Traders react aggressively to US reports

Heading into the close the FTSE 100 is up 40 points, looking to close around the 6540 level. 

Markets show confidence

Good news is once again good news; traders welcomed the strong jobs report from the US and aggressively bought into the equity market after unemployment dropped to its lowest level in five years. The US Federal Reserve has been wondering how to wean the equity markets off quantitative easing – this afternoon's activity may show that they are now confident enough to go it alone, and no longer need to use the full bond-buying scheme as a crutch. The year 2014 will be that of the horse according to the Chinese calender – for the financial markets it will be the year of the taper.

Food for thought for next Fed meeting

If the Fed was ever looking for a sign that the markets will not panic if the $85 billion-per-month stimulus package were to be trimmed, today’s jobs report was it. The next Fed meeting is less than two weeks away, and traders seem to be ready for a reduction in the bond-buying scheme. The questions is, are the Fed ready to taper?

Metals rally

Metal prices rallied after the non-farm payrolls report signalled that the global economy is on the mend.

Dollar settles

The US dollar initially rallied in the mist of the post-jobs report excitement, but gradually drifted lower after the dust settled.

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