A relatively uneventful Friday morning saw the pound turn its initial losses around, while the FTSE pulled back from its record peak-flirting highs.
It’s hard to see exactly what has prompted sterling, previously down 0.3% against the dollar and flat against the euro, to reverse its early decline. The likeliest reason is faint whiff of Brexit progress between the UK and EU at the Brussels summit, with Donald Tusk confirming that the latter would begin internal discussions about the ‘second phase’ of the Brexit negotiations, i.e. the all-important trade talks. While that isn’t exactly what Theresa May and David Davis would have wanted, it does leave December as the possible starting date for formal talks – a bit can-kicky, but better than nothing.
Elsewhere the European indices slowed down somewhat as the morning went on. The FTSE is now up 0.3%, leaving the UK index 30 points lower than the day’s highs, while the DAX and CAC have seen their gains roughly halve to 0.3% and 0.2% respectively.
Looking to the afternoon and the Dow Jones is set to rocket another 80 points higher when the bell rings on Wall Street, taking the US index to a fresh, 22350 record peak. The reason for the Dow’s latest growth seems to be last night’s Trump budget approval from the US Senate, a symbolic step on the road to the President’s much-touted, and market-pleasing, ‘massive tax cuts’.
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