Setting aside the trade war tensions between the US and EU, for now anyway, the European indices got off to a strong start on Friday as the Italian political crisis appeared to come to an end.
Though not exactly the ideal government in the eyes of the markets, with a combination of ministers from the anti-establishment Five State Movement and the right-wing League, the formation of any Italian government is something to celebrate given how pronounced fears were that the situation would result in a Eurosceptic snap election. The FTSE MIB, obviously, was the most relieved, rocketing 2.8% higher, with sturdy 0.6% and 0.9% growth from the DAX and CAC respectively.
The euro wasn’t quite as enthused, its joy tempered by the brewing transatlantic trade issues, the nature of the Italian government and the fact today could see Spanish PM Mariano Rajoy receive a vote of no confidence. This meant the single currency only managed a 0.1% rise against both the dollar and the pound, crossing $1.17 against the former and £0.88 against the latter.
As for the FTSE, it jumped half a percent after the bell, re-crossing 7700 in the process. The UK index finally has something local to deal with this Friday, in the form of May’s manufacturing PMI, which is forecast to fall from 53.9 to 53.5 month-on-month.
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