The FTSE Finish Line: FTSE Ending The Week Frimley In Red

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UK stocks are ending the week in the red shedding 0.74% on Friday, the decline was primarily led by mining companies with Antofagasta down 3.45%, due to concerns surrounding a bleak demand outlook in China. Additionally, data indicated that retail sales within the domestic market had fallen more than anticipated during the month of July. The combination of weaker demand prospects in China and disappointing retail sales figures domestically contributed to the initial decline in UK stocks. These market movements illustrate the intricate interplay of both global and domestic economic indicators impacting investor sentiment and market trends.

Shares of RS Group have encountered a decline of as much as 4.2%. This performance positions the stock as the top loser on the FTSE 100 Index. The stock has reached its lowest point since October 30, 2020. UBS, a brokerage firm, has downgraded RS Group's stock from "buy" to "neutral" and lowered its price target (PT) from 1250p to 800p. This downgrade is influenced by UBS's projection of a more substantial "unwind" in the company's profits. Recent data indicates weakening markets and a reversal of share gains, contributing to this assessment. UBS foresees a period marked by sustained negative organic growth and margin pressure for the company. Additionally, the brokerage anticipates a significant drop in gross margin in the near term, as the inflation-driven gains on inventory recede. The stock's year-to-date decline stands at 22.88% as of the previous close, highlighting the challenges faced by the company in the current market environment. The combined impact of UBS's downgrade and the broader market sentiment has contributed to the observed decline in RS Group's stock value.

On the positive side of the ledger British American Tobacco sits at the top of the blue chip index gaining 1.15% on the session, the stock is currently trading at historically low levels, with several key indicators highlighting its undervaluation. The company's price-to-earnings (P/E) ratio is at its lowest point in 23 years, suggesting that the stock is relatively inexpensive compared to its earnings. Additionally, the company's yield, which represents the dividend income relative to its stock price, is also at its highest level in 23 years, making it an attractive option for investors seeking income. Moreover, BAT's stock is trading at a historical discount of 52%, meaning that its current price is significantly lower than its average historical valuation. This substantial discount has attracted bargain hunters, investors who seek out undervalued stocks with the expectation that their prices will eventually rise to reflect their true worth. These investors see potential for the stock's value to increase over time, prompting them to acquire shares at the current lower price.

FTSE Intraday Bullish Above Bearish below 7435

  • Below 7300 opens 7250
  • Primary supportis 7220
  • Primary objective 7158
  • 20 Day VWAP bearish, 5 Day VWAP bearish

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