Home Business NewsBusiness FTSE up as China cuts mortgage rate

FTSE up as China cuts mortgage rate

by LLB Reporter
20th Jan 22 11:39 am

The FTSE 100 started Thursday on the front foot as the Chinese central bank continued to buck global trends by cutting a key mortgage rate, says AJ Bell investment director Russ Mould.

“China has often found itself at odds with the rest of the world economically over the last two years, perhaps unsurprisingly given it was the first country to be hit by the Covid-19 pandemic.

“And its efforts to revive a struggling property sector by relaxing monetary policy, at a time when the likes of the Bank of England and Federal Reserve are in rate-hiking mode, should probably be seen in this context.

“Mining stocks and Burberry, which has substantial exposure to China, got a lift off the back of the news.

“Takeaway platform Deliveroo, which has endured a troubled start to life as a public company in the wake of a disastrous IPO last March, announced strong fourth quarter sales growth.

“The effective lockdown conditions created by Omicron undoubtedly helped but with restrictions starting to be lifted, this supportive trend is rapidly moving into the rear-view mirror.

“Already dealing with the pressures of an extremely competitive market, Deliveroo now faces the prospect of a cost of living squeeze which may weaken appetite for ordering takeaways on such a regular basis.

“Julian Dunkerton’s rescue mission at faux-Japanese fashion retailer Superdry is enjoying some success as the company benefited from sales growth and crucially offered fewer discounts. Dunkerton also seems to be kicking the online operation into shape, helping to boost profitability in that part of the business.

“Later today, US streaming platform Netflix is set to report its fourth quarter earnings. Microsoft’s big move for gaming firm Activision Blizzard should put the spotlight on Netfix’s own ambitions in this space as the lines between different forms of screen-based entertainment get increasingly blurred.”

Leave a Commment

CLOSE AD

Sign up to our daily news alerts

[ms-form id=1]