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Rollercoaster Day Ends Higher - Latest Market Analysis

A volatile day ended with UK shares showing gains, but continued nervousness over Euro-zone debt and the wider economy saw indices make violent swings throughout the day.

Having opened slightly higher, the FTSE 100 gained throughout the morning and traded 1.5% up by midday, but sellers used the gains as an opportunity to apply more pressure and send it in to negative territory within hours. Despite ongoing concerns of recession, US manufacturing orders in August grew more than expected which boosted markets worldwide, leaving the FTSE to eventually close 1% higher at 5156.8.

Unsurprisingly, Banks and Mining stocks were generally amongst the best performers on the day, but it was leisure giant Whitbread that topped leader board. For the second quarter running the group surprised on the upside with regard to its revenue and profit growth, this time its Premier Inn division also contributing alongside the ever-growing Costa Coffee brand. The shares gained 106p to close at 1563p, albeit still some 20% down from its year high.

Gold posted a modest decline having reached record highs over night, but one of the biggest casualties was the Swiss franc, which fell 9% after the Swiss National Bank said it would peg the currency to the Euro at E1.20. The Swiss franc had previously gained 30% versus the Euro in the last 6 months.

Worryingly, Spanish and Italian bond yields continued to rise and investors will be hoping that Europe’s leaders offer long term structural solutions to the now failing euro-zone project in the days ahead.

This was posted in Bdaily's Members' News section by John Dance .