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Comments about market complacency regarding US interest rates jolted investors out of their slumber in the US session yesterday, and that downward momentum has been carried across into UK and European markets this morning.
The report from the San Francisco Federal Reserve that kicked off this latest bout of excitement is merely a cautionary warning shot to remind investors that change will be coming at some point, and doesn’t reflect any fundamental change in US monetary policy. Nonetheless, with markets having been noticeably over-extended in recent weeks, the pullback should be of short duration.
A shiny new gadget from Apple and larger iPhones were not enough to keep its shares in positive territory yesterday, but then the company was always facing an uphill struggle to overcome the weight of expectations that had built up in advance of the result. The new watch and other developments are not groundbreaking in the manner of the iPhone and others, and thus Apple’s transformation to a solid but uninspiring company continues.
Ahead of the open, we expect the Dow Jones to start 12 points higher at 17,025.