It was a hectic day yesterday as Prime Minister Theresa May stunned markets by calling a snap general election. Volatility began before May’s announcement as rumours suggested that May would resign due to health concern. This, of course, was not true and Sterling began its ascendency after the announcement that the UK will hold a vote on June 8th. With a 19 point lead in polls over her nearest rivals, this seems to be an opportunity for the Tories to gain a sizeable majority. Sterling appreciated substantially throughout yesterday’s European session climbing 1.5% from the start of the day.
In other news, US stocks opened lower after a surprise announcement from Goldman Sachs. The S&P 500 Index fell 0.28% and the DOW 0.42% when markets opened yesterday. Goldman shocked Wall Street after reporting a decline in revenues from bond trading, its traditional strength. The FTSE also dropped over 2%, its biggest decline since June after May called a snap general election in the UK.
Today’s economic docket is light with only one piece of high tier data being released. The Eurozone post their annual CPI figure this morning, forecast to remain at 1.5%. However, economists’ will continue to focus on yesterday’s announcement by PM Theresa May.