The information on this page does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. IG Bank S.A. accepts no responsibility for any use that may be made of these comments and for any consequences that result. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. Any research provided does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it and as such is considered to be a marketing communication.
Tuesday's important inflation figures have failed to stifle the index's enthusiasm, as it has vaulted above the 6700 level with barely a moment’s hesitation. It is not often that Europe struggles to keep pace with the bullish moves of UK traders, but today looks to be that exception to the rule.
Strong UK retail and property markets
The recovering UK retail market has helped Hammerson, the owner of numerous shopping retail centres, post some good figures. Also adding to the rosy picture is the 5.7% increase in property values, as the buoyant UK property markets have again driven prices higher. This feel-good factor has also rubbed off on British Land and Land Securities, with these companies making up three of the FTSE’s five biggest climbers.
Royal Mail and unions are once again sitting round a table with the aim of creating a company charter which should ensure fewer disruptions.
RSA Insurance has continued to trim the fat as it hunts for buyers for some of its Canadian exposure, with the aim of raising £200 million.
The UK IPO scene looks to maintain its stream of newly-quoted companies, as both Poundland and Pets at Home eye up quotes in the FTSE.
Presidents' Day means quiet day for US
Today is a quiet day for the US; with equity markets closed for Presidents' Day, none of the major corporations are reporting data. Although currency traders will have drawn the short straw with their markets remaining open, it is likely we will see considerably thinner volumes than on an ordinary day. Revived after their long weekend we will no doubt see equity traders back in numbers tomorrow, especially with Coca Cola reporting fourth-quarter figures.
Gold and silver reach for stars
Gold has again had a strong trading day and, much like Icarus, you do question how much higher it can go before things start to fall apart. A 12% rally since the closing days of 2013 will no doubt only increase the temptation for traders to take some profits off the table.
The trading patterns of gold and silver are often very similar; however, gold’s squeeze higher has been even more strongly replicated in silver with almost 10% being added in the last two weeks, never mind the last two months.
Currencies await inflation data
Although a quiet day, currency traders will be conscious of the UK inflation figures due out tomorrow and their potential to alter the direction that GBP/USD has been heading in for the last 12 months. The current heady heights have not been seen since May 2011.
The latest Eurogroup meeting has brought with it comments from European politicians, and this morning it was the turn of Jeron Dijsselbloem who voiced his thoughts that the euro is 'too strong'. As much as that might be the case, however, the currency markets have done nothing to rectify things so far today.