Heading into the close the FTSE 100 is ten points higher, clinging on to gains as US markets move deeper into the red.
- Stock markets struggle to move higher
- US political moves hit Wall Street
- Sterling rises on hopes of a Brexit deal of some sort
The small gains in Europe and modest losses in the US sum up an indecisive session for stock markets, and indeed, apart from the initial huge rally on 9 November, an indecisive three-week period. Equity markets have been noticeably unable to break through their high from earlier in the month, despite further vaccine news, and as we head towards the final full week of November stock markets are still scrabbling around for a catalyst to drive them higher. Speaking of catalysts, it is noteworthy that Mnuchin’s decision to request the return of funds from the Fed’s emergency programmes is not producing much more downside. It looks like on political matters, just as with vaccine hopes, the market is not looking to next week or even the beginning of December but further into the future, in this case beyond 20 January when Biden is installed as president and a new administration can look at the US’ problems afresh.
The pound continues to take no news as good news, moving up against the dollar and the euro despite a lack of progress in Brexit talks. However, EU ambassadors have been told that a deal is close to being finalised, which continues to reinforce the market’s faith in the unlikely nature of a no deal scenario. While it might be tight, and require some imaginative thinking to essentially pretend that the agreement has been signed, hopes remain high that the UK and EU can reach 1 January with at least a working agreement that can be tidied up as they go along.
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