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Less than half a dozen blue chips are trading in the red, with no notable fallers. On the upside Rolls-Royce (+6%) has powered to the top spot, having promised shareholders a billion pounds in buybacks, after it sold its gas turbine unit to Siemens earlier in the year. Perhaps unusually for current climes, the jet engine maker has stated that it plans no acquisitions, with discretion the better part of valour after suffering recent order cancellations. The shares have returned to the top of their recent range, but are still well short of the £12 level where they were before the fraud investigation was announced in February.
The Fed’s reaction to recent inflation data as 'noise' created a nice echo for equity bulls, with US indices pushing back towards their early June all-time highs and the VIX printing a low close not seen since February 2007. Confirmation of tapering remaining on track for an October end helped bid up cable, and this morning you can get a little more than $1.70 for a pound. FX markets are positioned for, and certainly talking up, a continued upward move here. A weaker May for UK retail sales created little reaction, and until we get a close above $1.70 (as highlighted by Stan this morning) longs will remain hopeful of getting one last chance to add to their positions with a $1.69 handle.
US markets are nicely positioned for a swing at their all-time highs, with the opening call for the Dow Jones at 16,900, down 5 points, and, with little more than weekly jobless claims on the economic agenda, a piece-by-piece dissection of Amazon.com’s first foray into the smartphone market may be the most talked about item of the day.