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GBP/USD Sees Volatility Ahead of Mark Carney’s TSC Appearance

The FTSE 100 has not made up its mind this morning, and after moving upwards early on, it now treads water at 6295.

Vodafone (+2%) lends support, and investors will be glad to see that its update, filled with potential negatives, has not resulted in a move lower as it did when the company last briefed the market in November.

Moving across to financials, we know that the second half of last year was a barren spell for volume-driven businesses, among which ICAP (-1.5%) is at the forefront.

Stock Market Futures Trading

The firm’s update highlights a fall in revenues to December, but interestingly confirms what we have already seen so far in January, which is that volumes are on the increase across the board.

This sector moved to the upside yesterday, and we have noted the shift in sentiment towards this space, showing there is life after the fiscal cliff for trading volumes.

The incoming chief of the Bank of England, Mark Carney, gets a taster session in front of the Treasury Select Committee this morning, and we will look for any insight on what he plans to do once he is in the job.

We also expect a potentially loose stance on the 2% inflation target, which cynics will argue the current regime has ignored anyway.

Interestingly, volatility in the GBP/USD spread betting market has picked up ahead of both this and today’s MPC announcement.

A lack of agenda in the US continues from yesterday, when markets closed flat. For once, events on this side of the Atlantic, with Mario Draghi speaking today following an expected unchanged policy announcement, will lead the news flow.

Currently, we are calling US markets a smidgeon lower, with the Dow expected to open unchanged.

 

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Financial Market Comments from Will Hedden, Sales Trader, IG Index.

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