US equity markets enjoyed their best day of 2017 yesterday as investors reacted favourably to Trump’s most presidential of speeches so far, fuelled further by rising expectations of a mid-month US rate hike.
Accendo Markets Analyst, Mike Van Dulken commented – “The Dow Jones emphatically resumed its uptrend with gusto smashing through 21,000 led by AmEx and JPMorgan, only two stocks closing in the red, while the S&P 500 and Nasdaq both gained 1.4% with financials fuelling the run north.”
Things have dramatically quietened down this morning, investors exhausted from yesterday’s record-breaking run. Nearly everything was effectively flat after the bell, a sense of ‘what now?’ hanging over the market. The FTSE crept 5ish points higher, pushing it closer to the 7400 mark it couldn’t quite break before the end of the session on Wednesday.
As for the pound, it remains trapped at its current sub-1.23, 6 week low against the dollar while taking a measly 0.1% back off the euro. Construction PMI due out this morning is expected to remain unchanged at 52.2. A slowdown like that seen yesterday with the Manufacturing PMI could see the pound drop back into the red.
Like in the UK, the Eurozone wasn’t quite sure what to do this Thursday; the DAX, which is now back above 12000, barely budged, while the CAC couldn’t make any more headway on reaching 5000. There may be some more movement once the region’s inflation readings are released later in the morning. The headline CPI figure is set to come in at 1.8% for the second month in a row, while the core reading will be similarly unchanged at 0.9%.
Spreadex Analyst, Connor Campbell suggested – “Divergence from these estimates could be big news for the euro. Anything higher than what is expected will put more pressure on Mario Draghi and co. to consider tightening monetary policy during next week’s ECB meeting, and may help lift the currency away from its current lows against the dollar. If those figures shrink, on the other hand, the euro’s early losses could intensify.”
This afternoon provides us with the long awaited Snap IPO on the NYSE. In the rumour mill since late 2016, today marks the day the so-called camera company finally becomes the largest tech IPO since Alibaba in 2014. With shares priced at $17 amid reports of oversubscription, we’ll be watching closely to see if investors continue their interest in snapping up shares once Wall Street opens.