FTSE nudges higher on mixed results

The FTSE is moving higher this morning but yesterday’s sharp rally has proved to be mostly froth.

Downtrend 5

FTSE nudges higher on mixed results

The FTSE is moving higher this morning but yesterday’s sharp rally has proved to be mostly froth. A mixed bag of results and underlying news are pulling in two directions: on the one hand the US economy seems to be picking up faster than expected after the lockdowns have been eased, on the other the threat of a second wave of COVID is becoming stronger. US retail sales rose sharply in May and recouped more than 60% of the sales lost in March and April. But at the same time Beijing is gradually going into a bigger lockdown, prompted by new cases. The city has cancelled half of the flights in and out of its main airport, the world’s second busiest.

The big movers on the FTSE are energy supplier SSE, up 9% on results, construction equipment hire firm Ashtead, still benefiting from US infrastructure plans, and property firm Berkeley Group, which rallied despite profits and revenue declining by around one third.

Germany to offer €5 billion bunds today

Having raised over €31 billion for 30-year bonds sold through banks last week, Germany will offer another €5 billion of its benchmark bunds. The safe haven asset is expected to be well received, particularly as plans are firming up for the EU to agree on a massive recovery plan in July.

A rise in US oil stocks hits WTI prices

Brent crude is gaining ground on signs of a US economic recovery but ironically, the US domestic WTI contract is lagging behind. Yesterday’s data from the American Petroleum Institute showed a rise in the level of oil stocks, caused by some of the oil still being offloaded into the US from Saudi tankers sent in May. Some of the buildup is also being created by a reduction in demand, caused by concerns that a pickup in new coronavirus cases in three or four US states will slow down both transport and industrial consumption.  EIA petroleum reserve stocks later today are expected to confirm that stocks over the last seven days have been building up.

More from FTSE 100

Disclaimer: The information on this web site is not targeted at the general public of any particular country. It is not intended for distribution to residents in any country where such distribution or use would contravene any local law or regulatory requirement. The information and opinions in this report are for general information use only and are not intended as an offer or solicitation with respect to the purchase or sale of any currency or CFD contract. All opinions and information contained in this report are subject to change without notice. This report has been prepared without regard to the specific investment objectives, financial situation and needs of any particular recipient. Any references to historical price movements or levels is informational based on our analysis and we do not represent or warranty that any such movements or levels are likely to reoccur in the future. While the information contained herein was obtained from sources believed to be reliable, author does not guarantee its accuracy or completeness, nor does author assume any liability for any direct, indirect or consequential loss that may result from the reliance by any person upon any such information or opinions.

Futures, Options on Futures, Foreign Exchange and other leveraged products involves significant risk of loss and is not suitable for all investors. Losses can exceed your deposits. Increasing leverage increases risk. Spot Gold and Silver contracts are not subject to regulation under the U.S. Commodity Exchange Act. Contracts for Difference (CFDs) are not available for US residents. Before deciding to trade forex and commodity futures, you should carefully consider your financial objectives, level of experience and risk appetite. Any opinions, news, research, analyses, prices or other information contained herein is intended as general information about the subject matter covered and is provided with the understanding that we do not provide any investment, legal, or tax advice. You should consult with appropriate counsel or other advisors on all investment, legal, or tax matters. References to Forex.com or GAIN Capital refer to GAIN Capital Holdings Inc. and its subsidiaries. Please read Characteristics and Risks of Standardized Options.

Open an Account