Biden’s spending spree and strong PMI data overshadows Covid concerns
Posted 4 hours agoSharePrint
FTSE, European indices rise
European stocks have plenty of cheer on the final day of a short trading week, with the Dax and EuroStoxx 50 hitting a fresh all-time high, successfully shrugging off Covid concerns.
News that President Biden is ready to inject a further USD2 trillion into the US economy has been well received. The world’s largest economy will see the huge injection of cash improve roads, railways, broadband and clean energy, while being offset by a rise in corporate taxes. Investors are already pricing in the read-across effect, and a boost to the US economy is good news for the global economy.
Pound shrugs as Construction PMI rises
March 4, 2021SharePrint
The British pound remains range-bound in the Thursday session. Currently, GDP/USD is trading at 1.3977, up 0.16% on the day.
Construction sector rebounds
The UK construction industry accelerated in February with a PMI read of 53.3, up sharply from 49.2. The 50-level separates contraction from expansion, so construction is again showing growth. This is a result of new construction projects in anticipation of stronger economic conditions over the course of the year. February PMIs are pointing to the economy gathering steam, which should be a bullish sign for the British pound. The Manufacturing PMI rose to 55.1, slightly above the estimate of 54.9. The services sector also improved, with the PMI climbing to 49.5, up sharply from 39.5 beforehand. The national lockdown has resulted in pent-up demand, and with the government slowly opening up the economy, we can expect PMI numbers to continue to point upwards.
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Pound hits 1.40 despite soft UK retail sales
February 19, 2021SharePrint
The British pound has posted small gains in the Friday session. Currently, GDP/USD is trading at 1.4000, up 0.18% on the day.
Sterling rallies past 1.40 line
The pound enjoyed an excellent Thursday, as GBP/USD climbed close to 1 percent. The pair has continued to move higher on Friday and breached the 1.40 level, a symbolic level that had held since April 2018. The dollar index has dropped on Friday 0.38%, to 90.24. There is support at 90.00, and a daily close below this level would signal a downtrend for the US currency.
UK Retail Sales slide
UK Retail Sales suffered a miserable start to the year, with a read of -8.2% for January. This was the second decline in three months and the weakest reading since April. This sharp decline resulted from the tighter health restrictions, which severely crimped consumer spending.