Five days of gains for FTSE
It looks as if we will be five for five by the end of the session, with five days of gains behind us. What’s more, we’re now back to highs not seen since the beginning of March. With a three-day weekend looming in the UK, traders have opted not to push the market too far, so it looks to be a subdued end to the week. Bullish traders will feel very happy with their work, however, having taken the opportunity presented by pharma bid activity and great results from the banking sector to lift the index past its previous sticking point of 6700.
This momentum now needs to be sustained as we head towards the high water mark around 6866. As we go into the long weekend, most investors will be crossing their fingers and hoping that the Ukraine situation does not deteriorate, even as Russia seeks to call a meeting of the UN Security Council. Today’s late bout of selling towards the closing bell is an indication that the market is still nervous trading at these levels.
NFP number impresses
The Dow Jones has touched 16,600 again today, but US markets are showing a similar pattern as the UK and are evidently not keen on holding positions into the weekend. Rumours of activity in the Ukraine saw gains evaporate, setting the stage for a dismal finish for the week. The headline NFP number was another impressive gain, and the atrocious GDP reading has been banished from traders’ minds, as everyone focuses on the extremely positive headline number, with a drop in unemployment to 6.3% adding to the generally positive feeling. There are still problems beneath the surface, given the shrinkage in the labour force as well, which perhaps explains why markets haven’t exactly exploded with excitement, since it shows that it’s not entirely about job creation and that Americans continue to leave the labour force in droves. This is yet not an economy that is firing on all cylinders.
Ukraine activity boosts gold and silver
Gold and silver shot higher in a volatile afternoon session, spooked by reports of military activity in the Ukraine. This is a situation that refuses to go away, and the regular escape to the old physical metals shows that it still has the power to cause emergency flights to safety.
Currency pairs experience volatile afternoon
Late stage volatility caused plenty of excitement in the FX sphere too, with currency pairs dropping rapidly across the board before springing back again. For EUR/USD, services PMIs from various eurozone countries will be of major importance next week, but every step higher for the euro brings with it increased risk of jawboning from the European Central Bank.