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Reports UK

UK stock market commentary (April 11, 2014)

April 11, 2014, Friday, 05:37 GMT | 00:37 EST | 09:07 IST | 11:37 SGT
Contributed by Capital Spreads

European equities are set to open lower tracking overnight declines in the US. There was no news catalyst for such a sell off and the market action was orderly, steady and sustained. Not the kind of flash in the pan knee jerk reaction you see to a headline or economic data release, but more symptomatic of the big money deciding that this point in the market cycle is a good place to liquidate. The question on traders’ minds at the moment is how much more downside have we to come?

The euro continued its rally against the greenback as Germany, Europe’s biggest economy appeared ready for some easing concessions ahead of Chancellor Merkel’s trip to Greece. Thus, the EUR/USD pair rose for 4 days in a row, gaining 34 pips to 1.3887 and at the time of writing is still on the offence.

The US Energy Information Administration announced yesterday in its annual Oil Reserves report that US proved reserves are at the highest levels in 36 years. At the same time, Libya said one of the four ports seized by rebels is due to reopen. However, the WTI crude prices went nowhere closing flat at $103.40 a barrel.

Ongoing tensions in Ukraine supported gold prices which extended their recent rebound to $1318.2, a $6.4 gain for the day. The minutes of Fed’s March meeting revealed doubts over the previous projections on interest rate rise which also supported the precious metal.