Shares in Asia are broadly higher this morning after moderate gains on Wall Street yesterday. The Nikkei225 is 128 points higher as I write whilst the Hang Seng has currently gained 256 points. Gains though are being reduced from earlier highs as we approach the closing bell.
Gains on wall Street yesterday of 38 points came about largely on the hint of a rate cut after the much awaited FED meeting. Jerome Powell and the FOMC left themselves plenty of wriggle room to provide the rate cut that the markets are really waiting on but it was only a hint. The FED removed ‘patient’ from their report and indicated that they will ‘act as appropriate’,
The Conservative party leadership battle will be whittled down to the final two candidates today. Sterling is back trading above 1.2700 this morning, more so of the rate cate scenario in the US but the increasing clarity can only help the currency.
GOLD has traded through levels last seen in August 2016 and many would suggest that we are looking at a genuine breakout above those levels. GOLD has traded from 1319 to 1385 since last Monday, it has been a big move and I expect it to run out of steam at the current levels.