Last night’s Wall Street rally provides ‘port in the storm’ for FTSE 100

“It has been a turbulent week as the sceptre of inflation once again spooked investors however it looks like last night’s Wall Street rally is providing a port in a storm for the FTSE 100 as it enjoyed a solid bounce on Friday morning,” says AJ Bell investment director Russ Mould.

The FTSE 100, two hours into Friday’s session, finds itself up 0.72% to 7,013.20.

The big economic update coming later today is the US retail sales release.

“We’re operating in a through the looking glass world where seemingly bad news is taken positively by the markets on the basis it means central banks won’t pull back on the stimulus front or put up rates,” Mould said.

“If retail sales have surged across the Atlantic then that would likely be a headwind for equities as it would stoke the concern about rising prices and what the US Federal Reserve might need to do to keep them under control.”

Keeping cases of the Indian variant of Covid-19 under control is the something the UK is facing up to and it is prompting some concern that the next phase of reopening might be delayed. “This uncertainty could hit the hospitality and travel sectors,” Mould reckons.

FTSE 100 Top Movers

Sage (3.11%), SSE (2.44%) and BT Group (2.44%) are the biggest risers on the FTSE 100 midway through the morning session on Friday.

At the other end, thanks to a drop-off in the price of copper, miners Antofagasta (-2.13%) and Rio Tinto (-1.84%), as well as Rolls-Royce (-1.45%) are the biggest fallers.