Stock markets have made another 180 degree turn, recovering from Tuesday’s losses, with the FTSE 100 up 90 points in afternoon trading.

  • Stock markets move higher together
  • Broad buying lifts all boats, but tech and small caps lead
  • Oil’s near-term outlook in OPEC’s hands

US markets joined in the general rally in stock markets this afternoon, after comments from the BioNTech CEO overnight and further data suggesting the Omicrom variant is less severe than others helped investors to build a more bullish outlook. November went out on a decidedly poor note, a relatively rare event, especially following such a strong October, but it looks like the buyers that failed to show up yesterday have come back in strong form today. Fed chairman Powell remained broadly confident on the outlook for the global economy, and from the looks of it the volatility of the past few days is subsiding into a ‘buy the dip’ approach from most investors. Tech and small caps have led the way, a classic ‘risk on’ move, but the fact that European and US indices are moving higher in lockstep does suggest that this buying is more durable, instead of the selective move into tech stocks we saw earlier in the week when we had even less data on the new variant than we do now. 

A strong ADP report and a fairly solid ISM manufacturing PMI also provided reason for optimism, and this has stabilised the oil price after the dramatic falls earlier in the week. Attention now turns to OPEC, but the cartel is likely to keep production either unchanged, or perhaps even throttle back on planned increases, given that the global economic outlook has clouded of late, and the 20% drop in the price that has helped to ease short term concerns about oil costs acting as a drag on economic growth.

 

This information has been prepared by IG, a trading name of IG Markets Limited. In addition to the disclaimer below, the material on this page does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. IG accepts no responsibility for any use that may be made of these comments and for any consequences that result. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. Any research provided does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it. It has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Although we are not specifically constrained from dealing ahead of our recommendations we do not seek to take advantage of them before they are provided to our clients.

Feed news

Latest Forex Analysis


Latest Forex Analysis

Editors’ Picks

EUR/USD struggles to rebound, holds near 1.1150 after US data

EUR/USD trades around 1.1150 in the early American session on Friday as investors assess the latest inflation data from the US. According to the US Bureau of Economic Analysis, Core PCE Price Index rose to 4.9% on a yearly basis in December from 4.7% in November, surpassing the market expectation of 4.8%. 

EUR/USD News

GBP/USD clings to small gains above 1.3400 on mixed US data

GBP/USD posts modest daily gains slightly above 1.3400 on Friday as the dollar rally loses steam. The data from the US showed that the core PCE inflation edged higher to 4.9% in December. On a negative note, Personal Spending contracted by 0.6% on a monthly basis.

GBP/USD News

Gold recovers modestly after US data, stays below $1,800

Gold managed to stage a rebound from the multi-week low it set below $1,780 but continues to trade deep in the red near $1,790. The benchmark 10-year US Treasury bond yield is rising more than 1% on the day after US data, limiting XAU/USD's recovery.

Gold News

Bitcoin Weekly Forecast: Federal Reserve cannot tame BTC’s uptrend

Bitcoin has experienced some significant losses over the past few weeks, with a more dramatic drop occurring this week after the Fed's decision was announced. As losses have extended and BTC has entered into the $30,000 zone, concerns regarding Bitcoin being in a bear market have increased.

Read more

Apple share price set to rise after another record quarter

With the Nasdaq closing at its lowest level in seven months yesterday, the Apple share price has also found itself on the end of the recent weakness in tech shares, down over 12% from its record highs in early January.

Read more

Majors

Cryptocurrencies

Signatures