FTSE stays on top with Boris Johnson committed to avoiding second lockdown

The FTSE 100 led the European equities rally for a second consecutive day on on Wednesday, following the public address by Boris Johnson the previous evening, in which the prime minister reiterated his reluctance to implement a second lockdown.

With promises to “keep the economy open” and “wrap [his] arms around workers and industries”, the FTSE was sufficiently comforted to manage a 1.20% rally, at one point touching 5,972 before settling back down to 5,899 points.

Following close behind, with more modest rallies, were the FTSE’s Eurozone equities cousins. Recovering from a couple of days of acute Covid fears, the CAC rallied by 0.62%, to 4,802, while the DAX nigh-on mirrored its Tuesday performance, up 0.39%, to 12,642 points.

A real talking point in global equities, though, was the opening of the Dow Jones during the afternoon, which saw the audacious early gains in European markets somewhat taper off. The reason for this was a 1.36% decline by the Dow Jones, taking it to another, renewed, seven-week nadir of 26,916 points.

This level, well shy of the 28,000 point level it spent much of its time before the pandemic and during the summer, is unlikely to be bettered until big tech reticence, and pre-election jitters, fade.

Asian equities were largely flat as they closed for the day, with Shanghai’s SSE Composite up by a modest 0.17%, to 3,279 points; Hong Kong’s Hang Seng rising 0.11%, to 23,742; and Japan’s TOPIX falling 0.13%, to 1,644 points.

Speaking on the FTSE reaction to disappointing PMI data, and the possibility for further Covid restrictions to be implemented, Spreadex Financial Analyst, Connor Campbell, stated:

“This also meant the FTSE was fine with shaking off some disappointing flash PMIs. The manufacturing reading fell from 55.2 to 54.3, while the services sector suffered a sharper than forecast drop from an ‘Eat Out to Help Out’-boosted 58.8 to 55.1. That latter reading, however, puts it well above the 47.6 seen for the Eurozone as a whole.”

“It is worth remembering that, as Dominic Raab conceded, the measures announced in the last few days are by no means a ‘silver bullet’ when it comes to seeing off – or mitigating – a second wave, and further restrictions could still be implemented, especially with the UK’s current daily case figures.”

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Senior Journalist at the UK Investor Magazine. Also a contributing writer at the Investment Observer, UK Property Journal and UK Startup Magazine. Postgraduate of King's College London with a specialisation in Business Ethics. Interested in Development Economics and David Hume.