Stocks continue to see powerful rally

Chris Beauchamp IG

In mid-morning trading, the FTSE 100 is up 30 points, as stock markets continue their push higher in the face of bad economic data.

Europe adds to recent gains
No sign of the rebound stopping yet
Increased orders bolster Just Eat

European stocks have already made solid, if unspectacular, gains this morning, and while these are not like the big moves higher of the past few weeks, the quieter mood is a more positive sign for the long-term. Yesterday saw an impressive recovery for US markets, with 90% of issues on the NYSE moving higher for the second session in a week, a rare occurrence but one that points towards solid returns in the near term. It looks like this much-derided rally still has some way to go, frustrating those expecting further declines. Buyers should tread carefully, however, since the economic outlook remains grim, hardly a conducive environment for equities in the medium-term.

Just Eat Takeaway.com has shot to the top of the FTSE 100 this morning, up almost 10% today and 35% from the March lows. While today’s numbers are strong, the outlook for this firm at least seems bright, given that the UK’s lockdown seems to have much further to go, while even those of continental Europe have yet to show any indication that they will be completely lifted in the near-term. The only worry will be whether consumer spending can do its part, or whether citizens will next cut back on their takeaway spending as supermarket shopping becomes more predictable once again.

Ahead of the open, we expect the Dow to start at 23,434, unchanged from yesterday’s close.

Author

Chris Beauchamp

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