Punters bearish on Dow, but still bullish on PartyGaming
July 19, 2005admin No Comments »Spread betting traders are going into Wednesday’s vital statement from Federal Reserve chairman Alan Greenspan with short positions in the Dow and US Treasury bonds.
Bookmakers say that most punters seem to believe that the Dow is boxed in around 10,660, but some think that the FTSE100 index in London may manage to make further gains.
IG Index said that the start of this week saw its clients going short of the Dow and long of the FTSE, banking on a continuation of the UK index’s recent strong out-performance.
Since the beginning of April, the FTSE has risen by 8.5%, while the Dow has gained less than 6%, as the pound’s fall against the dollar has aided UK exporters.
Finspreads said that it is seeing more of its clients moving long of the FTSE, after a period in which many have been short in the face of a steady rally. Others were opening shorts in the Dow today around 10,650.
In forex, Finspreads said that punters were buying into the pound and the euro against the dollar, hoping that Greenspan’s speech to Congress at 3pm on Wednesday might mark the end of the US currency’s advance.
Bulls of gold have had a hard time recently, with the yellow metal failing to hold onto its levels just after the London bombs on 7 July. Bookies said however that most longs in gold were holding on and hoping for gains to come.
IG Index said that clients remained long of PartyGaming, the Internet poker giant which floated last month.
The shares have surged from 119p on flotation into the 160s, and bookies have been unable to borrow stock to hedge client short positions – so most have only been accepting up-bets on PartyGaming.
Finspreads said that the majority of its client positions in US Treasury bonds were short, ahead of the Greenspan testimony this week.
The Fed chairman is expected to give hints on whether he will have to raise American interest rates much above the current 3.25%.
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