The FTSE 100 ticked higher at the start of the new trading week amid robust gains across Asia.
Investors seem willing to park any concerns about the ongoing crisis in the Middle East as last week’s softer-than-anticipated inflation numbers saw fears of an imminent rate hike from the US Federal Reserve subside. Combined with strong earnings from the tech space and you’ve had the conditions necessary for a healthy pick-up in sentiment.
That improved sentiment may be tested as the interim ceasefire agreement between Washington and Tehran expires. The longer we go without any sort of resolution, the more likely we are to see Brent crude oil test the $100 per barrel mark seen in recent months.
It could mean any relief on inflation is temporary. As markets seek to divine the likely trajectory of both rates and prices, UK inflation figures and minutes from the latest Federal Reserve meeting – both set for the middle of this week – could be instructive.
In London, miners clawed back some of the ground they lost last week, helped by strong precious metals prices, with weakness seen in consumer-facing stocks.
A notable rise for Johnson Matthey followed a share consolidation taking effect as it paid out a bumper special dividend from the sale of its Catalyst Technologies arm.
Budget retail chain The Works continues to face pressure from activist investor Kelso – which is now questioning the work-from-home approach taken by the company’s New Zealand based chair Stephen Bellamy. This is unlikely to be the last word in the tête-à-tête between management and Kelso ahead of a crunch shareholder meeting next month.
Dan Coatsworth: Head of Markets
Dan Coatsworth is AJ Bell's Head of Markets. Dan has been with the company since December 2012 and has more than 18 years' experience in the industry, following the markets and all things investing. He...
