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FTSE holds steady ahead of EU summit

It was evident that investors were cautious ahead of today’s EU heads-of-state summit; the much anticipated meeting ensured that the volume of trades on the FTSE100 was a mere 20% of its 90-day average. It will not be until tomorrow that markets deliver their interpretation of the developments (or lack thereof), with an announcement expected to be made around 8 o’clock this evening.

With the FTSE trading tentatively into positive territory, sentiment was boosted around lunchtime as some bullish economic data came out from across the Atlantic. US durable goods orders were up 1.7% month on month, ahead of the 0.5% that was anticipated, and new home sales for September came in ahead of expectations at an annualised rate of 313,000.

At a stock specific level Deutsche Bank downgraded Next form a buy to a hold, and although they suggested the shares look good value in absolute terms, they outlined concerns that there may be limited upside form here considering the company’s strong recent performance (the second best performer in the FTSE 100 year to date and up 23% since August). The broker also suggested that unseasonably warm autumn weather (they clearly haven’t been to Newcastle) may lead to a slower than expected start to the retailer’s autumn and winters ranges. The shares lost 2.1% to finish down at 2557p.

Gold’s approximate 2% gain, pushing the precious metal back up over $1700 per ounce, highlighted that political concerns were still dictating markets. The FTSE 100 managed to finish the day up 28 points (0.5%) at 5553.

This was posted in Bdaily's Members' News section by John Dance .