Following the delivery of the Autumn Statement by Chancellor George Osborne, the London equity benchmark index came under pressure posting modest declines towards 6,700. Osborne’s statement mentioned “higher growth, lower unemployment and falling inflation”. The UK Chancellor revealed that the forecast for the economy being presented demonstrates the UK to be “the fastest growing of any major advanced economy in the world”. However, he warned that the deficit remains “too high”, reporting measures to “tighten the public finances a little” in order to decrease the UK’s debt.
Following the Autumn Statement announcement, sterling rallied against the USD and broke above the 1.57 level. We also received fairly robust UK Markit/CIPS services PMI data which climbed to 58.6 in November from 56.2 in October beating analysts’ expectations.
European equity markets edged higher in today’s session, despite the modest economic data. Markit services PMI data was fairly tepid in France and Germany, while the Eurozone’s services PMI fell slightly to 51.1 in November compared to 51.3 in October, missing expectations.
Crude oil prices rebounded from yesterday’s losses and climbed higher with Brent front month futures gaining above $71 per barrel while WTI front month futures retested $67.50. Gold and silver continued their recent strong upside momentum, while base metal prices remained in negative territory following the tepid Chinese Markit PMI services data.