At mid morning in London we have seen some slight gains for UK stocks in what has been a quiet session so far.
Banking stocks and miners are still under pressure, weighing on the index so far and cancelling out much of the gains seen in the other sectors.
UK economic news continues to paint a slightly rosier picture than we have been used to over recent months. Retail sales for April are up by 4.6% compared to the same month a year ago, with a good performance in food sales lifting the Tesco share price up by around 3%. These shares are now 15% higher than mid-March lows and traders seem happy to buy into any dips, with some looking for a run back to the highs for the year, above 370p.
Manufacturing output dropped in the first-quarter of the year, but this decline was at the slowest rate for a year. These retail and manufacturing numbers would seem to add more strength to the argument that recessionary pressures may be slackening. However with the strong bounce backs seen since the March lows for the UK stock market, it looks like this has already been factored in, hence the somewhat muted response.
Looking ahead to the US open, at the moment we are expecting the Dow Jones index to open up 50 points higher from yesterday’s close.
Again it’s a fairly quiet day on the economic calendar in the US. There seems little out there to give much of an impetus in either direction so it would not be surprising to see choppier trading across all stock markets as the day unfolds.
Also see today’s market update, Spread Trading.
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