Wednesday, 1 February: FTSE indices kicked off the morning on the rebound after earlier wobbles in the week, following more bullish trade in Asia overnight but sterling strength muted gains as investors waited on the upcoming US Federal Reserve policy decision due later today – the FTSE 100 closed +0.12%.
Data for the UK showed that UK manufacturing activity continued to grow strongly, slowing only slightly from a two and a half year high seen last month. The purchasing manager indices read came in at 55.9 for January, with the continued expansion underpinned by a solid increase in new order intakes, mainly from the domestic market. Improving global market conditions and weaker sterling also helped to drive a modest increase in export orders. This marked a sixth consecutive month of headline PMI data coming in above the 50-point mark. However, with this good news also came the news that producers’ input cost inflation accelerated to the highest since data collection began in 1992 with sterling depreciation prompting the rise in the metric – the implication that further consumer price pressure looks to be inevitable.
Apple’s latest update on performance to the market helped to buoy the Dow Jones Industrial Average +0.1% as it reported strong demand for the iPhone, which helped boost revenue to a record $78.4bn and dispel worries of a fourth consecutive quarter of iPhone sales declines. Figures showed that the iPhone and Mac were booming, iPad sales continued to slide, and the Services division saw revenues increase by 18% as it becomes increasingly central to the tech firm’s strategy going forwards. Apple also reported a healthy rainy day fund of almost a quarter-billion dollars, 94% of which is offshore.