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The FTSE 100 is pushing back toward record territory once again today with help from Standard Charter Bank (LSE:STAN) and George Osborne. Approaching 3:00 pm in London, the FTSE is up 1.43% to 6.935.46, moving closer to surpassing its 6,974.26 52-week high.
To be clear, Standard Charter and George Osborne are not the only reasons the FTSE is recovering, but they are clearly leading contributors (the bank was the leading gainer among the FTSE 100), but for entirely different reasons.
A New Leader Can Make a Difference
That seems to be the case at Standard Chartered – and the reason that both Barclays and Bernstein “significantly improved” their ratings for the bank. Given the almost steady decline in Standard Charter shares over the past five years, resetting targets for STAN shares from 1,000.00 to 1,150.00 (Barclays) and from 700.00 to 1,200.00 (Bernstein) stimulated more than a little investor confidence. Standard opened today at 1,005.00, up in pre-market trading from yesterday’s close of 965.00. Standard shares are currently up 7.82% at 1,040.00 on a volume in excess of 10.5 million shares, 35% higher than its average volume of 7.8 million.
The consensus for the positive outlook seems to hinge almost entirely on Bill Winters’ appointed as the bank’s next CEO, following a cleaning up of the board recently. The former JP Morgan chief is expected to waste no time making significant changes that may well set Standard Charter apart from its London-based peers. That would be a very good thing.
A New Leader Could Make a Difference
The best time to produce a welcome budget is when it is the last one before an election. It works on every level from municipal to national. Both the anticipation and the delivery of Mr. Osborne’s budget have clearly had a positive impact on the London market today. More than delivering a budget, Osborne delivered a statement, especially when he declared that “This is a budget that takes Britain one more big step on the road from austerity to prosperity.” Highlights of his speech today include:
Policies
- No unfunded spending
- No irresponsible borrowing
- No sacrificing the permanent on the altar of the immediate
Practices
- No income tax on the first £1,000 of interest on savings
- Help for Help toBuy ISAs. The government will contribute £50 for every £200 the people contribute
- Increasing the personal tax-free allowance to £11,000 beginning this year
- Slashing duties on beer and petrol
Promises
In what may go down in history as on of the greatest budget-related speeches ever, Mr. Osborne promised to continue with the plan that caused Britain to grow “faster than any other major, advanced economy in the world last year.”
- We choose the future
- We choose economic security
- We choose jobs
- We choose the who nation
- We choose responsibility
- We choose aspiration
- We choose families
How the markets respond tomorrow may be even more interesting, once every has time to assess what has transpired today. I, for one, believe that there may be adequate activity and the right atmosphere to make this the week that the FTSE reaches 7,000.00. There are really only a few million variables that stand in the way.
