Market reaction to Philip Hammond's Autumn Budget 2017: Meh

 
Jasper Jolly
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Traders greeted the Budget with a collective yawn (Source: Getty)

Market reaction to Philip Hammond's Budget statement today was muted, with a small rise in the value of sterling in otherwise flat conditions.

The Budget contained some bad economic news in the form of much lower growth forecasts and some headline-grabbing measures such as the abolition of stamp duty for cheaper homes, but the statement did not provide much of a catalyst for trading.

The indifference from traders likely stems from the fact the reduced forecasts were predicted beforehand by the Office for Budget Responsibility, after it was forced to acknowledge productivity growth is unlikely to improve to pre-crisis levels.

Read more: Budget 2017: City economists react to growth downgrade

Sterling dipped in the immediate aftermath of the weaker growth forecasts, to hit lows of $1.3214 against the US dollar. However, the pound rapidly recovered to reach $1.3289, a small 0.31 per cent gain over the course of the day, at the time of writing.

The reaction was similar on bond markets, where 10-year government bonds traded with the range set earlier in the day: the yield on benchmark gilts reached 1.289 per cent at the time of writing.

The FTSE 100 enjoyed a small gain of 0.29 per cent, driven by strong gains for B&Q owner Kingfisher and emerging markets-focused bank Standard Chartered, amongst others.

The more UK-focused FTSE 250 enjoyed a stronger gain, increasing by 0.48 per cent.

Read more: Here are all today's Autumn Budget announcements that you need to know

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