CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 69% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.
Open account
☰
CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 69% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.
Open account
✖

European markets reverse early gains BoE decision eyed

Article By: ,  Financial Analyst
May 10, 2011 4:37 PM

European markets saw early gains reverse as the morning progressed, with investors continuing to exert short term trading habits and lower the amount of risky assets they hold in their portfolios.

The FTSE 100 lost 0.5% by late morning trade, with the miners and financial leading the falls lower, alongside tobacco stocks.

Naturally, however, there were strong eyes cast on the Bank of England interest rate and asset purchase levels decision at 12 noon, and this kept investment flows low for much of the morning session. Whilst no movement is expected on either rates or QE levels, there is a faint chance that the Central Bank could increase asset purchases to help ensure the technical recession which the UK has just entered remains a temporary one.

However, given that inflationary indicators are now slightly worse than expected, this may force the BoE to refrain from acting in this month’s decision. That said, the Bank has surprised before and so traders are slightly hesitant this morning until we see the decision.

UK Industrial Production fell 0.3% in March, as expected, from a previous rate of 0.4% growth. UK manufacturing production, however, surprised to the upside by bouncing back much more vigorously from a fall of 1.1% in February to grow at +0.9%, bearing expectations of 0.5%.

Whilst stocks saw a temporary lift from the release of UK industrial and manufacturing production figures, the lift lasted only a mere 15 minutes until weakness compiled to force the FTSE 100 to trade briefly back below the 5500 level.

All eyes on the Bank of England decision at 12 noon.

StoneX Financial Ltd (trading as “City Index”) is an execution-only service provider. This material, whether or not it states any opinions, is for general information purposes only and it does not take into account your personal circumstances or objectives. This material has been prepared using the thoughts and opinions of the author and these may change. However, City Index does not plan to provide further updates to any material once published and it is not under any obligation to keep this material up to date. This material is short term in nature and may only relate to facts and circumstances existing at a specific time or day. Nothing in this material is (or should be considered to be) financial, investment, legal, tax or other advice and no reliance should be placed on it.

No opinion given in this material constitutes a recommendation by City Index or the author that any particular investment, security, transaction or investment strategy is suitable for any specific person. The material has not been prepared in accordance with legal requirements designed to promote the independence of investment research. Although City Index is not specifically prevented from dealing before providing this material, City Index does not seek to take advantage of the material prior to its dissemination. This material is not intended for distribution to, or use by, any person in any country or jurisdiction where such distribution or use would be contrary to local law or regulation.

For further details see our full non-independent research disclaimer and quarterly summary.

CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 69% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money. CFD and Forex Trading are leveraged products and your capital is at risk. They may not be suitable for everyone. Please ensure you fully understand the risks involved by reading our full risk warning.

City Index is a trading name of StoneX Financial Ltd. Head and Registered Office: 1st Floor, Moor House, 120 London Wall, London, EC2Y 5ET. StoneX Financial Ltd is a company registered in England and Wales, number: 05616586. Authorised and regulated by the Financial Conduct Authority. FCA Register Number: 446717.

City Index is a trademark of StoneX Financial Ltd.

The information on this website is not targeted at the general public of any particular country. It is not intended for distribution to residents in any country where such distribution or use would contravene any local law or regulatory requirement.

© City Index 2024