All attention is focused on AstraZeneca this morning, as the shares dive 14% following the decision of the firm to spurn Pfizer’s advance. Such a big move in a weighty stock like Astra is bound to leave the index floundering but it is merely a symptom of a wider problem, namely that the market remains directionless after the highs of last week.
Banks are hobbling any attempt to push higher too, following a report that showed a 9% slump in revenues at the world’s 10 largest institutions, as big financial firms shift away from riskier forms of trading.
At least easyJet is bucking the trend, as the market looks afresh at the company following yet another weak update from rival Ryanair. If the FTSE’s drift lower persists much into this week we could see the bears take over, and they will be looking to frolic in the sunnier weather after enduring the short-lived surge of last week.
US markets finished the week off the lows but the situation is looking grimmer by the hour. There isn’t even any macro data this afternoon to keep markets in check, which leaves us to trust in sentiment. This has not been particularly strong in recent sessions, so traders will keep a keen eye on the 16,400 level for the Dow Jones and 1866 for the S&P 500, which have acted as firebreaks to halt the selling over the past few weeks.
Ahead of the open, we expect the Dow to start 60 points lower at 16,430.