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FTSE Bounces; EasyJet Flies Into Top Spot

By City Index (Fiona Cincotta)Market OverviewJan 23, 2018 09:58
FTSE Bounces; EasyJet Flies Into Top Spot
By City Index (Fiona Cincotta)   |  Jan 23, 2018 09:58
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FTSE Bounces After US Highs As US Shut Down Ends

As was broadly expected, the FTSE bounced on the open this morning, following a record session in the US overnight. The Dow surged over 140 points, whilst the S&P and the Nasdaq tagged on 0.8% and 1% respectively, all hitting uncharted territory. The rally took place after the Democrats and the Republicans passed the funding bill to end the US government shut down, 72 hours after it started.

US earning season back under the spotlight

Whilst the US government shutdown was never expected to last any significant amount of time, the passing of the stop gap spending bill allowed investors to return their focus back to earning season, which is now well under way. Today we see earnings from Verizon (NYSE:VZ), Procter & Gamble (NYSE:PG), and Johnson & Johnson (NYSE:JNJ), with big names Ford (NYSE:F) and Caterpillar (NYSE:CAT) still to come later in the week.

EasyJet flies into top spot

Sticking with earnings, in UK corporate news, easyJet (LON:EZJ) flew into the top spot on the FTSE leader board. The low-cost carrier impressed with its results, jumping over 5% in early trading. Revenue increase at EasyJet comfortably hit double digits for the first quarter, up 14% to £1.14 billion. Meanwhile an industry indicator for revenue per seat increased a solid 6.6%, as easyJet continues to capitalise on its rival’s woes. The budget airline industry has been a tough place to be in recent quarters as evidenced by the demise of rivals Monarch and Air Berlin, however easyJet shares have shot up 15% in the past 3 months as market conditions are set to improve.

Eurozone sentiment in focus

Over in Europe, sentiment indicators are could give the flagging euro a boost, with ZEW sentiment surveys due from Germany and the eurozone, in addition to eurozone consumer confidence later in the day. The EUR/USD is trading down 0.2% heading into the reading, with the recent rally looking exhausted, despite the IMF saying that it expects eurozone economic growth to be 0.3% higher than originally forecast, increasing 2.1% in 2018 and 2% in 2019.

Sentiment is expected to be strong in the eurozone, a surprise on the upside could offer support to the EUR/USD although with the ECB monetary policy meeting in just two days, traders will remain cautious. Resistance is expected to be encountered at $1.2275 prior to $1.23. Meanwhile, immediate support for the pair can be seen at $1.22 with a stronger support in the region of $1.2165.

Disclaimer: The information and opinions in this report are for general information use only and are not intended as an offer or solicitation with respect to the purchase or sale of any currency or CFD contract. All opinions and information contained in this report are subject to change without notice. This report has been prepared without regard to the specific investment objectives, financial situation and needs of any particular recipient.

Any references to historical price movements or levels is informational based on our analysis and we do not represent or warrant that any such movements or levels are likely to reoccur in the future. While the information contained herein was obtained from sources believed to be reliable, the author does not guarantee its accuracy or completeness, nor does the author assume any liability for any direct, indirect or consequential loss that may result from the reliance by any person upon any such information or opinions.

Original post

FTSE Bounces; EasyJet Flies Into Top Spot

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FTSE Bounces; EasyJet Flies Into Top Spot

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