By Connor Campbell, Financial Analyst, Spreadex
There wasn’t a lot of good cheer out there this Wednesday afternoon, the US open helping to push the European indices further into the red.
Divergent manufacturing and services PMIs – the former unexpectedly fell to 52.5, while the latter surged to a 28 month high of 56.9 – did little for either the dollar or the Dow Jones. The Dow dropped 60 points as the bell rang on Wall Street, taking the index away from the 21900 mark it had recrossed at points last night and this morning. As for the greenback, though it rose 0.3% against the pound that was more due to sterling weakness than dollar strength; against the euro it plunged 0.6%, while against the yen it was down 0.4%.
Sterling’s dreadful showing – its 0.8% collapse against the euro pushing it ever closer to an 8 year low – meant the FTSE could stave off the chunkier losses seen elsewhere, instead dipping just 10 or so points. That’s impressive given that WPP (LON:WPP) dropped off a cliff this Wednesday, the advertising firm suffering a 12% dive after revising its full year forecasts lower for the second time since 2017 began.
The eurozone indices, meanwhile, shuddered in the face of the ever-strong euro, the DAX and CAC dropping 0.4% and 0.5% respectively. The currency has spent summer bullying sterling, haunting the pound with the spectre of parity; against the dollar it has traded a bit more laterally in recent weeks, though at $1.18 it isn’t too far away from the 2 and a half year high struck at the start of August.
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