Footsie gallops to record high
Saturday 15 February 1997
The FTSE 100 index climbed by nearly 14 points to close at 4,341. Across the Atlantic, investors took advantage of the Dow Jones index bursting through the 7,000 barrier on Thursday to take profits yesterday, despite new figures signalling the absence of immediate inflationary pressures in the American economy. The index was 29 points lower at 6,992 in closing trade. The Dow's gain of more than 1,000 points in only four months reflects investors' optimism about the strength of the US economy, although some experts remain fearful that share prices could fall sharply from their giddy heights. Just two months ago Alan Greenspan, chairman of the Federal Reserve, warned about the "irrational exuberance" of the financial markets.
A batch of statistics yesterday showed an unexpected fall in prices charged by manufacturers in January, along with flat industrial production and unchanged consumer confidence. The general picture was one of steady growth putting no pressure on the Federal Reserve to increase interest rates in the near future. Jonathan Basile, an economist at HSBC Markets in New York, described the figures as "Fed-friendly".
Marilyn Schaja, an economist at Donaldson, Lufkin and Jenrette, said: "The economy is slowing down from the torrid pace of the fourth quarter."
The harsh winter explained the absence of any increase in industrial output last month. Snow and storms led to a fall in hours worked in manufacturing and mining.
Energy output rose sharply, also thanks to the weather, and output of business equipment - mainly computers and trucks - built up speed. Analysts said the total production figure was likely to rebound in February. Even with the wintry slowdown, manufacturing output last month was 5.1 per cent higher than a year earlier.
Yet the continuing recovery in industry has not yet fed through into higher prices at the factory gate.
Separate figures showed that these fell by 0.3 per cent last month, their first decline since October 1994.
Lower oil prices accounted for the unexpectedly good news, and should feed into producer prices for the next few months.
Separately, the University of Michigan's index of consumer sentiment was unchanged between January and February.
- 1 Hilary Mantel 'should be investigated by police' over Margaret Thatcher assassination story, says Lord Bell
- 2 Rihanna 'nude pictures' claims emerge on 4Chan as hacking scandal continues
- 3 Kim Kardashian 'nude photos' leaked on 4chan weeks after Jennifer Lawrence scandal
- 4 'F*ck it, I quit': KTVA reporter Charlo Greene quits live on air in spectacular fashion
- 5 Hitler’s former food taster reveals the horrors of the Wolf’s Lair
Rihanna 'nude pictures' claims emerge on 4Chan as hacking scandal continues
Kim Kardashian 'nude photos' leaked on 4chan weeks after Jennifer Lawrence scandal
'F*ck it, I quit': KTVA reporter Charlo Greene quits live on air in spectacular fashion
Jennifer Lawrence: Leaked 4Chan sex video branded 'fake' by users
Jennifer Lawrence 'naked sex video' will be leaked next, threatens 4Chan celebrity photo hacker
Scotland could still declare independence – even without referendum, says Alex Salmond
Scottish referendum results: Cross-party consensus collapses amid Tory-Labour spat on the 'English question'
Hilary Mantel 'should be investigated by police' over Margaret Thatcher assassination story, says Lord Bell
Scottish independence: David Cameron is becoming the 'George Bush of Britain'
Plebgate MP Andrew Mitchell called officer a 'little s**t', claim court documents 'exposing ex-Chief Whip's 'record of abusing police'
Archbishop of Canterbury admits doubts about existence of God
iJobs Money & Business
£65000 Per Annum Benefits + bonus: Clearwater People Solutions Ltd: If you are...
£20000 - £25000 per annum + OTE £40,000: SThree: SThree are a global FTSE 250 ...
£20000 - £25000 per annum + OTE £40000: SThree: As a Recruitment Consultant, y...
£20000 - £25000 per annum + OTE £40,000: SThree: SThree Group have been well e...