Unable to justify another day of gains, the European markets moved sideways after the bell, at most eking out a smidge of growth here or there.
Helping to keep the indices on the right side of the green/red divide were Trump’s latest attempts to bully the Federal Reserve into another rate cut. The President decried the ‘horrible lack of vision by Jay Powell’ and his colleagues while calling for ‘at least’ a 100 basis point decrease in interest rates over the coming months.
Wednesday’s meeting minutes and the Jackson Hole Symposium, starting on Thursday, may give investors an idea as to how receptive the Fed is to Trump’s hectoring.
As mentioned, this hardly recreated yesterday’s stimulus-optimism, but rather allowed the European indices to protect their recent gains. The DAX was unchanged at a near week-peak of 11700, while the CAC scraped together a 0.1% rise as it teased 5370.
More robust was the FTSE, which added 0.3% to give itself a bit of breathing room above 7200. The main reason for this, however, seemed more to do with the pound than any central bank speculation. Sterling fell 0.4% against the dollar, taking cable back under $1.209, and 0.3% against the euro, leaving it at €1.091, as it expressed its lack of confidence in Boris Johnson’s ability to get the EU to budge on the issue of the Irish backstop.
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