Equity markets remain positive amid investor optimism (3pm GMT)

<p>Strong commodity prices were enough to drive FTSE up for a fourth session in five trading days. With copper trading at record highs above $463, mining equities […]</p>

Strong commodity prices were enough to drive FTSE up for a fourth session in five trading days. With copper trading at record highs above $463, mining equities added to Fridays gains, pushing the FTSE up some 40 points.

Randgold Resources was the stand out miner, adding 2% after posting solid results and raising its dividend forecast. Xstrata managed 3 % gains as Citigroup increased their price target and confirmed its buy rating, whilst Nomura flagged the miner as a top buy alongside Anglo American.
Outside of the mining sector, Arm holdings took centre stage once again as Numis upgraded the Tech Hardware giant, posting a 660p price target. Arm Holding investors have been handsomely rewarded in recent months, and the rally seems to show no signs of abating just yet. The outlook for the UK chip designer remains positive enough that investors were keen to add to positions rather than crystallize profits.

With a lack of macro data emerging at least until later in the week, it is likely that the market will remain in its current upward trend with nothing of note in investors headlights to hamper appetite for risk. Investors remain confident of prospects for global equities, so much so that poor US employment data on Friday was shrugged off with ease as the Dow closed on 18 month highs.

With investors adopting a ‘no news is good news’ mantra there is little reason to see any reversal in the short term.

Whilst in the UK traders will be mindful of the Bank of England rate decision later in the week, the decision is unlikely to herald any surprises. That said, traders are showing signs of increasing belief that a rise could come this side of the summer. As the prospect of a rate rise intensifies buyers of sterling are pushing the currency toward important resistance levels that if breached could see the pound posting highs not seen since late 2009.

 

Join our live webinars for the latest analysis and trading ideas. Register now

GAIN Capital UK Limited (trading as “City Index”) is an execution-only service provider. This material, whether or not it states any opinions, is for general information purposes only and it does not take into account your personal circumstances or objectives. This material has been prepared using the thoughts and opinions of the author and these may change. However, City Index does not plan to provide further updates to any material once published and it is not under any obligation to keep this material up to date. This material is short term in nature and may only relate to facts and circumstances existing at a specific time or day. Nothing in this material is (or should be considered to be) financial, investment, legal, tax or other advice and no reliance should be placed on it.

No opinion given in this material constitutes a recommendation by City Index or the author that any particular investment, security, transaction or investment strategy is suitable for any specific person. The material has not been prepared in accordance with legal requirements designed to promote the independence of investment research. Although City Index is not specifically prevented from dealing before providing this material, City Index does not seek to take advantage of the material prior to its dissemination. This material is not intended for distribution to, or use by, any person in any country or jurisdiction where such distribution or use would be contrary to local law or regulation.

For further details see our full non-independent research disclaimer and quarterly summary.