Sterling’s loss is FTSE’s gain

Sterling’s loss is FTSE’s gain

Sterling’s loss is FTSE’s gain

Mike van Dulken, Head of Research at Accendo Markets commented to clients around midday:

The FTSE100 is testing yesterday’s 7545 highs, extending what is now a 10% late March reversal into May. Other that positive results from oil major BP, the principal driver is yet more GBP weakness (versus USD more than EUR) flattering its international members. This comes from yet another spanner in the Brexit vote in the House of Lords, more disappointing UK macro data (PMI Manufacturing, Borrowing, Mortgage Approvals). The USD itself remains strong too, ahead of what is likely to be another hawkish monetary policy update from the Fed tomorrow night, hampering USD sensitive commodity prices and thus Miners.

Contributors: FTSE +40pts, with the biggest positive contributor being BP (Q1 results, tentative breakout), HSBC (breakout, optimism before Friday’s Q1 results), AZN/GSK (sector M&A optimism), RDSb (BP results read-across), DGE (weaker GBP) and IAG (technical breakout, oil off highs). The only real drag is BATS (broker downgrade).

Technicals: The FTSE 100 remains in a 6-week rising channel, but now trades an even narrower channel within. Still potential for a full retrace to Jan/Feb’s record highs of 7800, now just 250pts/3.3% away.”

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Categories: Analysis, News
Tags: FTSE

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