With the Dow Jones getting its mojo back last night thanks to some strong earnings – the US index surged more than 500 points – the European markets managed a decent, if mixed, showing after the bell.
The FTSE, which lagged behind its peers on Tuesday thanks to the pound’s wage growth-aided rise, could only a handful of points after the bell. That left the UK index at 7060, off its 6 month lows but a way away from the 7500-plus levels is sat at as October opened. In comparison, the DAX and CAC were up 0.3% and 0.4% respectively, both hitting one week peaks.
The mildness of the FTSE’s growth came despite a sluggish start for sterling. The pound dipped 0.2% against the dollar, taking cable back under $1.317 having teased $1.324 on Tuesday, while against the euro it was unchanged at €1.139.
There’s good reason for the currency’s tentative open. Not only does the morning bring September’s UK inflation reading, expected to slip from 2.7% to 2.6% month-on-month, there is also the small matter of the Brexit-focused EU summit in Brussels. The weekend’s developments, namely surrounding the issue of the Irish border, have made the mood between May and her European Union counterparts decidedly frosty, with Donald Tusk claiming there was ‘no grounds for optimism’ that a deal can be struck on Wednesday. Any updates and comments as the day goes on could play a big role in how the pound performs.
Away from the macro-stuff, ASOS (LON:ASOS) was firmly back in fashion following its full year results. The AIM superstar, which has really struggled in 2018 market-wise, rocketed 14% higher after the bell as it posted a 26% rise in group revenue to £2.4 billion and, more importantly, a slightly better than forecast 28% jump in pre-tax profit to £102 million. And while the company didn’t alter its guidance for FY19 – a potential problem going forwards due to its slowing retail sales growth and hefty investment costs – the jump in profits was enough to bring some of its previously sceptical investors back on board.
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