FTSE 100 surges after BoE hints at rate cuts to come

Chris Beauchamp IG

Rate cuts are on the horizon in the UK, while stocks continue to surge in the wake of yesterday’s Fed meeting, leading to a very solid day for equity markets, says Chris Beauchamp, Chief Market Analyst at online trading platform IG.

FTSE 100 soars to ten-month high

“Markets have continued their euphoric reaction to this week’s central bank events, with the FTSE 100 closing in on 7900 for the first time since May last year. UK stocks have lagged far behind, but with the Bank of England now on a path to cutting rates we could see the FTSE 350 make further strides as the flow of investor money finally heads to the UK.”

US markets continue their gains

“Rarely as a ‘no change’ policy meeting produced quite the excitement as last night’s Fed meeting. While nodding towards stronger than expected, the Fed’s decision to stick to current plans has resulted in yet more record highs for the Dow, S&P 500 and Nasdaq 100. Things do seem to be getting a little excessive in markets, especially since the S&P 500 has yet to register a pullback of more than 3% so far this year.”

Author

Chris Beauchamp

EUR/USD holds lower ground near 1.1850 ahead of EU/ US data

EUR/USD remains in the negative territory for the fourth successive session, trading around 1.1850 in European trading on Friday. A broadly cautious market environment paired with modest US Dollar demand undermines the pair ahead of the Eurozone GDP second estimate and the critical US CPI data.

GBP/USD keeps losses around 1.3600, awaits US CPI for fresh impetus

GBP/USD holds moderate losses at around 1.3600 in the European session on Friday, though it lacks bearish conviction. The US Dollar remains supported amid softer risk tone and ahead of the US consumer inflation figures due later in the NA session on Friday.

Gold trims intraday gains to $5,000 as US inflation data loom

Gold retreats from the vicinity of the $5,000 psychological mark, though sticks to its modest intraday gains heading into the European session. Traders now look forward to the release of the US consumer inflation figures for more cues about the Fed policy path. The outlook will play a key role in influencing the near-term US Dollar price dynamics and provide some meaningful impetus to the non-yielding bullion.