The European indices weren’t feeling quite as cocky as they were on Monday, while the pound got a bit of a boost from the EU’s Advocate General.
Having initially held off from posting any serious losses as Tuesday got underway, the FTSE became the worst performing major index as lunchtime approached, plunging 0.9% to duck back under 7020. This as its miners shed a large chunk of the post-G20, trade truce celebrating-growth they’d managed at the start of the week; BP (LON:BP) and Shell (LON:RDSa) also gave up their green, despite Brent Crude rising by 2.2%.
Of course the FTSE wasn’t helped by sterling’s own gains. It is worth noting, however, that while the ECJ Advocate General’s claims that the UK can cancel Brexit by unilaterally revoking Article 50 certainly gave the pound a lift, the fact the euro and yen posted similar gains against the dollar suggests that Tuesday’s growth is more weighted towards the greenback’s own issues than sterling strength. This is further bore out by the pound only adding 0.2% against the euro, compared to cable’s 0.7% climb.
Looking ahead to the US open and the Dow Jones is set to follow Europe lower. The futures have the index slipping 100 points after the bell, a move that would send the Dow back towards 25700, as investors consider the discrepancies between the American and Chinese accounts of the weekend’s meeting in Argentina.
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