MARKET WRAP: FTSE 100 rallies, USD higher as US markets closed

imageEconomy8 hours ago (Sep 06, 2021 16:35)

© Reuters.

Key Points

  • FTSE 100 closing price of 7,188.3, +0.7%
  • Shares rally on hopes Fed taper delayed
  • USD rebounds
  • Oil steady in quiet trade with US markets closed
  • Bitcoin breaks resistance, trades above $52,000

By Samuel Indyk – The FTSE 100 traded higher on Monday, alongside other major European bourses, on hopes that Fed tapering will be delayed following last week’s nonfarm payrolls report. The weaker than forecast headline should rule out the Fed winding down bond buying at this month’s meeting.

There was a lack of corporate news, particularly with US markets closed for the Labor Day holiday. One story that did get some attention was news that Goldman Sachs (NYSE:GS) plans to float its Petershill Partners unit in London, valuing the subsidiary at over $5 billion. Goldman plans sell around $750 million of new shares, as well as existing ones, in the IPO.

The USD edged higher on Monday, retracing some of the losses from last week when the US Dollar Index fell on every trading day.

“As it is almost anybody’s guess, which way the Fed will choose to interpret weak job creation, the impact on the dollar from expectations to future Fed policy will be a coin toss in the near term,” wrote Danske Bank analysts in an emailed note. “There is a real risk Fed may wish to sound a tad more dovish until jobs accelerate again but it may also choose to look through ‘noise’.”

The stronger USD weighed on GBP/USD although ranges were relatively small with US participants away from their desks.

WTI and Brent crude futures were marginally lower in the wake of Saudi Arabia cutting their crude selling prices to Asia. The price cut was more than expected and may indicate weaker oil demand as the Delta variant continues to wreak havoc in the region.

Cryptocurrencies were mixed with Bitcoin trading at its highest level since 12th May after breaking above key resistance. Ethereum struggled to maintain momentum after breaking above $4,000 on Friday and currently trades below the key figure.


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MARKET WRAP: FTSE 100 rallies, USD higher as US markets closed

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