FTSE 100 holds firm as miners advance, Scottish Mortgage down 2%.
08:24 , Graeme Evans
Robust mining and retail stocks have underpinned a resilient session for the FTSE 100 index, which is down 7.24 points at 8268.42,
Glencore, Rio Tinto and Anglo American are up about 0.5%, while Africa-based Endeavour Mining has risen 3% or 68p to 2222p due to the record price of gold.
In the retail sector, Sainsbury’s is up 3% or 6.6p to 263.4p in the aftermath of annual results before the weekend. JD Sports Fashion is up 0.7p to 75.7p
US focused tech investors Pershing Square, Scottish Mortgage and Polar Capital are down by 2%, alongside GKN Aerospace owner Melrose Industries.
BP shares are down 2.3p to 357.1p and Rolls-Royce 7.6p lower at 706.8p.
Gold near $3500 an ounce, up 30% this year
07:48 , Graeme Evans
Gold is up by more than 30% this year, having surged to a fresh record of near $3500 an ounce in today’s dealings.
The precious metal has been boosted by the weakening dollar and growing demand for safe-haven assets after confidence in US financial stability was dealt a further blow by Donald Trump’s Federal Reserve criticism.
IG said: “The metal’s rally underscores its role as a hedge against both inflation and geopolitical risk, especially when traditional safe assets like Treasuries come under political scrutiny.”
IG expects the FTSE 100 index to open 17 points lower but adds that leading Wall Street markets are likely to stage a recovery later. The Hang Seng index is about 0.6% higher.
It added: “While Asian markets remained relatively stable, capital flowed out of US equity funds into Asian and European equities.”
Dollar slide continues on Trump's interest rate comments
07:35 , Graeme Evans
The dollar index is on course for its weakest month since 2009, having fallen by almost 6% since the start of April. The pound is at a seven-month high of $1.34.
The greenback’s latest retreat against a basket of major currencies came amid renewed worries over US central bank independence.
Backing the case for pre-emptive interest rate cuts, US President Donald Trump called Federal Reserve chair Jerome Powell “Mr Too Late” and said the economy risks slowing unless the central bank acts.
The comments also impacted equity and bond markets, with the S&P 500 index down 2.4% and the yield on long-dated Treasuries up 10 basis points to 4.90%.
Gold has also extended its year-to-date increase to about 30%.
Deutsche Bank said today: “While potential risks to Fed independence had already generated headlines in recent weeks, yesterday’s market moves were the clearest sign yet of investor anxiety over the topic.”
Gold at fresh record as dollar weakness continues
07:07 , Graeme Evans
The pound has risen to $1.34 after the dollar took a further hit in the wake of Donald Trump’s criticism of Federal Reserve chair Jerome Powell.
Uncertainty caused by the US President’s comments that interest rates should be lower also fuelled demand for gold.
The safe haven metal is trading at a fresh record of $3492 an ounce, while Brent Crude is at $66.57 a barrel after falling yesterday.
US futures are pointing to a steadier session after Trump’s comments yesterday triggered falls of about 2.5% for the Dow Jones Industrial Average and S&P 500 index. Nvidia shares fell 4.5% and Tesla by 6%.
The FTSE 100 index, which closed Thursday’s session unchanged at 8275, is set to open about 25 points lower this morning.
This article was written by Graeme Evans from The Evening Standard and was legally licensed through the DiveMarketplace by Industry Dive. Please direct all licensing questions to legal@industrydive.com.