FTSE 100 to start higher as momentum returns despite mixed Wall Street performance

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The FTSE 100 is expected to open higher on Wednesday as positive momentum return to equities despite a relatively flat performance in US indices overnight.

Spread-betters IG expects the FTSE 100 to add around 39 points at the open after ending Tuesday’s session around 8 points higher at 6,531.

Traders seem set to recover some ground after equity sentiment mostly ran out of steam in the US overnight, with the Dow Jones Industrial Average closing down 0.03% at 31,375 while the S&P 500 ended 0.11% lower a 3,911. The Nasdaq was the positive outlier, closing up 0.14% at 14,007.

“In all likelihood, after a few firm sessions, equities just ran out of short-term momentum, with a lack of new drivers from the Biden-stimulus progression prompting a wait-and-see-for-a day approach. The buy everything trade still has the upper hand and [fear of missing out] hasn’t gone, it’s just taken a little rest”, said Jeffrey Halley at OANDA.

Markets have been boosted in recent days by the fresh stimulus plans from the US as well as the rollout of coronavirus vaccines and declining case numbers in several countries, leading some to think the worst economic damage from the pandemic may have passed.

This optimism showed signs of returning in Asia this morning ahead of the Chinese New Year holiday, with Japan’s Nikkei 225 up 0.07% while Hong Kong’s Hang Seng rose 1.68%.

On currency markets, the pound was up 0.03% at US$1.382 against the dollar, although US inflation data later today could provide some catalysts for movement as US stimulus plans raise inflation concerns.

Around the markets:

Sterling: US$1.382, up 0.03%

Brent crude: US$61.13 a barrel, up 0.07%

Gold: US$1,842 an ounce, up 0.23%

Bitcoin: US$46,480, down 1.19%

6.50am: Early Markets – Asia / Australia

Stocks in the Asia-Pacific region were higher on Wednesday as China’s consumer price index declined 0.3% in January as compared with a year ago, while the producer price index rose 0.3%.

The Hang Seng index in Hong Kong surged 1.82% while the Shanghai Composite in China rose 1.52%.

In Japan, the Nikkei 225 gained 0.19% and South Korea’s Kospi was 0.86% higher.

Shares in Australia rose, with the S&P/ASX 200 closing 0.52% higher.

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Proactive Australia news:

BlackEarth Minerals NL (ASX:BEM) has soared to a new record high on signing a graphite supply and marketing agreement with Luxcarbon GmbH, Germany – a move that further positions the company as a supplier of graphite concentrate and downstream graphite products to EV and alternative energy markets.

Brookside Energy Ltd (ASX:BRK) (OTCMKTS:RDFEF) is fully-funded to drill and complete the much-anticipated Jewell Well in the SWISH AOI of Oklahoma, USA, after an  A$8.25 million capital raising, with shares up as much as 50%.

Kin Mining NL (ASX:KIN) is undertaking a capital raising of around $15 million to progress the next phase of exploration and resource growth at its Cardinia Gold Project near Leonora in Western Australia.

Ansila Energy NL (ASX:ANA) (OTCMKTS:PGNYF) (FRA:P6V) has started implementing several workstreams following the completion of its acquisition of the remaining 78.4% interest in Hartshead Resources Limited (HRL) that it doesn’t already own – solidifying its position as a new UK North Sea gas developer.

Blackstone Minerals (ASX:BSX) (OTCQX:BLSTF) (FRA:B9S) has begun trading on the US-based OTCQX Best Market under the code of OTCQX:BLSTF following the rapid increase in value of its shares and strong interest from US investors.

Pantoro Ltd (ASX:PNR) (FRA:RKN) has issued a Letter of Intent for the award of engineering, procurement and construction (EPC) works for the processing facility at the Norseman Gold Project to GR Engineering Services (ASX:GNG).

Castillo Copper Ltd (ASX:CCZ) (LON:CCZ) (FRA:7OR) has further extended the large copper discovery at Big One Deposit within the Mt Oxide Project in Queensland’s Mt Isa copper-belt following the final results from its 2020 program and recently found historical assays.

Ora Banda Mining Ltd’s (ASX:OBM) (FRA:M6N) infill drilling program at Riverina South deposit within the wider Davyhurst Gold Project in Western Australia has delivered strong assay results of up to 3 metres at 32.4 g/t from 34 metres.

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