While the rest of Europe wilted in the face of the USA’s latest tariffs on Chinese goods, the FTSE benefited from the continuation of sterling’s awful August.
With the threat of a ‘no-deal’ Brexit – something highlighted by both Mark Carney and Liam Fox in the past few days – at the forefront of investors’ minds the pound took another troublesome tumble. Having opened unchanged, cable slipped 0.4% as Wednesday went on, causing sterling to fall below $1.29 for the first time since the start of September 2017. Against the euro, meanwhile, the currency shed half a percent, hitting a 9 month nadir and causing trouble for anyone from the UK about to go on their summer holidays.
All this meant that the FTSE actually ended up jumping 0.6%, lifting above 7770 with 7800 in its sights. This was in contrast to the trade war-spooked, and euro-weary, DAX and CAC, with both the German and French indices falling 0.2%.
Turning to this afternoon and the Dow Jones looks undecided about which way to go, with the futures having the index open effectively flat just below 25650. Like on Tuesday, there’s isn’t a lot – well beyond, perhaps, the US crude oil inventories – to shift things in the US, though investors will be on high alert for any trade war news.
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