A positive open from the US helped ease the situation in Europe this Friday afternoon.
The Dow Jones jumped 100 points after the bell, lifting the index back above 25050 in the process. Those gains were in part thanks to a pair of strong flash manufacturing and services PMI, both of which came in at 55.9.
The biggest event of the day – US or otherwise – is arguably still to come: the release of January’s Federal Reserve meeting minutes. Given that the market-wide panic that defined the start of February was based on a fear of rising interest rates, how things go in the second half of the week may be dependent on just how hawkish the Fed felt in their latest get-together.
The looming FOMC meeting minutes likely explains why the forex markets have suddenly become so quiet. The pound, euro and dollar have all settled into an eerie flatness, choosing to ignore Wednesday’s UK jobs report and Eurozone PMIs to focus on what this evening’s Fed releases.
This meant the European indices were allowed some room to breathe as the day went on. The DAX reduced its losses from 0.9% to 0.6%, while the CAC recovered from a half a percent decline to sit effectively flat just below 5290.
The FTSE went one better, shifting from a 20 point loss to a similar-sized rise, taking the UK index back above 7260 as it benefited from the positive earnings updates from Glencore (LON:GLEN), Lloyds (LON:LLOY) and Barratt Developments (LON:BDEV). It’ll face a greater challenge on that front tomorrow, however, with the likes of Anglo American (LON:AAL), BAE Systems (LON:BAES), Barclays (LON:BARC), British American Tobacco (LON:BATS), Centrica (LON:CNA) and RSA Insurance (LON:RSA) all reporting.
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