Dow and FTSE 100 stage a recovery
Heading into the close, the FTSE 100 is up 40 points, rebounding along with that other recent relative poor performer, the Dow Jones.
- Stock markets on the rise as Powell reappointed
- Shortened Thanksgiving week points towards quieter period for markets
- European markets look through worsening Covid situation
After some initial weakness stocks have found their footing, moving higher in the afternoon session. The reappointment of Jerome Powell marks the return of the approach pursued by new US presidents since 1980, namely reappointing the incumbent Fed chair in order to provide the continuity that markets crave. This has provided the trick for a market bounce this afternoon, although to be fair to the occupant of the Oval Office that was not his main intention. The warm words for Powell obscure the fact that it was going to be easier to get Powell through at a time when legislative wins are very much at the top of the agenda. Why risk political capital on a minor point when there are bigger battles to fight?
With US markets losing interest in the situation from Wednesday on as the US looks toward Thanksgiving, and the reappointment of the Fed chairman out of the way, the week is in many ways already over. Equities traditionally do better around Thanksgiving and into the end of November, and the continued resilience comes despite the worsening situation in Europe and a still-unsolved supply chain problem. But it never pays to argue with a market as strong as this one, and it is notable that recent laggards such as the Dow, FTSE 100 and Russell 2000 are finding support today, indicating that there is still a willingness to buy on weakness.
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