The FTSE can't make up its mind
Fiona Cincotta June 4, 2020 10:21 AM
The FTSE can’t quite decide on a clear direction this morning despite the stronger close in the US yesterday and an overnight rally in Asian stocks.
The FTSE can’t make up its mind
The FTSE can’t quite decide on a clear direction this morning despite the stronger close in the US yesterday and an overnight rally in Asian stocks.
European investors are holding back ahead of the European Central Bank’s decision later today when President Christine Lagarde is expected to sign off on an expansion of the bank’s €750bn emergency programme which ends in October. A closer look at how the current financial injection is being used shows that a large proportion was channeled into Italian bonds, with smaller proportions into Spanish and German paper.
Airline, travel and property stocks edge higher
The gradual reopening across Europe and the pickup in the number of international flights is helping lift airline stocks. A mix of property, retail and travel companies is also edging higher.
But the rallies are balanced out by a decline in water utility Pennon Group which came under pressure after it released its full year results. This morning’s decline comes as investors are taking profits off the table, having heavily bid up the company in the run-up to the earnings release, which revealed that the company has good liquidity and is on course to pay out its planned dividend for this year.
Brent crude pauses below $40
Having pushed Brent crude prices higher for most of this week investors are pausing for breath possibly before a second attack of the $40 mark. Earlier this week bids were coming in thick and fast over speculation that OPEC and Russia will agree to extend and possibly deepen production cuts at OPEC’s meeting next week. Looking at prices now, it is clear that Brent struggles to trade above $40, at least while the recovery in transport and air travel is as slow as it is.
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