Stocks surge despite Washington worries
|The FTSE has bounced back following a dour week so far. However, with a decision to be made on Trump’s medical plans, uncertainty remains.
• Stocks jump despite impending vote in Washington
• UK retail sales tells a mixed picture
• Article 50 to kick off a volatile 2-year period for pound
Fears over a potential roadblock in congress have seemingly been put on the backburner for European markets, with a noticeably more optimistic tone being struck on the FTSE despite the impending decision from Washington over Trumps plans to replace Obamacare. Ultimately where we find ourselves this time tomorrow will be heavily influenced by the decision from the House of Representatives, who hold the markets destiny in their hands.
This morning’s surprise outperformance for UK retail sales served to spark yet another surge in the pound, with consumers bouncing back despite clear impending headwinds for the economy. However, coming off the back of two negative readings, it is clear that consumers are struggling with the new norm of higher priced goods thanks to rising prices on imported goods.
While we are less than a week away from article 50 being enacted, it is not the day of commencement that is important, but instead the following weeks and months. There is likely to be leaks throughout the negotiation process, as both sides seek to get their own way. FX traders should brace themselves for a seriously volatile two years for the pound.
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