The European rebound really gathered pace on Monday, with investors seemingly choosing to focus on the positives, especially in regard to the Eurozone.
While news that Angela Merkel will not stand for re-election as chair of the CDU party in December – she is, however, holding onto the job as Chancellor – could have caused the fragile markets to spiral, the Eurozone instead led to charge higher as Monday progressed. Celebrating the fact S&P left Italy’s credit rating unchanged despite warnings of a recession and banking crisis elsewhere, the FTSE MIB surged 2.8%, a rise that allowed the CAC and DAX to up their own gains to 1% and 2% respectively.
The FTSE, still waiting for this afternoon’s final pre-Brexit Budget, was keen to join in, with the UK index climbing 1.7% to hit 7060. Not bad given at one point last Friday it was trading at 6850. As for the pound, it was far, far more tentative in its growth, nudging up by 0.1% against both the dollar and the euro.
Importantly the Dow Jones also seems prepared to party when the bell rings on Wall Street, with the futures pointing to a 250 point jump from the US Index. That would push the Dow back above 24900 – still 1800 points adrift from where it started the month, but better than the alternative.
"Disclaimer: Spreadex provides an execution only service and the comments above do not constitute (or should not be construed as constituting) investment advice or recommendations, or a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. Any person placing trades based on their interpretations of the above comments does so entirely at their own risk. Spreadex Ltd is a financial and sports spread betting and sports fixed odds betting firm, which specialises in the personal service and credit area. Founded in 1999, Spreadex is recognised as one of the longest established spread betting firms in the industry with a strong reputation for its high level of customer service and account management.
In relation to spread betting, Spreadex Ltd is authorised and regulated by the Financial Conduct Authority. Spread betting carries a high level of risk to your capital and can result in losses larger than your initial stake/deposit. It may not be suitable for everyone, so please ensure you fully understand the risks involved."