The FTSE is flat this morning in early trading following US equities fall yesterday as investors show concerns about the US Senate delaying it’s proposed US corporate tax cut.
Spreadex analyst, Connor Campbell noted “The FTSE has struggled in the last couple of days, with a volatile commodity sector and a flagging set of retail stocks dragging the UK index back below 7500.”
“We’ll see whether the latest manufacturing and industrial production figures can make anything better a bit later. The former is forecast to fall from 0.4% to 0.3% month-on-month, while the latter is expected to nudge higher, from 0.2% to 0.3%. There’s also the goods trade balance reading, with analysts estimating the deficit to have shrunk from £14.2 billion in August to £12.9 billion September.”
It’s the delay in Trump’s tax reforms that is driving sentiment in the US, and in turn globally. “USD is closing the week on a weak note following reports that the Senate plan would delay implementation of tax cuts until 2019.” commented FxPro analyst, Edward Anderson. “Details of the tax reform proposals has been the driving force behind USD in recent days.”
That sentiment was echoed with US equities which closed lower yesterday, “retreating from record highs as concerns that the Republican Tax reform could be delayed weighed on wider sentiment.” noted Accendo Markets analyst, Mike van Dulken.
“The Dow Jones shed 100 points, at one point trading as much as 250 points lower, as losses for McDonald’s, Caterpillar and United Tech dragged the index lower. The S&P 500, meanwhile, saw Industrials weigh while the Tech-focused Nasdaq underperformed.”