Dax hits record but FTSE 100 in the red again

Chris Beauchamp IG

Mining stocks have dragged down the FTSE 100 again, leaving it behind while other indices make fresh gains ahead of US jobs data this week, says Chris Beauchamp, Chief Market Analyst at online trading platform IG.

FTSE 100 slips lower

“While the Dax hits a new record high and the Nasdaq 100 starts to move higher again, the FTSE 100 has been left out. Losses in commodity prices have sent the mining sector into retreat, weighing on the index. The year that started so well for the FTSE 100 has turned into yet another dismal period of underperformance. International investors continue to avoid the UK, starving the FTSE 100 and its constituents of the flows needed to fuel a proper rally.”

Is a ‘Santa rally’ still possible?

“Investors can be forgiven for worrying that they have already received their presents, in the form of an astonishing rebound for many indices. The Dow’s straight-line 12% surge from the October low shows no sign of going into reverse, but with so much good news priced in it seems that Santa has already delivered his rally. Barring a sudden drop in payrolls this week, 2023 might go out with a whimper rather than a bang.”

Author

Chris Beauchamp

EUR/USD makes a U-turn, focus on 1.1900

EUR/USD’s recovery picks up further pace, prompting the pair to retarget the key 1.1900 barrier amid further loss of momentum in the US Dollar on Wednesday. Moving forward, investors are expected to remain focused on upcoming labour market figures and the always relevant US CPI prints on Thursday and Friday, respectively.

GBP/USD sticks to the bullish tone near 1.3660

GBP/USD maintains its solid performance on Wednesday, hovering around the 1.3660 zone as the Greenback surrenders its post-NFP bounce. Cable, in the meantime, should now shift its attention to key UK data due on Thursday, including preliminary GDP gauges.

Gold holds on to higher ground ahead of the next catalyst

Gold keeps the bid tone well in place on Wednesday, retargeting the $5,100 zone per troy ounce on the back of modest losses in the US Dollar and despite firm US Treasury yields across the curve. Moving forward, the yellow metal’s next test will come from the release of US CPI figures on Friday.