FTSE sets off at healthy pace

The FTSE is up 36 points after the first hour of trading.

Rolls-Royce engine
Source: Bloomberg

Asian markets' resilience overnight has given European traders a fresh boost of optimism, possibly coupled with the Friday feel-good factor, and helped ensure all the major equity markets steer clear of any red. European Central Bank president Mario Draghi will once again be the focus of early morning traders as he speaks at the 24th European Banking Congress. Markets will be interested to see if there are any new ideas on how to improve the trickle of cash that is coming out of banks and going to small- and medium-sized businesses, while at the same time monitoring his comments for any reference to the mythical European quantitative easing.

Rolls-Royce has benefited on the back of Delta Airlines' order of 50 new Airbus planes, as the British engineering firm will be responsible for providing the $5 billion worth of engines required for the fleet. For the first time this week the FTSE fallers list is not dominated by the mining sector, as 24 hours of stability in the commodities markets has finally given them a little respite. The same can’t be said for Serco as a cloud of uncertainty continues to hang over the company. Having already sold off by some 35% over the course of this week, it has seen another 6% knocked off in the morning session, as markets fret over who they can find as chairman following Alastair Lyons' resignation.

Regardless of the wobbles that both Asia and Europe have had this week, the US markets continue to power on – almost oblivious to anyone else. It is hard to see what might rock the boat, as today is another day with limited corporate announcements and a scarcity of economic data releases. This means calm conditions for US equity markets to carry on plain sailing.

Ahead of the open we expect the Dow Jones to start 57 points higher at 17,776.

IGA, may distribute information/research produced by its respective foreign marketing partners within the IG Group of companies pursuant to an arrangement under Regulation 32C of the Financial Advisers Regulations. Where the research is distributed in Singapore to a person who is not an Accredited Investor, Expert Investor or an Institutional Investor, IGA accepts legal responsibility for the contents of the report to such persons only to the extent required by law. Singapore recipients should contact IGA at 6390 5118 for matters arising from, or in connection with the information distributed.

This information/research prepared by IGA or IGA Group is intended for general circulation. It does not take into account the specific investment objectives, financial situation or particular needs of any particular person. You should take into account your specific investment objectives, financial situation or particular needs before making a commitment to trade, including seeking advice from an independent financial adviser regarding the suitability of the investment, under a separate engagement, as you deem fit. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. In addition to the disclaimer above, the information does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. Any views and opinions expressed may be changed without an update.

See important Research Disclaimer.