Person voting in UK election
Polls have seen Keir Starmer’s Labour party take the lead as the Conservatives slip / Image source: Adobe

Stock prices were in the green on Wednesday morning amid optimism that the Federal Reserve in the US might cut interest rates in the future.

In the UK, it is the day before election day. Polls have seen Keir Starmer’s Labour party take the lead as the Conservatives slip.

The FTSE 100 index opened up 42.55 points, 0.5%, at 8,163.75. The FTSE 250 was up 99.58 points, 0.5%, at 20,294.05, and the AIM All-Share was up 4.22 points, 0.6%, at 768.59.

The Cboe UK 100 was up 0.6% at 812.56, the Cboe UK 250 was up 0.5% at 17,657.29, and the Cboe Small Companies was up marginally at 16,918.39.

In European equities on Wednesday, the CAC 40 in Paris was up 0.6%, while the DAX 40 in Frankfurt was up 0.7%.

In London, all eyes are on the UK election. Brits will head to polling stations up and down the country on Thursday.

The UK Labour party is 99% ‘certain’ to secure more seats in Thursday’s general election than when it won a landslide victory in 1997, a major new poll said.

The centre-left opposition party – out of power since 2010 – is predicted to claim 484 out of a total of 650 seats in what would be an unprecedented victory in modern British history, pollster Survation said.

Meanwhile, the right-wing ruling Conservatives and the centrist Liberal Democrats are in a close race to come a distant second and form the country’s official opposition, it added.

In the US on Tuesday, Wall Street ended higher, with the Dow Jones Industrial Average up 0.4%, the S&P 500 up 0.6% and the Nasdaq Composite up 0.8%.

Shares got a boost, after US Federal Reserve Chair Jerome Powell said the US central bank has made ‘quite a bit of progress’ in its fight against stubborn inflation.

‘We’ve made quite a bit of progress in bringing inflation back down to our target, while the labor market has remained strong and growth has continued,’ Powell told an event in Sintra, Portugal, which was streamed online.

He added that it was possible the Fed could hit its two percent target ‘maybe late next year,’ or in 2026. ‘The main thing is, we’re making real progress,’ he said.

The pound was quoted at $1.2697 early on Wednesday in London, higher compared to $1.2678 at the equities close on Tuesday. The euro stood at $1.0758, higher against $1.0735. Against the yen, the dollar was trading at JP¥161.86, up compared to JP¥161.54.

Back in London, miners were trading at the top of the FTSE 100 index early Wednesday, on the back of some data from China. China is a major buyer of minerals. Fresnillo, Antofagasta, and Rio Tinto were up 2.9%, 2.6%, and 2.3%, respectively.

China’s service economy continued to expand into the end of the second quarter of 2024, supported by rising new and export business, purchasing managers’ index readings from S&P Global showed on Wednesday.

The seasonally adjusted headline Caixin China services business activity index posted 51.2 in June, down from 54.0 in May. According to FXStreet, the PMI data was expected to cool to just 53.4 points.

Wednesday’s data signalled an expansion in activity for an eighteenth consecutive month, albeit at the slowest pace since October 2023.

On London’s AIM, ECR Minerals jumped 30%.

The gold exploration company announce the latest results for additional testing for the critical mineral Antimony from diamond core previously drilled at Bailieston, Central Victoria, Australia.

‘We’ve identified a highly promising opportunity at Bailieston that warrants further follow-up. The discovery of 32% Antimony over an intersection of 0.3m, coupled with multiple other highly anomalous results, marks a significant breakthrough and validates our decision to re- submit these samples for further analysis,’ said Chief Operating Officer Mike Whitlow.

‘The finding is truly remarkable, especially considering the current surge of interest and demand for the critical mineral.’

In Asia on Wednesday, the Nikkei 225 index in Tokyo was up 1.3%. In China, the Shanghai Composite was down 0.5%, while the Hang Seng index in Hong Kong was up 1.2%. The S&P/ASX 200 in Sydney closed up 0.3%

Brent oil was quoted at $86.65 a barrel early in London on Wednesday, down from $86.99 late Tuesday.

Gold was quoted at $2,341.10 an ounce, higher against $2,327.03.

Still to come on Wednesday’s economic calendar, there is a slew of PMI data from Germany, the eurozone and the UK.

There is also the release of the weekly US jobless data at 1330 BST, before markets in New York close early ahead of US Independence Day on Thursday.

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Issue Date: 03 Jul 2024