Fed statement and weak data sends FTSE lower

Heading into the close the FTSE 100 is down 45 points and with less than an hour to go looks unlikely to finish too far off its lows.

Markets have failed to recover from the negative sentiment imbedded in traders’ minds following last night’s FOMC statement, and with EU unemployment figures unexpectedly heading higher, Europe has given the FTSE no reason to rebound.

UK markets

With Royal Dutch Shell, one of the FTSE 100’s largest constituents, posting some rather awful figures and spending most of the day off by almost 5%, the FTSE has behaved relatively well. The triple-whammy of higher production costs, output disruption and squeezed margins have seen Shell’s third-quarter profit come in well below market expectations and substantially below last year’s figures.

Chilean copper miner Antofagasta has also been punished by the markets, although the firm stated it is on track to meet full-year targets for 2013. This is unfortunately is a little short of the targets set by analysts and as such the miner has found itself down by 4% throughout the day.

BT Group, having successfully launched a new sports channel arm, has seen some of the benefits already with client revenue at its highest level in a decade. A large part of the credit for this must go to the two million subscribers of the new sports package; a number that rises to four million when add-on deals with other providers are factored in.

US markets

The US trading day has started off with a bang following Chicago PMI figures that have been smashed out of the ballpark. Expected at 55, the 65.9 figure posted has caught traders by surprise, but does put last night's Federal Reserve comments in a different light. As tends to be the case, the Fed comments were open to interpretation and left enough room for both bulls and bears to take something out of them. That being said, US markets declined, triggering a global sell-off as first Asia, then Europe followed suit.

After a day of macro issues dominating traders’ minds, we are back to sifting through the tail end of the US reporting season. Among the big names reporting third-quarter figures later are Time Warner Cable, Avon Products, Invesco, Mastercard and Exxon Mobil.

Facebook issued its Q3 figures last night, and Mark Zuckerberg, the world’s most highly remunerated CEO in 2013, will have been pleased to see revenues increase by 60%. No doubt Twitter's management, about to embark on its own US listing, will have been particularly interested in the company’s efforts to convert its two billion users into a tangible revenue stream.

Commodities

Gold has now fallen for a third day in a row after failing to break through technical resistance just north of the $1360 level. The big question mark that was hanging over the US dollar has to an extent been cleared up following last night's Fed comments. It’s hard not to get the impression from gold and silver that these two metals are about to begin the next leg of their ongoing jaunt lower. Copper continues its merry dance sideways as the tight range it has been bound by for the last month remains in place, following its half-hearted efforts to break higher yesterday.

FX

In the last 24 hours economic releases from both sides of the Atlantic have attempted to instigate a move in EUR/USD. Ultimately the euro weakening after news that EU unemployment had unexpectedly jumped has tipped the hand of the US dollar, contributing to the 150-point decline from its highs at the tail end of last week. Following a similar vein GBP/EUR has also seen a decent jump on the back of this morning’s EU unemployment data, although the pair has cooled a little from its 100-point move higher earlier in the day.

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