The FTSE 100 is expected to add a few points at the start of Wednesday’s session as investors await the latest batch of inflation data for the UK.
Spread-betters IG expect the blue-chip index to open up around 4 points after ending Tuesday’s session down 140 points at 6,859.
The market seems to be struggling to recover from its recent sell-off as investors consider whether the post-pandemic economic recovery will be as smooth as initially expected amid surges in cases in multiple countries and the increased fear of new variants potentially upending vaccine efforts.
The downward trend was evident on Wall Street overnight, with the Dow Jones Industrial Average closing 0.75% lower at 33,821, while the S&P 500 dropped 0.68% to 4,134 and the Nasdaq fell 0.92% to 13,786.
It was a similar picture in Asia this morning, with Japan’s Nikkei 225 down 1.99% while Hong Kong’s Hang Seng dropped 1.84%.
Meanwhile, the latest UK inflation data will give investors some clarity on whether to expect a sharp rise in inflationary pressures in the coming months as the British economy recovers from lockdown.
This could mean more rises from UK bond yields, which in turn will provide additional downward pressure on equities.
On currency markets, the pound was down 0.07% against the dollar at US$1.392, although the inflation data later could provide some catalysts for movement.
Around the markets:
Sterling: US$1.392, down 0.08%
Brent crude: US$66.09 a barrel, down 0.72%
Gold: US$1,783 an ounce, up 0.72%
Bitcoin: US$55,593, up 0.71%
6.50am: Early Markets – Asia / Australia
Stocks in the Asia-Pacific region were mostly lower on Wednesday as the World Health Organization warned that the COVID-19 global infection rate is approaching its highest level ever.
The Hang Seng index in Hong Kong fell 1.66% while the Shanghai Composite in China gained 0.10%.
In Japan, the Nikkei 225 slipped 1.96% and South Korea’s Kospi dipped 1.45%.
Shares in Australia fell, with the S&P/ASX 200 trading 0.59% lower.
Proactive Australia news:
Antipa Minerals Ltd (ASX:AZY) has received binding commitments for a non-underwritten placement to raise $22 million and will undertake a share purchase plan (SPP) of up to $3 million, resulting in a total capital raising of up to $25 million.
Alta Zinc Ltd (ASX:AZI) (FRA:8EE) continues to be encouraged by exploration at Gorno Project in northern Italy with multiple high-grade zinc and lead intersections, along with silver, received from drilling the Ponente area of the Gorno Mine.
Musgrave Minerals Ltd (ASX:MGV) (OTCMKTS:MGVMF) (FRA:6MU) has received further strong results at its flagship Cue Gold Project in Western Australia with regional aircore drilling at Target 14 within the new gold corridor west of Lena returning up to 12 metres at 8.7 g/t from 66 metres.
Matador Mining Ltd (ASX:MZZ) (OTCMKTS:MZZMF) (FRA:7MR) has generated multiple new priority geophysical gold targets near the Window Glass Hill (WGH) deposit within the Cape Ray Gold Project in Newfoundland, Canada.
EcoGraf Ltd’s (ASX:EGR) proposed Kwinana Battery Anode Materials Facility has been granted major project status, which recognises the importance of the development and supports the Australian Government’s Critical Minerals Strategy and Western Australia’s Future Battery Industry Strategy.