Joshua Mahony MSTA
Scope Markets
The FTSE 100 is outperforming amid a data driven rise in rate cut expectations. Meanwhile, the miners are helping enhance those gains after Chinese data points towards a ramp up in investment and industrial production.
- FTSE 100 outperforms as rate cut hopes drive the pound lower
- Miners help push FTSE higher
- Chinese data sees investment and industrial production rise
The FTSE 100 has seen a sharp surge as we close out the week, with the growing prospect of a rate rise from the BoE helping drive the pound lower. Rounding off a week which has seen rate cut expectations soar, the release of a hugely disappointing retail sales number for December provided yet another reason to expect action from Carney and co. While next week provides us with another set of data-points, the inflation and retail sales numbers seen this week have put to bed the notion of a huge surge in spending in the wake of the UK election result. With rate cut expectations now resting at 65%, all eyes will be cast towards the UK jobs report and PMI figures as a driver of sterling volatility ahead of the BoE meeting.
UK listed miners have been driving a significant chunk of the FTSE 100 gains today, with the US-China trade deal ramping up hopes of a resurgence after an uncertain period. The push towards an environment with less tariff and more global trade can only be a good thing for commodities, with China showing signs it is ending a multiyear slide in economic data. With fixed asset investment and industrial production both beating market expectations, it is clear that base metal demand will likely increase in the months following this trade deal.
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