The pound continued to romp higher this Wednesday, as investors indulged in a hawkish view of the morning’s UK Q3 GDP reading.
Despite a better than expected pair of durable goods orders figures from the US – the core reading rose to 0.7%, while the non-core number hit 2.2% – cable widened its gains as the day went on. Sterling took 0.8% off the dollar, sending the pound to an 8 day, $1.325-tickling high; against the euro, meanwhile, the currency climbing a steady 0.6%, allowing it to squat just above €1.12.
All this put the FTSE in a miserable mood, with the UK index dropping 50 points to fall to its lowest price in nearly 3 weeks. With the likelihood of a November rate hike from the BoE only increasing following the (slightly) better than forecast third quarter growth reading – leaving sterling in line for another boost – the UK index may struggle to muster the momentum required to climb back, and stay, above 7500 in the coming weeks.
Elsewhere the Dow Jones fell from its record highs after the bell, dipping 0.2% to slip under 23400. The index is lacking the kind of propulsive gains managed by Caterpillar (NYSE:CAT) and 3M (NYSE:MMM) on Tuesday, forcing it to settle for a rare weak open.
As for the eurozone indices, despite the euro’s battering at the hands of the pound the region’s indices were pretty lethargic this afternoon. The DAX slipped below 13000 with a 30 point fall, while the CAC and IBEX dipped by 0.2% and 0.3% respectively.
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