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FTSE LIVE: UK markets plummet by 1.2% with catch-up trade after being closed on Monday

Much like the European markets, the FTSE 100 lagged behind US markets in recovering from pandemic lows.

“The overall market sentiment continues to lack positivity minus the gains we see only in a few big names… headwinds like a weaker dollar have superseded the drivers for the FTSE, leading to the mild weakness,” said Keith Temperton, a trader at Lombard Forte.

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12.10pm update: Euro marks another 28-month high

The euro neared the $ 1.20 mark on Monday after it scaled another 28-month high and the dollar slipped to a multi-year low as investors bet the Federal Reserve’s policy framework meant US rates would stay low for longer.

The euro reached $ 1.1997 in Asian trading hours, its strongest since May 2018, taking its gains to 7.5% in three months.

The Fed’s announcement last week that it would tolerate periods of higher inflation and focus more on average inflation and higher employment has encouraged traders to sell the dollar.

US political uncertainty ahead of November’s presidential election and concerns about US economic recovery have also weakened the greenback, with the euro the biggest beneficiary.

11.40am update: Every region trades higher than expected, except for FTSE

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Every region now trading higher except the FTSE 100, lagging today as investors return from the long weekend.

Tech outperforming, Travel & Leisure hit hardest.

Sterling surging +0.7 percent, Euro up +0.4 percent as investors continue to dump the US dollar.

6.15am update: Japan’s next leader to find pandemic ruining job market gains made by ‘Abenomics’

Japan’s unemployment rate crept up to 2.9 percent in July and job availability fell to a more than six-year low, data showed on Tuesday. Nearly 2 two million people lost their jobs in July, about 410,000 more than in the same month last year, with the number of job losses rising for six straight months through July.

Among the hardest hit have been non-permanent workers, who make up nearly 40% of Japan’s workforce and are concentrated in industries like hotels, restaurants and entertainment.

The number of temporary workers fell by 1.31 million in July from a year ago, the biggest drop in more than 6-1/2 years.

“We’re seeing more non-permanent workers lose their jobs, especially in industries vulnerable to the pandemic,” said Shinya Kodera, an economist at Mizuho Research Institute.

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