Compared to the recent drama the market has been treated (or should that be subjected) to this Monday has been rather tame.
With the pound managing a mild 0.2% loss against both the dollar and the euro (leaving it under 1.22 and 1.11 respectively) the market’s main source of movement was absent this morning. This in turn proved to be a drag on the FTSE, which fell more than 50 points as the day continued, taking it back towards 6950. The UK index was also likely impacted by the continued political uncertainty post-Brexit, with reports this morning suggesting that Phillip Hammond faces a battle with those MPs looking for strict curbs to migration.
Pearson continued to lead the FTSE 100’s losers at the start of the week. The former FT-owner (which also sold its 50% stake in The Economist and slashed 4000 jobs earlier in the year) dropped 11% as it revealed a 7% slide in underlying sales for the first 9 months of 2016, with investors uninterested in news of a potentially pound-boosted set of full year earnings. It’s worrying that the company has failed to find a more stable sales base in its education division given that it is now almost solely reliant on that sector after offloading of its major media outlets.
Looking to the US open and the Dow Jones seems fairly uninterested this Monday, with the futures suggesting a 40 point fall after the bell. There is a string of B-tier data for the US index to deal with this afternoon; the Empire State manufacturing index is set to bounce back to 1.1 from -2.0, while the capacity utilization rate is expected to edge up 0.1% to 75.6% and the industrial production reading is forecast to climb back to 0.3% from -0.4% last month.