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
✖

Miners drag FTSE lower as US Sino trade tensions resurface

Article By: ,  Senior Market Analyst
November 27, 2018 11:17 AM
The optimistic start to the week was short lived and global equities resumed the downwards trajectory on Tuesday. The FTSE, grinded lower across the session, weighed down by weaker miners as metal prices took a hit from rising trade tensions. Thomas Cook and house builders were also standout decliners. The weaker pound gave a boost to the multinationals on the FTSE which benefit from a more favourable exchange rate.

As we head towards the G20 meeting at the end of the week in Buenos Aires, trade tensions between US and China were always going to be a central focus. However, traders had been hoping that we would have seen an improved tone between the two powers by now. The fact that Trump remains adamant that tariffs on Chinese goods will increase to 25% indicates that the talks are no further along. Any market optimism of easing trade tensions is misplaced. This is not a passing theme and is one that the market will need to accept is here to stay at least for the medium term. If little progress has been made so far, it is difficult to see what will change over the coming months.
Base metal prices, which are particularly sensitive to developments in China, were trading lower, dragging the heavyweight miners’ southwards. 

Brexit uncertainty weighs on sterling
The pound is on the decline as Brexit uncertainty is proving too much for pound traders to stomach. Sterling extended losses for a fourth consecutive day, dropping 0.7% versus the dollar. Theresa May continues to try to drum up support for the Brexit plan, ploughing stubbornly on, even as Trump suggests that the deal in its current state could prevent a trade deal being done with the US. 

The 11th December has been set for the vote in Parliament on Brexit. It almost goes without saying that the pound will be under significant pressure until then, as traders try to position for a highly unpredictable event.

Dollar strong as US consumer confidence remains solid
Whilst the pound was suffering from Brexit uncertainty, the dollar charged higher as US consumer confidence came in on target. US consumer confidence ticked down from its 18 year high of 137.9 in October, to 135.9 in November. Confidence in the US remains high thanks to low unemployment a strong jobs market, low inflation and low interest rates. However, concerns over the Fed’s hiking plans has just taken the edge off spirits, pulling the consumer index marginally lower. 


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