With the will they, won’t they, can they, should they, debate still raging on over the FOMC’s interest rate, policy traders have found it difficult to gauge the correct direction from here onwards. Adding to the confusion has been US GDP figures, which have firmly muddied the water, as Q2 figures came in below expectations but Q1 numbers were revised higher.
As the session goes on it seems like dollar bulls are gaining ground, given that nothing in the statement last night explicitly rules out a September move.
After probably thinking that Lloyds’ quarterly figures on Friday were going to be his ‘banker’, George Osborne must be tempted to play the lottery this weekend following the surprisingly good news that RBS posted figures that were better than expected. Although it produced a profit it, it was nothing that would enable the bank to get back into the swing of paying out dividends, but at least the tide appears to have turned.
Shell’s announcement of aggressive cost-cutting measures has been welcomed by the City forcing the shares higher by 5%, going a long way to explain why London is doing so much better this afternoon.
Another of the oil industry feeling the pain of weaker oil prices was Glasgow-based Weir Group, which posted first-half figures that were down by 40%. At face value a sell-off may have been the appropriate reaction, but given the heavy losses we have seen it appears that the downside move has been exhausted for now.
The last two days have seen Twitter and then Facebook do their best to punish social media investors, and tonight it is the turn of LinkedIn. Possibly sensing that the writing is already on the wall, traders have sent the shares tumbling by almost 4% in the first couple of hours of trading.