Approaching the close, the London index is nudging its way higher.
It’s been a far from convincing session for the London index today with traders unwilling to commit to further gains despite a resurgence in M&A chatter. Tomorrow’s non-farm payrolls are without doubt serving to rein in the upside, despite the fall in weekly jobless claims, and although lacklustre data from the UK housing market will add to pressure to keep interest rates in check, the prospect of poor cash yields alone won’t drive more buyers of equities. The impending long weekend in the US is also likely to be leading to a number of traders sitting on their hands in the near term, although on the flipside it’s worth pointing out that the fact that we haven’t seen a flood of opportunistic
profit-taking after yesterday’s big move higher again shows a degree of confidence.
Eurozone retail sales figures may also have the potential to add some fresh direction early in tomorrow’s session, but apart from that it’s going to be all eyes on the labour situation across the Atlantic. Earnings news is set to be thin on the ground and the risk that Wednesday’s gains could yet be eroded cannot be discounted either. Markets may seem unusually calm given the steady return to work after the summer break but these conditions cannot be expected to last long.
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