FTSE higher on the day but lower on the week

After spending much of the morning hugging the flatline, the FTSE finally took off shortly after Wall Street opened. EasyJet flew in to the top spot on the leader board, whilst banks were the best performing sector. On the downside Berkeley Group was heavily out of favour after announcing it won’t be increasing production further, whilst remaining cautious about future investment given the slowdown in the property market.

After spending much of the morning hugging the flatline, the FTSE finally took off shortly after Wall Street opened. EasyJet flew in to the top spot on the leader board, whilst banks were the best performing sector. 

On the downside Berkeley Group was heavily out of favour after announcing it won’t be increasing production further, whilst remaining cautious about future investment given the slowdown in the property market. 

The FTSE was heading towards the close 0.5% higher, however this will be a case of too little too late as the index remains on track for it’s a weekly loss of around 0.6%.

EZ inflation ticks lower

European stocks are charging higher, pulled along by a positive start in the US, whilst supported by knowledge of monetary policy tightening still being a distant future thought, given the falling level of inflation. CPI printed as expected falling to 1.2% year on year in February, down from 1.3% the previous month. The euro, dived lower on the reading.

White House revolving door continues to spin

Politics and the revolving door at the White House has left Wall Street wary after a week of heavy volatility. The Dow is trading just 85 points higher, whilst the S&P is up 0.3% and the Nasdaq is seen dipping into negative territory.  

Despite all the action this week, the revolving door shows no signs of slowing down yet, with rumours circulating that Trump will release national security advisor Lieutenant General HR McMaster. This comes just days after Rex Tillerson was removed and a week after Gary Cohn decided to step down. 

In response the dollar weakened in early trade reflecting the fact that chaos is alive and well in the Trump administration.

Dollar rallies as US consumer sentiment hits 14 year high

Dollar weakness was short-lived as the focus switched to data. Data from the US was once again mixed, although the strength in the dollar suggests that traders were focusing on the upbeat consumer sentiment, at its best level since 2004, rather than the weak housing starts.

Housing starts fell dramatically to -7%, down from 9.7% increase in January and well shy of the -2.7% forecast. Consumer sentiment as measured by the University of Michigan confidence unexpectedly climbed in March, hitting 102, significantly above the 99.3 forecast and the 99.7 from the previous month.

This week the focus has been firmly in Washington, however the consumer sentiment figures are helping reposition the market’s attention back to economic data ahead of next week’s FOMC meeting.

EUR/USD slides on US data

EUR/USD in on track for its third straight day of losses, as it dived through $1.2270 and its 50 day simple moving average on strong US consumer confidence data. The pair is trading at its lowest level since early March. 

A meaningful break below here could see $1.22 lined up as the next target. On the upside a move back above $1.23 could see the pair make an attempt to break resistance at $1.2360.

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