Powell kept a hawkish stance, but a less hawkish phrase in his speech focused the attention of the market. While he warned that the time is not necessarily ripe to cut rates, but he also indicated that monetary policy is now "well settled in restrictive territory". Investors have concluded that U.S. rates could fall faster than Powell suggests, which is in line with their aspirations. The options market shows that the probability of a first rate cut as early as the March meeting is 60%. The figure rises to 86% for the May meeting. In short, investors are comforted by their blue-sky scenario: slowing inflation means rate cuts in the near future, soft economic landing and re-acceleration.

This morning, the FTSE 100 was down 0.6%, with energy stocks falling along declining crude prices and lower copper prices, due to the stronger dollar.

Petrofac Ltd rocketed more than 20% after it said it is exploring strategic options to enhance its balance sheet, including the potential sale of noncore assets. The energy services company is also in discussions with financial investors regarding minority stakes in its portfolio. It warned it might not meet its annual forecast of "broadly neutral free cash flow" due to delays in collecting advance payments on new contracts.

Vesuvius has initiated a share buyback program of up to £50 million. The company plans to repurchase shares until December 4, 2024.

Glencore fell 2.3% after it announced it completed the acquisition of stakes in Alunorte SA and Mineracao Rio do Norte SA from Norsk Hydro ASA for a combined $775 million.

Investors are preparing for a week filled with U.S. economic data that could influence Federal Reserve policy. The market is particularly focused on the upcoming nonfarm payrolls report.

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