The Dow Jones rode in like something of a white knight on Wednesday afternoon, rescuing Europe from its intraday lows.
The Dow added 350 points after the bell, a rebound likely born of nothing more than bargain-hunting investors sweeping in at near-4 month lows. That pushed the index above 27400 – for reference, around 1,100 points shy of its mid-February all-time highs.
While the US gains weren’t inspiring enough to spark an actual rebound in Europe, it did give the FTSE et al a life raft to cling onto. The DAX was still down 0.4% at 12750, but compare that to its mid-morning nadir of 12370 and you get a taste of what the Wall Street open did for the region.
The UK index, meanwhile, managed to tooth and nail claw its way back above 7000 as it trimmed its losses to just 0.1%. In a less fearful geopolitical climate it likely would have been sharply higher give sterling’s own decline.
The pound sank 0.6% against the dollar, taking cable back to $1.2925, and 0.4% against the euro, leaving it at €1.895. This as the atmosphere between the UK and EU remains icy at best ahead of next week’s trade negotiations. The UK is expected to publish its formal mandate tomorrow, so sterling could be in for some more movement before the month is out.