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The FTSE 100 held onto positive territory, gaining 24.14 points to reach 7,598.11 on the session, primarily driven by the strong performance of mining stocks. Glencore witnessed a notable increase of 5.3%, while Antofagasta recorded a gain of 3.7%, and Rio Tinto saw a rise of 2.72%. Investors are optimistic as they anticipate that the recent action taken by the People's Bank of China to reduce its seven-day reverse repo rate will stimulate growth in the Chinese economy, which has displayed signs of weakening. This decision marks the first instance in nine months that the central bank has intervened to enhance short-term liquidity in the interbank market of the country.

On the negative side of the ledger, shares of UK homebuilders plummeted by as much as 3.8% as an unexpected surge in wages raised the prospects of a Bank of England (BoE) rate hike, with markets now pricing a 50% chance of the BoE raising rates to 6%. The British housebuilding sector faced significant pressure due to the sudden increase in UK wage growth and a notable rise in employment during the three months leading up to April. These developments fueled expectations that the BoE would implement multiple interest rate hikes to curb persistent inflationary pressures. The anticipated higher interest rates from the BoE would subsequently result in increased mortgage rates, deterring potential homebuyers. Among the FTSE 100 homebuilders, Persimmon led the downside skidding over 4% and Taylor Wimpey suffered declines exceeding 3.3%%, while Barratt, the UK's largest homebuilder, experienced a loss of 2.67%. As tough as the day was for homebuilders the poor performance was exceeded by Admiral Group sitting at the bottom of the table with shares sliding just shy of 5% as Citi issued a ‘Sell’ rating with a negative catalyst watch as they expect a downside earnings revision to the first half of 2023 numbers, this comes after Admiral reduced its full year dividend by 40% in March.

FTSE Bias: Intraday Bullish Above Bearish below 7550

• Below 7540 opens 7435
• Primary resistanceis 7660
• Primary objective 7720
• 20 Day VWAP bearish, 5 Day VWAP bullish

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(Click on image to enlarge)

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