- FTSE 100 continues to move at odds with US peers.
- UK consumer confidence at its highest level in a year.
- Tech weakness continues in the US, but now’s not the time to panic.
- Oil on track for weekly gain.
Matt Britzman, senior equity analyst, Hargreaves Lansdown:
“The FTSE 100 notched its third consecutive record close yesterday, edging up 0.2% as healthcare and mining stocks led the charge. A strong UK manufacturing PMI print added to the upbeat tone, signalling the best month for services in a year. The early US trade deal and relatively inexpensive valuation for UK companies relative to global peers have made for an attractive backdrop for UK stocks that have performed well all year. Futures suggest a flat open this morning as traders pause for breath ahead of US Fed Chair Powell’s Jackson Hole speech later today.
On the macro front, UK consumer confidence ticked up to -17 in August – the highest in a year – helped by the Bank of England’s recent rate cut, though lingering worries over inflation and jobs are keeping optimism in check.
Across the pond, a frothy mix of stretched valuations and uncertainty over the Fed’s next move is proving a volatile cocktail. Tech weakness led the retreat as investors rotated out of high-flyers and into defensives, and the S&P 500 lost another 0.4%. But this isn’t the time to panic – long-term investors should look past the noise and focus on the generational tech revolution underway. Future point to another soft open later today, but markets rarely move in straight lines; pullbacks are healthy, and the long-term outlook for the AI trade remains compelling.
Brent crude oil is holding above $67 a barrel, on track for its first weekly gain in three, as hopes for a swift Russia-Ukraine peace deal fade. Geopolitical tensions, fresh US tariffs on India, and the biggest US inventory draw since mid-June are all lending support.”
