The FTSE 100 made a steady start on Friday, putting it on course for a solid if unspectacular weekly gain which was just what the doctor ordered after a very up and then very down January, says AJ Bell investment director Russ Mould.
“The markets may well be keeping their powder dry ahead of the US jobs report later with hopes of a vaccine-induced recovery balanced against evidence of the impact Covid continues to have on the economy with German factory orders down sharply.
“The FTSE itself was somewhat constrained by strength in sterling as the Bank of England indicated yesterday that negative rates were unlikely (and wouldn’t be introduced for at least six months in any case) and predicted a big bounce back in UK GDP.
“When the pound rises it hits the relative value of the overseas earnings which dominate the index. Oil prices remained strong, with Brent crude on the cusp of achieving the $60 per barrel level for the first time since the pandemic hit on a tight supply picture.”