FTSE marks time yet again

Heading into the close the FTSE is ten points higher, with miners leading and housebuilders lagging. 

City of London skyline
Source: Bloomberg

The relentless sideways price action that characterised September appears to be back with us. Neither buyers nor sellers have been able to establish a clear trend so far this week, and with non-farm payrolls getting ever closer that is unlikely to change. 

There has been an unseemly rush for the exit in housebuilding companies today, prompted by broker coverage that chimes in with fears about a UK rate hike. After years of good living, returns are likely to shrink, causing some to question whether valuations in the sector are sustainable.

It is Standard Chartered, however, that is really feeling the pinch, with the shares down 7%. By contrast, the mining sector, so long the underperformer of the index, has rallied strongly, with small inroads being made into losses of recent sessions.

Some hopes that global manufacturing may be on an improving trajectory have helped the sector, but it would be brave to suggest that this is the beginning of a more sustained rally into year-end.

After a shaky start US indices are rising once again, confirming that there is life left in this rally. With little to go on in terms of economic data momentum seems to rule the day, although latecomers to the equity bounce may be feeling nervous tomorrow when Janet Yellen testifies to US lawmakers.

Facebook earnings are yet to materialise, but may well enliven things for today’s laggard, the Nasdaq. Investors will be keen to see if the social media giant still has the magic touch, something that appears to be eluding Twitter.

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