.
The US equity markets retreated from their fresh all-time intraday highs yesterday to close short of Wednesday’s record closes as earnings season begins in earnest. Accendo Markets analyst, Mike van Dulken noted “All three major US indices closed 0.1-0.2% lower following results from JPMorgan and Citigroup, with the former weighing on the Dow Jones alongside peer Goldman Sachs and UnitedHealth, while the latter weighed on the S&P500 alongside major Telecom names.”
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