Week Ahead

Plan your strategies for the trading week ahead with key insights from our team.

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Week Ahead: UK Election & the ECB

Welcome to LCG’s look ahead to the key events in markets for the week starting June 5th, 2017.

It could be a game-changing week for the UK with the general election taking place on Thursday. 24hr forex markets will be the first to react with the full market reaction on Friday. The Conservatives are expected to swoop to victory despite a fairly calamitous campaign that contrasted with an ambitious effort from Jeremy Corbyn’s Labour. The FTSE 100 struck 7,600 for the first time last week so investors are to some-extent pricing in the event- which could mean a big shock if it’s a hung parliament or Labour win.

 

Election aside, confidence has been global with all US indices hitting record highs again last week. In FX, the US dollar has been reasserting itself after some decent jobs data which increases the chances of two more rate hikes this year. Based on the rehotic of Mario Draghi and other ECB members in speeches, the ECB is unlikely to change policy on Thursday- markets may have to wait longer for the first hint of tapering. The Strength in the dollar and a contraction in the Chinese manufacturing sector have been hurting commodities including gold, silver and oil.