Talking Points
- FTSE 100 unable to keep a hold on the 7,400 level.
- Russian stocks shed gains amid Syria tension.
- See the DailyFX Economic Calendar and see what live coverage for key event risk impacting FX markets is scheduled for the week on the DailyFX Webinar Calendar.
After yesterday’s losses, European stocks are fading once again as global geopolitical tensions continue to dominate and fret investors. UK and European indices have been unable to hold on to all of their early gains, with the FTSE 100 unable to keep a hold on the 7,400 level.
Today, China’s premier Xi Jinping and US President Donald Trump spoke by phone to discuss the escalating tensions with North Korea, and a state-run Chinese newspaper threatened to cut off North Korea’s oil supplies if it tested a nuclear weapon.
Meanwhile, Trump said Wednesday that Russian President Vladimir Putin is partly to blame for the crisis in Syria and condemned his support of the ‘truly evil’ Bashar al Assad. That’s set the stage for tense talks between US Secretary of State Rex Tillerson and his Russian counterpart Sergei Lavrov in Moscow, where Putin said ties between Russia and the US appear to have deteriorated under Trump.
The rising tensions over Syria have caused Russian stocks to lose all their post-US election gains.
France’s election later in the month is also giving investors a reason to seek cover in safe havens. Gold and the Japanese Yen have both gained, though few suspect they can remain at these high levels in the long term.
The Euro is also in a downtrend versus the Swiss Franc, which is “significantly overvalued” according to the Swiss National Bank.
The FTSE is currently down 17.00 in the London session at 7,348.50 after giving up its gains from earlier in the session. The DAX 30 has also fallen back from a strong opening test of resistance at 12,240 to fall back towards support at 12,152, a daily rise of 13.15. France’s CAC 40 has also dropped back from a daily high of 5,138.5 to 5,089.2, down 6.0 points.
Chart: FTSE 100 15-Minute (Intraday April 12)
--- Written by Oliver Morrison, Analyst
To contact Oliver, email him at oliver.morrison@ig.com
Follow Oliver on Twitter @OPWMorrison
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