Spreadex Market Update

European gains start to wane, FTSE drifts back below 7700



Things became a bit more mixed as the day went on, with investors still hesitant to whole-heartedly pour back into the markets.

Though the FTSE MIB is certainly benefiting from the signs of positive progress in regards to the Italian political situation, with the index surging more than 0.6%, the rest of the Eurozone wasn’t quite as enthusiastic. The CAC could only add a few points in value, while the DAX actually fell half a percent, dragging it away from its near 12800 intraday peak.

As for the euro, the single currency failed to get much of a boost from the Eurozone inflation figures. May’s overall flash estimate came in higher than expected, and oil-boosted, 1.9% against the 1.2% seen in April; strip out the surge in the price of the black stuff and the core reading also rose faster than forecast, hitting 1.1% for the first time since last August. Yet that core figure is still way off the 2% target set by the ECB, perhaps explaining why the euro slowed slightly as Thursday progressed, up 0.2% against the dollar while slipping 0.1% against the pound.

The FTSE, still on a leash led by Eurozone sentiment, saw its gains start to erode as lunchtime approached, causing the index to drift back below 7700. Its general lack of oomph isn’t being helped by Brent Crude falling below $77.50 per barrel, a decline that has sent BP and Shell into the red.

Turning to the afternoon and the Dow Jones’ own rebound is set to stall when the bell rings on Wall Street. Having risen past 24600 with a 1.25-plus climb, the Dow is facing a 30 point dip, despite the meeting between secretary of state Mike Pompeo and top North Korean official Kim Yong-chol.

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