FTSE down as MPC votes remain unchanged

The FTSE 100, down 43 points, remains above its two-week low but nervousness is still the overriding emotion on trading floors. 

London skyline
Source: Bloomberg

With numerous economic hurdles yet to be cleared Santa’s arrival on equity markets has yet to materialise. 

Considering the current fears over the eurozone it’s not surprising that the Monetary Policy Committee has remained unchanged in its voting. The benefits of average earnings up to 1.4% has somewhat been negated by the increase in unemployment levels back to 6%.

Unchanged eurozone inflation figures will have been met with a sigh of relief from European Central Bank president, Mario Draghi, who has probably used up his entire stock of Santa-tokens in that one wish.

In just over a week interest rates in Russia have increased by 7.5% up to 17%, yet overnight highs in the USD/RUB hit $79.16. Having started the month of December at $51.24, markets are preparing for the Russian central bank to impose capital controls regardless of protestations.

Dixons Carphone's first-half figures are full of festive cheer as the combined company has seen a 30% rise in pre-tax profits, and was ahead of schedule for the completion of the merger. Confirmation that the company was well on track to meet its full-year targets saw the markets move shares higher by as much as 3.5% in early trading.

Saga’s trading update was short and to the point, with the company confirming it remains in line with market expectations leaving traders waiting for confirmation of its long-term strategy in January.

Babcock International has embarked on a little late December shopping and has acquired Defence Support Group from the Ministry of Defence for £140 million.

Triple-digit moves are now the norm as far as the Dow Jones is concerned. European woes, falling oil prices and the collapsing Russian rouble, together with today’s FOMC statement, will be closely scrutinised for indications of the Federal Reserve’s interest rate rising agenda.

Out of sync with the standard reporting periods for US corporations, both FedEx Corp and Oracle Corp will be posting second-quarter figures today.

Ahead of the open we expect the Dow to start 80 points higher at 17,360. 

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