FTSE treads water as anti-hard Brexit bill moves through Parliament
Fiona Cincotta September 6, 2019 4:20 AM
The FTSE opened marginally down this morning, led by miners like Fresnillo and Antofagasta.
The FTSE opened marginally down this morning, led by miners like Fresnillo and Antofagasta. But there were no major swings in the index. It looks as if the stock market is taking a breather with few big names reporting until later next week. On the political front, the drama has died down as the Lords have debated the proposed legislation to block a hard Brexit. The Conservative party is still pushing for an election but the prime minister is unlikely to get his wish until Parliament can see a hard Brexit is off the table.
There was some more overnight selling in the GBP/USD market, with sterling dropping sharply from 1.2345 down to 1.2300 which is holding currently as a resistance level. Sterling is taking back some territory from main global currencies like EUR and JPY in what is something of a relief rally, but there will likely be further volatility next week once we hear more about the prospects of an election.
US rallies again on hopes of China trade deal, but recession lurks
The US market predictably rallied yesterday on news that the country is going back to the negotiating table with China, with the S&P 500 hitting a one month high. It was the biggest one day gain for the S&P in about three weeks. Concerns remain about those US bond yields and over the longer term.
Asian stocks were also in bullish mood, with gains in China and Japan. China in particular is mulling further stimulus measures. Hong Kong’s Hang Seng Index is also in positive mood after the territory’s government took its proposed extradition bill off the table. On the downside, the territory was also downgraded by Fitch.
Gold sells off slightly on back of optimism – too soon?
In the commodity markets gold has started to slide a little from $1519 to $1506, before rallying again after European markets opened. This can be put down to some short term optimism prompted by a number of the key political issues of the past few weeks looking like they are a step closer to resolution.
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