Contagion warning

The FTSE100 started the week on the back-foot, extending last week's downtrend closer to August lows. Sharp declines in the Emerging Markets FX space are fuelling fears of contagion as ZAR and INR joined TRY to post painful losses.

Contagion warning

The FTSE100 started the week on the back-foot, extending last week’s downtrend closer to August lows. Sharp declines in the Emerging Markets FX space are fuelling fears of contagion as ZAR and INR joined TRY to post painful losses. Even steady defensive stocks are not immune from the risk-off negativity. Energy shares are valiantly struggling to keep the index afloat ahead of noon OPEC monthly report.

Contributors: FTSE -37pts, with the likes of GSK/BATS/VOD/DGE/RB (risk off, negative momentum), AZN (risk off, profit taking), HSBA (heavyweight, risk off, fears of Turkish contagion), PRU/BARC, RBS/LLOY (risk off, fears of Turkish contagion) and GLEN (stronger USD). Fighting a lonely fight on the opposite side of the spectrum are BP/RDSB (expectations from the upcoming OPEC report).

Technicals: The FTSE100 has broken below last week’s 7635 lows

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Categories: Analysis, News
Tags: FTSE 100

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