The FTSE has opened flat this morning. With the Pound performing strongly against the Dollar, this is weighing on it’s multinational constituents. However, the weaker Dollar is benefiting the Oil and Mining sectors.
In FTSE corporate news “Babcock signals a good start to FY2018 with a stable order book and bid pipeline” and “Mike Ashley’s Sports Direct has bought a 25% stake in Game Digital while Premier Oil’s trading update suggests strong production ahead of guidance and lower costs.” noted Accendo Markets Analyst, Mike van Dulken.
“ASOS’ trading statement shows revenue growth at the upper end of forecasts. Telford Homes suggests further momentum in the build-to-rent sector, however it points to recent political / economic uncertainty and the wider housebuilders sector may react more to disappointing RICS house price data overnight.” he added.
The US dollar came under pressure yesterday following Fed Chair Janet Yellen’s comments during her testimony in Washington. ADS Securities Analyst, Konstantinos Anthis suggested “…she appeared less bullish than expected. Traders were surprised to hear Yellen refer to the uncertainty caused by the slow inflation growth in the US and took her comments as a signal that the next rate hike is still on the table but probably not until September.”
As a result of Yellen’s less Hawkish tone, US equity markets rallied to close higher across the board. “The Dow Jones, despite being the underperformer of major US bourses, closed at a fresh record high as DuPont led risers, while the S&P500 and Nasdaq both benefitted from continuing Tech sector strength to close 0.7% and 1.1% higher, respectively.” added Mike van Dulken.