The FTSE 100 traded sideways in a tight range on Wednesday as investors awaited the next major catalyst for equities.
The new US president has dominated trade since his inauguration but has been fairly quiet over the past few days, leaving traders at a loss as to what to expect next.
US economic data due for release on Wednesday could well provide an impetus for a move in equities, but until then, investors are seemingly happy to hold back on taking macro-driven positions.
“There’s an overarching sense of calm in the air, perhaps a little unnerving given the storm of political drama we’ve become accustomed too since Tump took office,” said Matt Britzman, senior equity analyst, Hargreaves Lansdown.
“The FTSE 100 opened flat this morning, and after posting another record high yesterday it’s still riding on a wave of enthusiasm. US inflation data has scope to upset the apple cart later today, but for now at least, it’s robust company earnings that are driving markets forward.”
The latest set of upbeat earnings came from Barratt Redrow, who said they see earnings coming in at the top end of the range as completions rose.
“Housebuilder Barratt is reaping the rewards of a more stable economy and political landscape, with customer demand bouncing back and strong reservations since January,” Britzman explained.
“As a result, Barratt is now targeting the upper end of its profit expectations for the year which, when combined with good execution over the first half, should go down well with investors. Following the acquisition of Redrow, Barratt’s capital plans are in the spotlight, with the company poised to launch a £100mn annual buyback, leveraging improved cash flow and a robust capital position.”
Barratt Redrow shares were 5% at the time of writing.
Prudential was the top riser after it said it was considering selling shares in its Indian ICICI Prudential Asset Management business and would return the cash to investors. Prudential was 6% to the good around midday on Wednesday.