European markets have progressed from a mixed open to broadly positive in early trading on Friday, helped by a small recovery in the price of oil and taking heart from weekly gains registered across major stock indices in Asia.
Having stalled on Thursday after large gains the previous four days in the context of what has been a very weak market, investors in the FTSE 100 are naturally a little nervous that we’re on the cusp of another panicked sell-off.
A pullback from current levels in UK stocks is a distinct possibility, especially with considerable uncertainty surrounding PM David Cameron’s apparent efforts to defend the interests of the City of London during Brexit negotiations.
UK retail sales rose by 2.3% m/m in January, massively exceeding expectations of a 0.8% after a -1.0% drop in December. Sterling traders, however, were not impressed with the British currency unmoved. The pound is likely to remain depressed until there is some movement in Brexit negotiations - for the good or the bad.
There were no real sectoral leaders on Thursday, with financials, healthcare and technology shifting around atop the leader board. Basic resource stocks are acting as the biggest drag, largely tracking the price of oil. Still, the basic resource sector looks set to finish the week higher, with Anglo American (L:AAL) close to having avoided a weekly drop for the past four weeks.
Coca Cola HBC AG (L:CCH) was top of the UK benchmark after reporting better than expected full-year results.
US markets are expected to open higher with even the Nasdaq looking to open in positive fashion after a 1% decline yesterday, ahead of the release of January inflation data.
USA pre-opening levels
S&P 500: 5 points higher at 1,921
Dow Jones: 20 points higher at 16,433
Nasdaq 100: 7 points higher at 4,158