Partial G20 accord to give moderate lift to shares

A mildly positive start is expected for stock markets this morning, as risk appetite returns after a G20 summit that resulted in few big surprises.

GFT is quoting the FTSE 100 index to open up five points from Friday’s close, at a level of 6,087. Elsewhere in Europe the German Dax is called up seven points at 7,433, and the French CAC is quoted up four points to open at 4,161.

Although a compromise deal was struck on common indicators to judge global economic imbalances, China succeeded in blocking moves to use exchange rates and currency reserves as criteria to measure the imbalances. The outcome will be received with at best subdued enthusiasm, while sceptical traders will see it as little more than preserving the status quo.

But some money was clearly off the table ahead of the weekend, with markets taking a breather in case any unexpected disruption materialised.

Any return of risk appetite will however likely be tempered by continued tensions in the Middle East, with reports of up to 200 people killed in Libya as the government cracks down on protesters, and violence in Yemen.

The other focus this week will be minutes from the Bank of England’s MPC meeting on 9 February. Rumours were circling the City on Friday that another member had voted for a rise in rates, increasing the likelihood of a rise in the near future.

Martin Slaney is GFT’s director of global dealing operations.