The FTSE Finish Line - August 02 - 2024
FTSE Red On The Week, As US Recession Concerns Spark Investor Fears
Friday saw a sharp decrease in London stocks along with wider market losses as investors became more cautious after the US jobs report came in far below expectations and the unemployment rate rose to 4.3%, stoking concerns of a US recession. The blue-chip FTSE 100 index was down 1.34% on the day it had its worst performance in almost three months. The FTSE 250 mid-cap index was likewise down.
Shares of British outsourcing firm Capita fell by 10.5%, marking the lowest point since March 6 and making it the top loser on the FTSE SmallCap Index. The company's half-year revenue dropped 16% to £1.24 billion. Capita now anticipates a low to mid-single digit percentage decrease in adjusted revenue for 2024, revising its prior forecast which had been broadly in line with 2023 revenues. Despite this, the company is maintaining its full-year profit guidance. Year-to-date, the stock has fallen approximately 13%.
Following a 1.1% loss in the previous session, investment banking and brokerage stocks in London saw a 1.8% decrease.As Italian competitor Salvator Ferragamo revealed a 41% drop in its operational earnings for the first half of the year, personal goods like Burberry had a more than 1% decline.The owner of British Airways canceled its proposed acquisition of Spain's Air Europa, citing regulatory environment worries, IAG Group surged 3.85% to top the FTSE 100.
As gold prices increased due to demand from safe havens and expectations of a September fall in the U.S. GOL, precious metal miners saw a 0.7% gain. Banks continued to lose 0.8% over the previous session. Due to the Bank of England's quarter-point rate decrease and the French lender Societe Generale's reduction in its forecast for retail net interest income, the industry saw its worst day since February 2022 on Thursday. After cutting rates from a 16-year high, the British central bank announced on Thursday that it would be cautious about reducing them any further. This was the first rate cut since 2020.
Technical & Trade View
FTSE Bias: Bullish Above Bearish below 8225
Primary support 8000
Primary objective 8593
Daily VWAP Bearish
Weekly VWAP Bearish
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 the author, and not to the author’s employer, organization, committee or other group or individual or company.
Past performance is not indicative of future results.
High Risk Warning: CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 75% and 75% of retail investor accounts lose money when trading CFDs with Tickmill UK Ltd and Tickmill Europe Ltd respectively. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.
Futures and Options: Trading futures and options on margin carries a high degree of risk and may result in losses exceeding your initial investment. These products are not suitable for all investors. Ensure you fully understand the risks and take appropriate care to manage your risk.
Patrick has been involved in the financial markets for well over a decade as a self-educated professional trader and money manager. Flitting between the roles of market commentator, analyst and mentor, Patrick has improved the technical skills and psychological stance of literally hundreds of traders – coaching them to become savvy market operators!