UK investors are buying the dip after Powell's comments

01/12/2022 | 05:22am

Reassured by comments from Fed chair Jerome Powell, investors returned to tech stocks and bought the dip. The FTSE 100 ended 0.6% higher yesterday.

Powell said while the central bank may raise rates this year to curb inflation, it expects inflation to peak by mid-2022. There was no indication that the Fed would rate hikes as soon as March, or that he would raise rates four times.

London's FTSE 100 rose on Wednesday morning as a result, gaining 0.8%. Sentiment was also lifted by positive earnings updates. Supermarket group Sainsbury's, fashion retailer JD Sports Fashion and recruiter PageGroup gained between 1% and 3% after raising their full-year profit guidance. Miners and energy stocks were also among the top gainers. 

However, food delivery company Just Eat Takeaway.com dropped 2.4% as its results, although showing 14% growth, were not good enough for investors.

 

Things to read today:

Unilever has ‘lost the plot’ by fixating on sustainability, says Terry Smith (Financial Times)

Fed’s Powell Says Economy No Longer Needs Aggressive Stimulus (WSJ)

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