Dow Jones jumps towards 24800, sterling-scarred FTSE reluctant to join in with festivities
An explosive start from the Dow Jones lifted the spirits of the European indices, the US index seemingly coming out of the other side of its trade war-fearing funk.
The Dow surged 220 points after the bell rang on Wall Street, a move that took it to 24800 for the first time in nearly a month, i.e. before the end of March’s malaise. A lack of news, be it about a US-China trade war, or military action in Syria, or an escalation of aggression between the US and Russia, has helped the Dow get its swagger back, the index further boosted by a so-far strong season of earnings.
Ever-receptive to what’s going on in the US, the eurozone ignored some ropey ZEW economic sentiment readings to shoot higher. The CAC surged 1% to cross 5350, while the DAX really let rip, jumping 1.6% to tease a 7 week peak of 12600.
As for the FTSE, it couldn’t quite join in with the festivities. Though the UK index did manage to eke out a 0.3% rise that growth pales in comparison with what’s going on in the eurozone and US. The FTSE’s reticence likely stems from the return of its negative correlation with sterling. While the pound stalled following a slightly disappointing, but still promising, wage growth reading, it is only just off of its post-Brexit high against the dollar, and is actually knocking on the door of €1.16 against the data-weakened euro, itself a fresh 11 month peak.
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