7th Oct 2013 09:39
LONDON (Alliance News) - London's equity indices all are firmly lower Monday, following negative moves in Asia overnight and as investors around the world continue to await developments from Washington on the US government shutdown.
By mid-morning the FTSE 100 is down 0.9%, at 6,398.40, the FTSE 250 is down 0.9%, at 14,707.75, and the AIM All-Share is off 0.2% at 781.48.
European markets are faring no better. In Germany, where Chancellor Angela Merkel is still trying to form a government, the DAX is down 1.2%, while in France the CAC40 is down 1.2%.
Every FTSE 350 market sector is in the red with general retailers performing the worst so far, down 1.7%. Real Estate stocks are faring the best, the sector only down 0.2%.
Of the very few blue-chip gainers, William Hill is notable, the book maker trading 0.5% higher on the back of ratings upgrades following an analyst event on Friday.
Rolls-Royce is up 0.4% after saying that it has been awarded new contracts to the value of USD496 million from the US government and that its engines were included in a large order of Airbus jets by Japan Airlines.
The dollar remains generally weak against other currencies as the shutdown continues. Currently the pound trades at USD1.6064 and the euro at USD1.3580.
With very little progress in Washington over the weekend, the passing of a budget still is looking a long way off. US Treasury Secretary Jack Lew said Sunday that Congress is "playing with fire" as both the White House and Republicans remain entrenched, refusing to negotiate their positions.
US President President Obama called for an end to the "farce".
The ongoing situation seems to leave markets little choice but to drift down, with the willingness to take risk gradually shrinking until either a compromise is reached or the US makes dubious history by breaching its debt ceiling.
"With little economic data coming out in the US, we'll be flying blind and, presumably, nervous as a result" comments Societe Generale strategist Kit Juckes.
With no major data releases scheduled for the rest of Monday there seems little choice but for traders to remain focused on political updates from the US.
By Jon Darby; [email protected]; @jondarby100
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