The U.K. Stockmarket
- The U.K Stock market was higher this week.
- On Tuesday MPs rejected Theresa May’s Brexit deal. Jeremy Corbyn tabled a vote of no confidence in the government which the government survived on Wednesday. Theresa May urged MPs to put self-interest aside and “work constructively together”.
- Markets believe there is little chance that her plan B, to be presented on Monday, will fare any better than the original and that the March 29 deadline will be extended. That general view saw sterling higher last week to two-month highs against the dollar.
- Our Breadth indicator stayed positive and our Momentum indicator, although still negative, ticked higher again.
The U.S. Stock market
- The U.S. Stock market was higher again this week continuing a strong start to 2019.
- Stocks surged when Treasury Secretary Steven Mnuchin proposed that, as a gesture of good will in the trade negotiations with China, tariffs on some Chinese goods should be lowered (the White House later strongly downplayed this suggestion).
- Sentiment was also lifted by good earnings reports from a number of financial institutions as the latest earnings season began. Most analysts are expecting earnings to grow modestly in the first quarter of this year.
- Our Breadth indicator turned neutral and our Momentum indicator ticked up for the first time in nearly four months.
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