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Jasper Lawler

Jasper joined the market analyst team in the LCG London office in 2016, and has accumulated over ten years' experience working in the financial markets. He delivers regular commentary, seminars and webinars on market news, trading analysis, strategy and psychology. He is regularly interviewed by BBC News, Bloomberg, CNBC and Sky News, and has featured in The Times, Guardian and Daily Telegraph. Before joining LCG, Jasper worked as a market analyst and as a market strategist at two other well-known broker-dealers in the City of London and on Wall Street. He writes a widely-followed daily market wrap, plus commentaries on US, European and UK stock markets, FX and commodities. Jasper also hosts a weekly charting analysis webinar. He is qualified as a Chartered Market Technician (CMT) with the Market Technician Association, and has a degree in Finance and Economics.

USD

MARKET WRAP: British Pound & FTSE Higher as UK Enters Lockdown

March 24, 2020
UK enters lockdown
The UK enters lockdown

British pound & FTSE higher as the UK enters lockdown

The mood in markets is looking a little sturdier on Tuesday. The Fed has kitchen-sunk it, governments are making the tough decisions needed and Wuhan is showing some light at the end of the tunnel for the coronavirus.

US and European stock markets are setting up for a strong open. Bond yields are higher. The US dollar is lower, helping other currencies rebound. Gold and oil are both rising.

The British pound & the FTSE are higher as the UK enters lockdown. Investors are interpreting ‘stay home’ orders as a necessary evil.

It’s the only viable option to avoid a public health crisis. Whether it can practically work will play in the future direction in markets. We think how far-reaching the economic damage of the lockdown will be is still not fully priced into the pound. GBPUSD could still have a run at 1.10.

The Fed kitchen-slinked it. If you’re a believer of ‘don’t fight the Fed’, what was announced yesterday was a buy signal.

With the Federal Reserve kitchen-sinking, it has gone some way to calm markets. With a little time to review, there were some astonishing measures taken.

For us, there were three standout measures were Number 1: Open-ended QE, which means the Fed will just keep buying as they see fit with no restraint. Number 2: Lending directly to businesses completely bypassing high street banks in the process. Number 3:  Corporate bond buying where the Fed can even buy corporate bond ETFs in the stock market.

The Unpassed US stimulus bill keeps getting bigger. There is still room for US politicians to undermine the market rebound. Both parties are fighting to take credit for the spending.

Adding to the improved mood is what seems to be an ever-rising figure for the US government stimulus. House Speaker Nancy Pelosi is now talking about a $2.5 billion. The Senate was apparently on the cusp of a deal but Trump told Republicans should not agree to Democrat stimulus measures.

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