Yet again we find ourselves in a day with little real economic news. We continue to wait for US data of real weight, which will help in the final run down to the FOMC meeting next week. Overall it seems as if the return of volume after the summer lull has reignited the appetite for equities, suggesting perhaps that the tapering debate has lost some of its power to terrify.
Having added some 60 points this week, the FTSE 100 is looking far healthier than it did during mid-August. Better Chinese news bolstered mining stocks in the early part of the week, although they are seeing some profit-taking this morning. The Royal Mail flotation dominates news, as the government announces that the British institution will be privatised in the coming weeks. IG’s grey market on the valuation has seen steady buyers, with the implication being that the firm will have a market cap of around £2.88 billion on the first day of trading. This puts it just on the cusp of entering the FTSE 100, potentially giving the company a first-class listing on the London market.
Syria continues to dominate proceedings in US markets, ahead of a meeting in Geneva between the Russians and John Kerry. Plenty of diplomatic horse-trading is to be expected, as the Russians revel in their new-found (and somewhat unlikely) role of global peacemaker. The dollar has taken a hit on reduced expectations of September tapering, which has carried USD/JPY below ¥100 once again. Jobless claims enliven the afternoon slightly, but Friday will be the banner day of the week as far as economic news is concerned. Ahead of the open, we expect the Dow to start ten points lower at 15,317.