Spreadex Market Update

Exceedingly quiet start for FTSE et al. as investors try and ignore covid-19 headlines



It was another quiet start on Tuesday – though as we saw on Monday, that doesn’t mean the markets won’t end the session deep in the red.

Despite Brent Crude resuming last week’s gains – the black stuff is now tickling $56 per barrel following a 0.8% rise, with BP and Shell up 0.4% and 1% respectively – the FTSE took a tumble after the bell.

Dropping 0.3%, the index is back below 6,800, its energy sapped by the continued speculation that even tighter lockdown restrictions might be on their way in the UK, and Rishi Sunak’s warning that the economy is going to ‘get worse before it gets better’.

The pound likely helped tip the FTSE into the red, even if it only rose 0.2% against the dollar and euro alike.

The DAX and CAC were pretty sleep after the bell. The former nudged 0.1% higher, while the latter stayed in bed for the early part of trading.

Looking ahead to this afternoon and, after trimming its losses to the extent that it closed above 31,000 last night, the Dow Jones is expected to add 40 or so points, leading it back towards 31,050.

At present it seems investors are getting over their hesitations regarding the political situation stateside; that might change, however, if the impeachment process – sorry, the 2nd impeachment process – against Donald Trump really starts to heat up. Not because of what it means for the government or Trump himself, but rather what reactions it could provoke from his supporters.

As for the direction of the markets for the rest of the day, whether they can withstand another round of losses is going to be determined by how well they can keep ignoring coronavirus headlines, including news of a lockdown in the Chinese city of Langfang.

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