Something odd appears to be happening this morning. The FTSE 100 is enjoying its second ‘up’ day in a row, building on yesterday’s move that lifted it away from the 6000 level. It still feels as if markets are simply looking to catch their breath after all the excitement of the past week, and so it is perhaps unwise to suggest that two days of positive trading make a trend. The imminent announcement of the spending review is not going to have too much bearing on markets, but it will be interesting to tot up the likely winners and losers from George Osborne’s speech.
The banking sector is in strong form this morning, rising in sympathy with Standard Chartered after the Asia-focused behemoth posted a welcome return to form. A low single-digit growth rate isn’t going to set the world on fire, but it is certainly better than the struggles being seen at state-backed firms RBS and Lloyds Banking Group, with the added benefit of a concentration in healthy emerging markets. Also reporting a reasonable performance was packaging group Bunzl, which is expected to perform in line with forecasts despite a rash of acquisitions that has pushed up costs.
Once again US economic data takes centre stage this afternoon, with the final reading of first quarter GDP coming through. Yesterday’s data was able to enliven markets to some degree, so those whose outlook is ‘glass half full’ will be hoping that a surprise boost to GDP can put Wall Street in the mood for further gains. Ahead of the open, we expect the Dow to open 30 points higher at 14,793.