The FTSE has started the new month promisingly, as recent pieces of better-than-expected data have put some fire back into markets.
Miners have been boosted by news that China’s official purchasing managers’ index rose to 51.7 in August, up 0.5 points from July. The news benefited the FTSE’s mining sector in particular, with Fresnillo up 3.67% and Xtrata and Kazakhmys both adding 1.90% to their share price.
While we have seen a broadly decent start for equities, investors are certainly not leaping headlong into risk assets – to put the morning’s gains into context, we are still well below the 5300 resistance level. Recent data from the US and China has not been spectacular, it has simply not been damningly disappointing. While this is in itself an improvement on the range of soft numbers that have been keeping share prices on both sides of the Atlantic firmly under the cosh, it is unlikely to spark any significant rally on its own. That said, the month has started well and has certainly set the tone for possible further gains – but only if they can be underpinned by decent numbers.
You might also be interested in: