FTSE Focuses On Jobs Positives Despite Unemployment Rate Hitting Post-2016 High

FTSE Focuses On Jobs Positives Despite Unemployment Rate Hitting Post-2016 High

Spreadex  | Jan 26, 2021 09:07

The European markets saw a post-slide rebound on Tuesday, after they had ended Monday in a state of disarray.

The FTSE 100’s gains are the most peculiar. Up 0.7%, the UK index chose to try and force a positive angle on a jobs report that saw redundancies at a record high, and the unemployment rate hit 5% for the first time since mid-2016.

Yet that rise in the unemployment rate still leaves it short of the 5.1% forecast. The average earnings index surged past estimates, at 3.6% against the 2.9% estimated. And, in the most recent piece of data, December’s claimant count change reading came in at just 7.0k, a fraction of both the 38.1k seen the month prior, and the 47.5k analysts had expected.

It helped the FTSE that the pound took the heat out of the negative elements of the report, falling 0.3% against the dollar and 0.2% versus the euro.

Even with that 0.7% increase, things aren’t looking good for the FTSE. Though it has a bit of room yet until it reaches the levels it opened the year at – it is hovering around 6,675, compared to the sub-6,500 price it started at on January 4th – it has almost erased all of the super-surge seen on the 6th.

Concerns over the length of the UK’s current lockdown remain an underlying issue for the index, especially since the Conservative party seem to have shifted their strategy away from the make-and-then-break promises policy of 2020.

The Eurozone indices were in a slightly better state than the FTSE. The DAX added 1%, though that left it 25 points shy of 13,800. The CAC, meanwhile, wheezed its way towards 5,500 with a 0.6% increase.

At the moment the US open may undermine the morning’s European growth. The futures have the Dow Jones heading for a 0.2% decline, leaving it a smidge above 30,900.

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