Markets edgy as traders await key decisions in UK and US
Most indices hold steady before UK election, Fed monetary policy announcement and tariff decision
Investors enjoyed the calm before the storm on Wednesday as markets awaited three significant decisions.
US shares had a steady opening as traders waited for news from the US Federal Reserve’s final monetary policy meeting of the year. The Fed has cut interest rates three times in 2019, but on this occasion it left rates unchanged.
Nevertheless, markets will watch its rates forecast and economic projections closely. The Dow Jones traded slightly down in the morning, hit by losses in Boeing and Home Depot, while the Nasdaq was up 0.26 per cent.
Asian markets closed after a day of steady trading, with Hong Kong’s Hang Seng index up 0.79 per cent. Most major Asian indices enjoyed modest gains after latching on to hints that Donald Trump may delay the imposition of the next set of Chinese trade tariffs, due on Sunday, December 15. No final decision has been taken.
European and UK indices were also calm ahead of the UK general election, with the final polls predicting a narrow victory for Boris Johnson’s Conservative Party.
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But traders will wait nervously for Thursday's result, which could create new certainty around Brexit or lead to further confusion.
On the final day of trading before the election, London’s FTSE finished virtually unchanged on 7216.25, 0.035 per cent up. The German DAX was up 76.02 (0.58 per cent) on the day at 13,146.74. Sterling brushed off election fears and was up against the dollar and the euro.
While shares remained largely unchanged, Gold prices were up about 0.5 per cent by mid afternoon. Gold is seen as a safe haven in uncertain times, and its rising fortunes suggest a nervousness among investors. The next few days will show how justified their fears may be.
FURTHER READING: Investor uncertainty as UK braced for hung parliament