UK stocks paint a grim picture of the economy, one doing far worse than its major peers.
Surely cause to cover downside risk for the pound - but traders are doing the opposite.
UK stocks are significantly underperforming yet the pound is soaring and traders are getting long.
The struggles for UK stocks are not only due to the pound rising.
Weakness isn't confined to the FTSE.
The FTSE 250 is also struggling.
Stocks in Germany, Japan and the United States have made stronger recoveries.
In Germany and the U.S., stocks almost reached the record peaks traded before March's coronaivrus-led slumps.
The FTSE 250, which was over 22000 in January, has since peaked just over 18000.
Sterling traders have ignored the warning signs from stocks chasing a rising pound and turning long in August.
GBP/USD has broken into the monthly cloud for the first time since December 2019.
Dec 2019 cable reached 1.3516 but dropped to 1.1413 in March.
This month's high 1.3481.
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