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Post-Fed relief intensifies as FTSE crosses 6900 for first time in a fortnight

The post-Fed relief only intensified Thursday morning, the European markets all extending their gains as the session went on.

It’s a sign of how well the Fed’s statement was received last night that the FTSE, climbing around 1%, has managed to cross 6900 for the first time in a fortnight despite the pound seeing its own 0.5% increase against the dollar. Since the Brexit result nearly 3 months ago there has tended to be a split between the index and the currency; not so today, with both basking in the central bank’s decision not to act yesterday evening.

The Eurozone indices were even more rambunctious than their UK peer this Thursday; the DAX and CAC both surged by 1.8% as lunch time approached, with each hitting 10 day highs in the process. What is interesting about the sustained gains seen in Europe is that it has come despite a pair of gloomy updates from the Bank of England and the ECB. The former warned in its latest PFC statement that Britain sit faces a ‘challenging period’ post-Brexit despite the generally positive data of the last few weeks, while the latter used its Economic Bulletin to reaffirm that Britain’s exit from the EU and the Chinese slowdown continue to pose a threat to the Eurozone’s recovery.

Looking ahead to the US open and the Dow Jones currently isn’t quite as enthused as the European indices, with the futures suggesting a 0.4% rise after the bell. That does, however, still leave the Dow above 18350 for the first time since it got a case of the rate hike fearing-jitters on September 9th. Data-wise there is nothing this afternoon that could really distract from the Fed dominance, with the usual Thursday jobless claims (expected effectively unchanged at 261k) joined by the existing home sales reading (forecast at 5.45 million against 5.39 million last month).

Please note this article does not constitute investment advice. Investors are encouraged to do their own research beforehand or consult a professional advisor.

Connor Campbell

Connor Campbell

Connor joined Spreadex in 2014 as part of a newly expanded financial analyst team after graduating from the University of Southampton with an MA in English. His focus is on providing Spreadex's customers with up-to-date and informative news, and is responsible for the market analysis found on the Spreadex website.

Connor produces three daily market updates, a daily stock earnings preview, a weekly financial market preview piece every Friday, a round-up of all the big financial stories making the weekend press every Monday morning and regular stock market features.

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