By Connor Campbell, Financial Analyst, Spreadex
Befitting a relatively sparse economic calendar – at least compared to what’s in store on Thursday and Friday – the markets got off to a subdued start this Wednesday.
After surfing past 7400 on a board made from BP (LON:BP) and Rolls-Royce (LON:RR) investors, the FTSE looked a bit puffed out as the day got underway, the index slinking back by around 20 points. A retreat from the commodity stocks – informed by both Brent Crude’s 0.7% slide and a 2% fall from Rio Tinto (LON:RIO) despite the miner announcing a £1.9 billion share buyback – helped keep the FTSE under the cosh. It did receive some support from BAE Systems (LON:BAES), however, the arms dealer climbing 3% after besting first half earnings forecasts.
As for the pound, it managed to hold above 1.32 against the dollar with a 0.1% rise, but wasn’t so lucky against the euro, dipping 0.2% to give up most of whatever meagre rebound it managed yesterday (sterling is seriously struggling against its continental cousin). Wednesday’s spotlight is on the latest construction PMI, forecast to fall from 54.8 to 54.3 month-on-month; if it can outperform expectations like its manufacturing peer did on Tuesday then the pound may get a boost.
There wasn’t a lot going on for the eurozone this morning, allowing the euro to continue its summer surge. This in turn was bad news for the DAX and CAC, the German and French indices falling 0.1% and 0.4% respectively.
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