Federal Reserve lowers Interest Rates By 0.25%, its first in a decade

Global Markets: Stocks in the United States were hovering lower with S&P 500 index was down by 23.93 points or 0.79% in day’s session and quoting at 2,989.25, the Dow Jones Industrial Average Index decreased by 259.17 points or 0.95% and quoting at 26,938.85 and the technology benchmark index Nasdaq Composite contracted by 63.61 points or 0.77% and trading at 8,210.01 respectively, at the time of writing.

Global News: To support the domestic economy amid slowing economic growth, the US Federal Reserve cuts interest rates for the first time since 2008 by 25 basis points (0.25%). Core personal consumption expenditure came in at 1.7%, well below the central bank’s target of 2%. The US and Chinese negotiators ended their meetings ahead of schedule, describing the talks as constructive and agreed to reconvene in September. Employment cost index rose by 0.6 per cent in the second quarter and wages rose by 0.7 per cent, as labour costs rose at the slowest pace in 1-1/2 years in the second quarter.

European Markets: The London’s broader equity index FTSE 100 ended 59.99 points or 0.79% lower at 7,586.78, the FTSE 250 Index slumped 108.30 points or 0.55% in today’s session and ended at 19,666.52 and the FTSE All-Share Index fell off 30.66 points or 0.74% against the previous close and ended day’s session at 4,134.03 respectively. Another, European equity benchmark index STOXX increased by 0.66 points or 0.17% in day’s session and ended the market session at 385.77.

European News: In a bid to solve the issue of the Irish border that has been a major reason behind the stalemate, Prime Minister Boris Johnson met allies in Northern Ireland on Wednesday. After four days of decline that took the sterling to its lowest level in 2-1/2 years, the currency enjoyed some respite on Wednesday and bounced back above $1.22. With more weakness likely in case of increased probability of no-deal Brexit, market experts see the rebound as temporary. As carmakers see no-deal exit as the worst possible option, investment in the industry declined by over 70 per cent, falling to £90m in the first half.

London Stock Exchange (LSE)

Top Performers Stocks: TCG (THOMAS COOK GROUP PLC), CCC (COMPUTACENTER PLC), and NXT (NEXT PLC) rose by 24.42 per cent, 12.13 per cent and 7.98 per cent respectively.

Top Laggards Stocks: INTU (INTU PROPERTIES PLC), KIE (KIER GROUP PLC), and AML (ASTON MARTIN LAGONDA GLOBAL HOLDING) reduced by 31.90 per cent, 16.69 per cent and 12.32 per cent respectively.

FTSE 100 Index

FTSE100 Index Chart: 5-days Price Performance (as on July-31-2019), after the market closed. (Source: Thomson Reuters)

Top Risers Stocks: NXT (NEXT PLC), RTO (RENTOKIL INITIAL PLC) and CNA (CENTRICA PLC), and rose by 7.98 per cent, 5.53 per cent and 3.40 per cent respectively

Top Fallers Stocks: TW. (TAYLOR WIMPEY PLC), FRES (FRESNILLO PLC), and STJ (ST. JAMES’S PLACE PLC) reduced by 8.35 per cent, 8.05 per cent and 5.66 per cent respectively.

Top Three Active Volume Stocks: LLOYDS BANKING GROUP PLC, VODAFONE GROUP PLC, and BARCLAYS PLC.

Top Fallers Sectors: Financials (-1.30%), Healthcare (-1.15%) and Consumer Non-Cyclicals (-0.89%).

Foreign Exchange and Fixed Income

FX Rates*: GBP/USD and EUR/GBP were trading at 1.2165 and 0.9113 respectively.

10-Year Bond Yields*: US 10Y Treasury and UK 10Y Bond yields were exchanging at 2.013% and 0.604% respectively. 

*At the time of writing

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