FTSE Flatlining Again As Early Gains Fade

Cutout paper illustration representing scheme and Stocks inscription

Image Source: Pexels


UK-listed stocks have experienced a relatively narrow trading range since late April as investors assessed a combination of mixed corporate earnings, a softer outlook for commodity-related stocks, and the ongoing impasse over the US debt ceiling negotiations. The FTSE100 started in the week posting early gains, however, the early optimism has faded as has the FTSE. The early lift was led by news of a £1.3 billion sale of NatWest shares leaving the UK taxpayer stake below 40% as the government continues efforts to be rid of its exposure by 2026. State ownership peaked at 84% during the financial crisis 15 years ago but is now at 38.6% after the Treasury sold shares back to the bank at a price of 268.4p on Friday. Sitting at the top of the index today is the world's largest dedicated online grocer Ocado, after shares traded at seven-month lows last week bargain hunters have stepped in, encouraged by their new marketing campaign focused on price promises, Ocado shares are up just over 3% on the session. Following President Joe Biden's remarks suggesting a potential improvement in relations between the United States and China, shares of Standard Chartered and Burberry, both with a focus on Asia, saw gains in the market. Investors reacted positively to the prospects of improved relations between the two economic powerhouses. Standard Chartered (+2.6%), a bank with a significant presence in Asia, experienced an increase in its stock price, the stock advance was further supported by an upgrade from Bank of America, lifting its price target. Similarly, Burberry (+1.6%), a luxury brand heavily reliant on the Chinese market, also saw its shares rise.

On the negative side of the ledger Halma the UK medical device business is sitting second to bottom on the session after UBS raised their price target for the firm to £26 from a prior £24.70, however, the bank maintained a ‘neutral’ rating on the stock which led to investors shunning the stock as it slid over 1.75%. Fellow medical device maker Convatec is sitting at the bottom of the pile today nursing losses of just over 2.3% heading into the close. On the fundamental front investors will be firmly focused on the upcoming release of UK inflation data on Wednesday which could play a crucial role in shaping the Bank of England's decision on further interest rate hikes.


FTSE Bias: Intraday Bullish Above Bearish below 7700

  • Below 7700 opens 7660
  • Primary support is 7635
  • Primary objective 8030
  • 20 Day VWAP bearish, 5 Day VWAP bullish

(Click on image to enlarge)

(Click on image to enlarge)

image


More By This Author:

Daily Market Outlook - Monday, May 22
FTSE 100: A Green Finish To The Week
Daily Market Outlook - Monday, May 19

Disclaimer: The material provided is for information purposes only and should not be considered as investment advice. The views, information, or opinions expressed in the text belong solely to ...

more
How did you like this article? Let us know so we can better customize your reading experience.

Comments