Stocks set to edge higher after G20 finance pact
The opening call this morning is for stock markets to trade higher following news at the weekend of an agreement being reached between the G20 finance ministers at their meeting in Seoul, to refrain from the “competitive devaluation” of their currencies.
GFT is quoting the FTSE 100 index to open up 20 points from Friday’s close, at a level of 5,761. The German DAX 40 is expected to open up 24 points at 6,629, and the French CAC 40 index is forecast to open up 18 points at 3,886.
Shares dipped back from a six-month high on Friday amidst apprehension ahead of the currency talks.
Despite the lack of any concrete targets being announced regarding pledged reductions of current account imbalances, the markets will likely still get a boost from the news, broadly viewing the consensus as a substantial step in defusing mounting tensions and averting looming trade wars.
One surprise development was the agreement reached to reform the IMF’s structure, a deal which will give a bigger voice to Brazil, Russia, India and China.
From this bullish base traders will be looking to earnings out this the week from some big-name UK blue chips, including AstraZeneca, Royal Dutch Shell and British Airways. Strong, expectation-beating third quarter numbers similar to those we have seen in the US will be hoped for.
Martin Slaney is director of global dealing operations at GFT.