It feels appropriate that this week should end with a Friday the 13th. Yet following the worst session since 1987 – and the FTSE’s 2nd worst performance ever – investors were willing to give a rebound another go.
Sweeping in a multi-year lows feels like a natural reaction to what went down on Thursday. Especially after the Federal Reserve attempted – if weren’t quite successful at – damage control by announcing a $1.5 trillion market-injection last night.
Driven by its miners – Rio Tinto (LON:RIO), BHP Group and Anglo American (LON:AAL) were all up between 9% and 12% – the FTSE climbed 100 points to just about cross 5450. That already marks a sharp pull back from the 6%-plus bounce seen in the moments after the open, suggesting that equities have a job on their hands convincing investors to stick with them until closing time. It’s probably also worth noting that, even with this rise, the UK index is has shed almost exactly 2000 points in the last 3-weeks.
The gains even less pronounced in the Eurozone. The DAX rose 0.6%, while the CAC reclaimed 1%, like the FTSE immediately losing their lustre as they struggled to take the edge off yesterday’s calamity.
Crucially at present the Dow Jones is forecasting its own 2.5% rebound when the bell rings on Wall Street, an increase that would push it back above 21700. How the Dow does later on will be key to the sustainability of this already shaky European rebound.
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