Wednesday, April 21We Break the News

London Stocks Rebound from 3-Week Lows, Russian Ruble Recovers from Near 5-Month Low, Swiss Franc at 8-Month Low

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London Stocks Rebound from 3-Week Lows
The FTSE 100 added more than 0.5% to trade around 6,715 on Friday, recovering from the previous session’s three-week low, with mining and oil & gas stocks among the best performers helped by higher commodity prices. Investors across the globe focused on the prospect of a strong economic recovery, despite worries about surging coronavirus cases in Europe. In addition, economic data showed Britain’s retail trade rose firmly in February even as non-essential shops remained in a coronavirus lockdowns. On the corporate front, British insurer Aviva gained after it sold its Polish operations to Germany’s Allianz for €2.5 billion in cash.

Russian Ruble Recovers from Near 5-Month Low
The Russian ruble continued to recover from a near 5-month low of $76.96 hit earlier in the week, mainly supported by month-end tax payments that prompted export-focused companies to convert their foreign currency proceeds into rubles. The USD/RUB pair has been under pressure amid imminent US sanctions against Moscow after President Joe Biden pledged that the Russian president Vladimir Putin will pay a price for alleged election meddling and cyber hacking. Also, the oil market lost further ground from multi-month highs in the light of new coronavirus-related restrictions in European countries but the Suez Canal blockage helped to curb some losses. On the monetary policy front, the Central Bank of Russia surprised markets by delivering a 25bps hike in interest rates and opened the door for further rises in the coming months to contain inflation.

Swiss Franc at 8-Month Low
The Swiss franc traded little changed close to the 0.94 per USD level, the weakest since July of 2020 amid a general dollar strength benefited by expectations of a huge US economic rebound and high Treasury yields while the outlook in Europe remains more vulnerable due to rising Covid-19 cases. On the monetary policy front, The Swiss National Bank stuck to expansionary monetary policy during its March meeting, saying the Swiss franc remains highly valued, despite the recent weakening, and the coronavirus pandemic continues to have a strong adverse effect on the economy. The bank implemented negative rates and expended hundreds of billions of francs on foreign exchange interventions to curb to stop the rise of the franc and fight off deflation.

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