FTSE snaps losing streak with gains

After 4 straight sessions of losses the FTSE is making up for it and more. The FTSE surged higher on the open then maintained those gains throughout the session, finding support from GSK on the back of the Novartis deal and from Ferguson following a $1 billion special dividend jackpot. 

A slightly softer pound and easing of trade war fears ensured the FTSE ventured back above 7000, although the index closed a whisper below this important psychological level.

In the forex markets the dollar was seen finding its feet again after a rough previous week last week and further losses on Monday. 

With no response yet from Russia over the expulsion of 60 Russian diplomats from the US and trade war fears easing, geopolitical downward pressure on the dollar is reducing. As a result, the dollar is gaining ground, even though consumer confidence data, surprised to the downside.

US Consumer confidence dips for first time in 2018

Last month’s surge in consumer confidence was not repeated in March, with the sentiment actually declining to 127.7, below 130.8 the previous month, in the first easing of sentiment this year. 

The softening of sentiment in March reflects tempered optimism towards the economic outlook. However even with the easing back in sentiment the mood still remains fairly upbeat owing to the solid growth in the labour market and recent tax cuts, which have the potential to increase disposable income and drive spending higher.

EUR/USD lower on softer Eurozone sentiment

Sentiment was also weak in the eurozone, pulling back sharply in March as fears continue to grow over slowing of momentum in the bloc’s economy. EUR/USD has been trending lower throughout the day on weak eurozone sentiment and a stronger dollar. 

After peaking overnight at $1.2477 the pair has now settled at $1.24. With no further influential data in the US session, investors will start to look ahead to the German GFK confidence index tomorrow and US GDP tomorrow afternoon. 

With weaker confidence spreading across Europe, particularly in Germany and an increase in US GDP forecast to 2.7%, the EUR/USD could find itself under pressure once again.

Wall Street Extends Gains

Wall Street is building on the impressive gains from Monday, although the rally is clearly running on less steam. 

The Dow gained a more standard 80 points, after Monday’s historical bounce whilst the S&P was trading 0.1% higher. 

Confidence is returning to the markets, as hopes build that China and the US will work out a deal that sits well with both leaders. Consequently, traders are putting risk back on the table sending equities higher.