| |
NewswireToday - /newswire/ -
London, Greater London, United Kingdom, 08/31/2010 - Joshua Raymond, Market Strategist of City Index, casts his expert eye over market developments for 31st August.
|
| |
Joshua Raymond, Market Strategist, City Index commented: “The FTSE 100 opened 1% lower tracking weakness in the US last night and Asia this morning as traders continued to fret about the strength of the economic recovery.
Nikkei fall send shockwaves to European trading
We have investors returning, somewhat slowly, to the market after the bank holiday weekend and clearly they are taking their lead from the large falls in US markets overnight, which eradicated any gains from Fridays Jackson Hole induced rally.
Traders have not taken comments made by President Obama in the positive light that he would have hoped and it seems that Friday’s better than expected US GDP number has quickly been forgotten amongst those pessimistic about recovery efforts. Moreover, the Nikkei suffered its worst daily fall in three months this morning which has sent a bit of a shockwave through trading in Europe this morning.
I would hope that the recent weakness is purely a feature of light volumes exacerbating market moves than sentiment turning dramatically bearish. With Non Farm Payrolls due out later this week, traders could simply be putting the shutters up in fear of a bad number, particularly after Bernanke’s’ comments.
Miner and Banks suffer
Much of today’s equity weakness is focused on the miners and the banks, two sectors that are sensitive to the strength of the recovery.
Barclays is one of the biggest fallers on the FTSE 100 today, with its shares off 3% and hurt by concerns over the economic recovery. We have seen clients downsize their positions in the bank to minimise their risk exposure.
We have also seen weakness in commodities such as the miners and oil firms on risk aversion and falls in the prices of Crude oil and Copper, which had hit a three month higher yesterday.
Serco falls on BofA/Merrill Lynch cut
There has been some significant selling in shares of Serco with traders taking their lead from a downgrade in the stock by Bank of America/Merrill Lynch, who cut their rating on the stock to a ‘neutral’ stance on uncertainty over the effect of the collation government’s spending review which is set to come out in October.”
For more on indices spread betting and CFD trading, visit CityIndex.co.uk/.
About City Index
Today more and more individual traders are discovering the benefits of derivatives, and many of them are discovering them through a City Index trading platform.
As a group, we transact in excess of 1.5 million trades every month for individuals in over 50 countries worldwide. We provide access to a wide range of instruments including margined foreign exchange, contracts for differences (CFDs) and, in the UK, spread betting.
We constantly look to widen the range of assets we offer, improve the performance of our platforms and expand the range of services we provide. The result is that our customers benefit from innovative trading tools with transparent pricing, competitive spreads, and a high standard of customer service and support.
|
joshua.raymond[.]cityindex.co.uk 
