The FTSE 100 is expected to open lower on Wednesday as traders paused slightly ahead of the latest round of meeting minutes from the Federal Reserve.
Spread better IG is predicting the FTSE 100 will start Wednesday’s session down 24 points after closing 122 points higher at 5,704 on Tuesday.
Investors seem content to sit on their hands ahead of the release of the minutes from the Fed’s meeting in mid-March when it performed an emergency interest rate cut to around 0% in an attempt to shore up the economy amid the coronavirus pandemic.
“This week’s minutes to that emergency meeting on the 15th March are likely to make for interesting reading given there wasn’t complete unanimity in that decision, even though since then events have moved on quickly”, said Michael Hewson at CMC Markets.
“It is hard to imagine that all Fed board members aren’t now on the same page as the coronavirus death toll rises across the US and the economy shuts down. The most recent jobs number saw payrolls decline by a record 701k, and that’s even before two weeks of jobless claims that are likely to see an April jobs report look like a scene out of the Texas Chainsaw Massacre”, he added.
Despite a positive start, Wall Street ended Tuesday’s session lower overnight with the Dow closing down 0.12% at 22,653 while the S&P 500 dropped 0.16% to 2,659 and the Nasdaq fell 0.33% to 7,887.
Investors are becoming anxious about the effect of the pandemic on the economy as New York reported its highest level of daily fatalities so far.
These jitters made for a mixed performance in Asia earlier today, with the Japanese Nikkei 225 rising 2.2% while Hong Kong’s Hang Seng fell 0.53%.
On the currency markets, the pound was down 0.07% against the dollar at US$1.2328, although sterling could see some catalysts for movement is any updates emerge regarding the condition of Prime Minister Boris Johnson as he battles coronavirus in intensive care.
Significant announcements expected for Wednesday 8 April:
Trading announcements: Hyve Group PLC (LON:HYVE)
Economic data: US Fed minutes
Around the markets:
Sterling: US$1.2328, down 0.07%
Brent crude: US$32.84 a barrel, up 3%
Gold: US$1,650.71 an ounce, down 0.85%
Bitcoin: US$7,375, up 1.19%
The government is urging companies to curtail executive pay packages as a wave of businesses furlough staff and access taxpayer aid during the pandemic – Times
Investor appetite for UK government bonds has hit a three-year high as Britain sought much-needed funds to fight the coronavirus outbreak – Guardian
One-third of the global workforce could suffer financial hardship as the coronavirus destroys jobs, cuts working hours and slashes pay – Telegraph
UK’s six largest accounting firms have staged a virtual meeting to discuss the reputational risk of accepting government funds for furloughing potentially thousands of employees – Financial Times
Embattled airlines have been allowed to delay paying £1 billion of air traffic control fees, in a crucial cash lifeline; the Government could take stakes in troubled airlines including Virgin Atlantic – Telegraph