Beyond the Fed-fretting that inhibited – or actively hurt – the rest of the markets, the FTSE had a very specific headache on Wednesday.
In a rare sight sterling was feeling pretty full of itself, the currency benefiting from a few different market forces. Both the dollar and euro were hurt by the dovish noise either made (the ECB) or about to be made (the Fed) by their respective central banks. Add onto that a better feeling about the Tory leadership battle – why? Who knows – and the pound had its best day in a while, rising 0.6% against the greenback and 0.4% against its single currency rival.
If that wasn’t enough, the UK mining sector was in a bit of a state. Rio Tinto (LON:RIO) dropped nearly 4.5% as it cut its 2019 guidance for iron ore shipments from Pilbara in Australia, and the industry giant took its peers with it. BHP Group was down 2%, while Anglo American (LON:AAL) fell 2.3% and Antofagasta (LON:ANTO) slipped 1.7%.
All this meant the FTSE gave back 50 points as Wednesday went on, slumping back towards 7400. The DAX was also in a bit of a mood, the index loitering at 12300 after dropping 0.4%. In contrast the Dow Jones was pretty chill, teasing 26500 as it awaited the Fed’s latest statement this evening.
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