A very strong UK jobs report gave a Brexit-bored pound a boost on Tuesday, transforming the FTSE’s session in the process.
Wage growth, including bonuses, hit 3.4% between September and November; that’s the best reading in a decade, and way up on the 2.5% growth posted for the same period this time last year. On top of that, the unemployment rate dropped back to 4.0%, with employment at an all-time high of 75.8%.
That gave the previously lethargic sterling a reason to smile. Cable crept above $1.29 as it rose 0.2%, while against the euro the pound crossed €1.1365 after climbing the same amount. Those gains were capped by the ongoing Brexit brouhaha, the latest development being a warning from Stephen Barclay that the EU may not agree to an extension of Article 50 as some factions are hoping.
Still, the pound’s gains were enough to upset the FTSE. Well that, and Brent Crude’s widening losses, the black stuff tumbling 2% thanks to the concerns surrounding the Chinese economy. With BP (LON:BP) and Shell (LON:RDSa) dropping 1.5% and 2.1% respectively, and its miners posting similar falls, the FTSE shed half a percent, forcing the UK index back towards 6900.
Looking ahead to the US open and, after missing out on the Chinese data reaction on Monday, the Dow Jones is set to drop 100 points when the bell rings on Wall Street, a relatively minor decline that keeps it near last week’s one month-plus highs.
Disclaimer: Spreadex provides an execution only service and the comments above do not constitute (or should not be construed as constituting) investment advice or recommendations, or a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. Any person placing trades based on their interpretations of the above comments does so entirely at their own risk. Spreadex Ltd is a financial and sports spread betting and sports fixed odds betting firm, which specialises in the personal service and credit area. Founded in 1999, Spreadex is recognised as one of the longest established spread betting firms in the industry with a strong reputation for its high level of customer service and account management.
In relation to spread betting, Spreadex Ltd is authorised and regulated by the Financial Conduct Authority. Spread betting carries a high level of risk to your capital and can result in losses larger than your initial stake/deposit. It may not be suitable for everyone, so please ensure you fully understand the risks involved.