The FTSE 100 is fairly flat in early trading following another round of record closing highs on Wall Street, followed by a mixed session in Asia overnight.
It’s been a tough start to October for the Pound with Monday’s Manufacturing PMI disappointing and Tuesday’s Construction PMI failing to meet analyst expectations with an unexpected 48.1 reading. Today is the turn of arguably the most important reading of the three – Services PMI.
Spreadex analyst, Connor Campbell suggested “Analysts are forecasting the services reading will nudge higher, ever so slightly, from 53.2 in August to 53.3 in September. The fear is that this estimate will be way off base, as was the case with the manufacturing and construction figures earlier in the week.”
A positive reading may help arrest the Pound’s October slide but figures that fall short of expectations are likely to cast further gloom on Sterling. With Equities again riding high, it is the FTSE that stands to gain from any fallout.
Meanwhile, the Euro is has found favour with investors this morning following its drop to 1.17 yesterday as the Dollar’s positive run continued.
ADS Securities analyst, Konstantinos Anthis commented “The single currency is currently trading with a positive bias as demand for the dollar weakens and there is a new expectation that the ECB’s will very soon be making an announcement on tapering.”
“The euro’s weakness in recent sessions has been caused by traders backing the dollar, which is being pumped up by bullish comments from the Fed. But, before they put more money on the table, dollar investors will want to see how the Non-Farm Payroll prints on Friday.”
Over in the US, equity markets once again closed at record highs, with all three major indices ending the yesterday’s session at record levels. Accendo Markets analyst, Mike van Dulken noted “The Dow Jones notched its fifth consecutive record closing high, its 44th of the year, as 3M, UnitedHealth and Home Depot contributed the most gains, offsetting drag from Boeing.”
“The S&P 500 and Nasdaq also finished at record closing highs, with Airlines outperforming on the former.”
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