Dow Jones drops, despite rising consumer sentiment
Indices in the United States were lower on Friday, despite the latest consumer sentiment figures from the world’s largest economy showing growth.
Figures from the University of Michigan’s Consumer Sentiment Index showed a reading of 86.4 in June thus far.
This is up from May’s final reading of 82.9. And better than the market’s expectation of 84 in the month so far.
Director of the survey Richard Curtain stated that. “Stronger growth in the national economy was anticipated. With an all-time record number of consumers anticipating a net decline in unemployment”.
Jobless claims dropped for the sixth consecutive week yesterday. With many expecting a blockbuster rise in Non-farm payrolls for June in upcoming weeks.
Despite this, both the Dow Jones and S&P 500 traded lower.
British GDP data sends FTSE 100 to 1-month high
As the G-7 summit continued today in the United Kingdom, GDP data was also released. Showing positive signs for the British economy.
Data from the Office for National Statistics highlighted growth within the UK in April. As non-essential businesses got permission to re-open their doors.
The figures showed that gross output rose by 2.3% from March to April, which is the fastest growth since July last year, beating expectations of an 2.2% increase as a result.
The British government received Friday’s data well, with Finance Minister Rishi Sunak stating that. “Today’s figures are a promising sign that our economy is beginning to recover“.
This follows on from the Bank of England last month raising its forecast for the UK economy to grow by 7.25% from an earlier estimate of 5.0%.
London’s FTSE 100 closed up 0.65% rising for the second consecutive day on the news.
Oil prices higher as EIA gives supply warning
The rally in oil continued full steam ahead on Friday, as prices of the energy climbed to their highest levels since 2018.
Although this feat was already reached earlier on in the week. Today’s move saw prices eclipse that of those seen a few days prior.
WTI crude oil rose to an intraday high of $71.22, which is the highest price crude has traded since 2018.
This move came as the Energy Information Administration stated that, “OPEC+ needs to open the taps to keep the world oil markets adequately supplied”.
As the world continues vaccination. The EIA believes that demand has overtaken supply, even after OPEC+ recently increased output to 2.1 million barrels per day.
Quote of the day – “The market is a device for transferring money from the impatient to the patient.”– Warren Buffet
Senior Market Analyst