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FTSE tumbles but news isn't all bad

Tue, 16th Jul 2019

The top share index in the UK fell sharply on the penultimate session of the week as UK markets caught up with the parallel tumble in the US indices. By the close of trade, the FTSE 100 was down by 1.19 per cent ending the day on 6344.

The US was rocked by the news that unemployment figures have risen by the biggest notch seen since November, charging higher to 385,000 compared to the 350,000 predicted. The unanticipated spike led to a hefty drop in US markets on Wednesday evenings as investors debated whether the recent signs of economic improvement were anything other than a false dawn.

Elsewhere, Thursday was the day for a raft of central bank announcements. Whilst the UK, as expected, saw no change to monetary policy, the president of the European Central Bank seemed to be taking a dovish approach. However, the real news was in Japan where the central bank opted for a bold monetary easing policy in a radical move to try and kickstart the economy.

Back in the UK, there was another hint of good news as the vital services sector saw a climb in the purchasing managers' index, with the figure climbing to 52.4, up from 51.8 in February and firmly on the right side of the cut-off for contraction or expansion (50 points).

Vedanta Resources was once again flying high, climbing by 6.05 per cent after the Indian court in Goa gave the thumbs up to its planned restructuring. It still has some legal hurdles to climb but the stock has a feel-good factor with plenty of optimism surrounding its future.

FTSE 100 Latest
Value7,531.72
Change25.75