FTSE 100 ends in the green on Fed chairman’s comments

by Jonathan Adams
FTSE 100

Britain’s blue-chip benchmark closed around 0.21% higher, at 6,625, while the FTSE 250 rose over 76 points, at 21,057

FTSE 100 finished Tuesday in the green, having been lower most of the day as traders mull over comments from the Fed chairman during his appearance before the Senate.

Britain’s blue-chip benchmark closed around 13 points higher, or 0.21%, at 6,625.

The midcap FTSE 250 also rose, up over 76 points at 21,057.

Jerome Powell made few noises that suggested the US central bank’s support of the economy would be slackened off any time soon.

It comes as little surprise to see a dovish stance from Powell, who believes the Fed will need to remain accommodative for “some time” yet, said Joshua Mahony, senior market analyst at online trading group IG Index, in a note.

Ongoing monthly $120 billion government bond purchases look likely to continue as we move through the year, yet Powell noted that this could change once their inflation and employment targets are reached, he said.

Stocks were lower on Wall Street. The Dow Jones Industrial Average dropped around 134 points at 31,386. The S&P 500 shed 20 points and the Nasdaq declined over 273 points at 13,259.

The London stock market does not have the heavyweight technology stocks that US exchanges do but they are big enough to drag the market lower.

The FTSE 100 fell 41 points (0.6%) at 6,571, led by Scottish Mortgage Investment Trust PLC, which fell 8.0% at 1,165p.

The investment trust is a big holder of some of tech’s biggest names, including Tencent, Alibaba and Delivery Hero while it is probably best known for being an early mover into Tesla Motor.

With technology stocks running into a bit of profit-taking recently, the investment trust’s shares are down from 1,395.82p a week ago, shedding 17% or nearly one-sixth of their value.

The current net asset value per share of the trust stands at 1,276.65p.

Other investment trusts which declined today, with JPMorgan China Growth & Income PLC falling 9.2%; Baillie Gifford US Growth Trust PLC shedding 8.2%; Allianz Technology Trust PLC declining 7.9%; and Edinburgh Worldwide Investment Trust PLC dropping 6.9%.



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