The FTSE 100 slipped on Friday and headed for its first weekly decline in five weeks, as fading confidence in a swift resolution to the Iran conflict pushed investors back into a more defensive stance. Risk appetite was further unsettled by a warning from Bank of England Deputy Governor Sarah Breeden that global equity markets remain vulnerable because valuations are not fully reflecting the scale of risks facing the world economy. Rising crude prices and stalled efforts to reopen the Strait of Hormuz kept geopolitical tension firmly in focus, weighing on sentiment across London and hitting travel and leisure particularly hard, with Wizz Air among the notable fallers. Banks including Barclays and HSBC also came under pressure, while the FTSE 250 underperformed as investors cut exposure to more domestically and economically sensitive names.
Even so, the market backdrop was not uniformly negative. Sterling edged higher after stronger-than-expected retail sales data, which offered some support to the domestic demand picture, though that was not enough to shift the broader tone. Defensive pockets of the market held up better, with personal care, pharmaceuticals and grocers drawing support alongside energy and utilities, the latter helped by firmer oil prices and the demand for resilience in uncertain conditions. At the stock level, Computercenter stood out with a sharp rally after signalling its annual profit would come in ahead of expectations, while Mondi dropped heavily after warning that the Iran conflict was pushing up costs. The overall read-across for the FTSE 100 was one of cautious de-risking rather than indiscriminate selling: investors were still willing to pay for earnings visibility and defensiveness, but geopolitical risk and central-bank caution were enough to keep the index under pressure into the weekend.
TECHNICAL & TRADE VIEW – FTSE100
Daily VWAP Bearish
Weekly VWAP Bullish
Above 10400 Target 11200
Below 10300 Target 10100
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