Home Business NewsBusiness FTSE up despite more US selling overnight as Fed meeting looms

FTSE up despite more US selling overnight as Fed meeting looms

by LLB Reporter
26th Jan 22 11:39 am

The FTSE 100 bounced back sharply on Wednesday, bucking the negative trend set in the US last night and some mixed trading in Asia.

With today’s US Federal Reserve meeting firmly in view the UK’s flagship stock index has become somewhat dislocated from other global benchmarks thanks to the absence of big technology companies in its ranks.

“For years this under-representation for tech held the FTSE 100 back, now the dominance of relatively cheap tobacco, resources and banking stocks is playing in its favour. For the year to date it is up slightly while the Nasdaq in the US is down double digits,” says AJ Bell investment director Russ Mould.

“How long this trend continues remains to be seen. The Fed’s update comes with the first US rate hike, perhaps of four or five this year, expected in March.

“It remains to be seen if its members will do anything to calm the recent volatility in the markets, particularly given the current tensions between Russia and the Ukraine.

“While its primary job is to keep a lid on inflation, the Fed has shown a willingness in the past to consider the market response when determining its policy.”

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