In the post-Greek crisis world, it has been good to have a day of unexpected developments, namely UK retail sales and the sale of the FT. The pound’s steady progress higher, which has continued in expectation of higher UK interest rates in the near future, was rudely interrupted this morning, as data showed UK consumers did not empty their wallets as freely as hoped in June. The news does not really damage the expectation that UK rates will rise in due course, but it did cause increased selling of sterling, which will surely accelerate should further UK figures point to a derailing of the economy.
History was made today as Japanese group Nikkei bought the voice of the UK financial services industry, the FT. Nikkei had not been viewed as one of the primary contenders, but with sales in retreat in its home markets the group evidently decided a bold stroke was needed. For Pearson, whose shares rose over 2% following the news, it is the end of an era, but the sale will give them the funds to expand its education division.
The drop in US jobless claims to levels not seen since 1973 will have provoked wistful sighs among senior economists and journalists, but it also caused a revival of US dollar buying that left indices adrift for yet another day. With unemployment now a tamed bear, a September rate hike has become more likely, but given how assiduously the Federal Reserve has prepared the ground for such a move, the market reaction is not likely to be overdramatic.