FTSE continues to struggle

Markets have turned lower during the afternoon, with the FTSE 100 dropping below 6800, but the focus is on the pound which has come within a whisker of $1.70.

Barclays knocks FTSE back

The FTSE 100 continues to flounder this afternoon, after results from Barclays knocked the index back from a nine-week high. Figures from the bank show that it still has a lot of problems to iron out, as Anthony Jenkins looks to transform the financial titan from an emblem of uninhibited capitalism to one more suited to the post-crisis world. Barclays needs to pull something fairly impressive out at its strategy meeting on Thursday, as it is this that will set the direction for the months to come. Mr Jenkins must continue to rein in the investment bank to suit public tastes, while simultaneously avoiding tipping the division into a death spiral.

Some ghoulish souls have begun reading the funeral rites for Mothercare, after the company was forced to ask for breathing space over a refinancing facility. It was rescued from the brink once before, but the company’s survival as an independent entity is now in serious question, and more than a few firms might now be weighing up the more promising bits of the business.

Twitter shares could head lower

US stocks have struggled too this afternoon, with caution prevailing in the continued lull between non-farms last week and Janet Yellen’s testimony tomorrow. The attention was back on Twitter, whose shares have hit fresh lows following the expiration of a lock-up for employees. The brief recovery in the shares from last week is now over, and those bargain hunters that went in search of deep value are finding themselves being unceremoniously ejected from the stock. Lacking a reason for optimism, it is difficult to see how the shares are going to avoid moving lower from here.

Gold under pressure

It looks like gold is coming under pressure once again, despite surging above $1300 yesterday. Physical demand appears to be on the slide again, and exchange-traded fund selling is beginning to make its presence felt. Some buying has occurred on the back of Ukraine concerns, but for the moment we are still rangebound in the $1280-$1330  band that has prevailed since the beginning of April. 

GBP/USD fails to reach $1.70

In the perverted beauty contest of major currencies, sterling is a clear favourite. Fans of round numbers have been frustrated today, as GBP/USD failed to touch $1.70, but the move through $1.69 from this morning, based as it was on yet another good UK services PMI reading, has carried us back to August 2009 levels. Set against a US economy that is producing mixed signals, and a eurozone that isn’t bouncing back, investors have plumped for the UK, even if there are still plenty of problems this side of the channel. The Bank of England will have to muster all its staying power to withstand the inevitable discussion on rate hikes that is likely to hit soon.

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