You wouldn’t think the FTSE had just been dealt the UK’s worst GDP reading on record, officially plunging the country back into a recession 11 years after the financial crisis.
The UK index outstripped its peers and then some on Wednesday, surging 2.2% to cross 6280. That’s the FTSE’s best price for over 3-weeks, and leaves it less than 100 points off a fresh 2-month peak.
There are a few reasons you could pluck for the FTSE’s success. The Q2 GDP reading was oh-so-slightly better than forecast. The UK economy actually grew by 8.7% in June (even if it remains way off pre-pandemic levels). Gains for Brent Crude left BP (LON:BP) and Shell (LON:RDSa) up 1.6% and 2.8% respectively, while a lack of further escalation between the US and China helped send HSBC 3.6% higher.
Vaccine chatter also provided an underlying cause for optimism. Though it was probably news the US has bought 100 million doses of Moderna’s potential covid-19 treatment for $1.5 billion, rather than the speculation over the safety or effectiveness of Russia’s reported vaccine.
Then there was the US open, with the Dow Jones adding 260 points to re-cross 27950. The Dow had lost all of its growth by the end of yesterday’s session, and needs another spurt higher if it is to close above 28000.
After a flat start the Eurozone indices also picked up as the session went on. The DAX climbed 1% to within whisker of 13100, while the CAC rose towards 5100 with a 1.2% increase.
"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."