Get 40% Off
🤯 This Tech Portfolio is up 29% YTD! Join Now to Get April’s Top PicksGet The Picks – Just 99 USD

Commodity Stocks Lead FTSE Higher

Published 20/06/2018, 18:22
Updated 14/12/2017, 10:25

Commodity stocks lead FTSE higher

The FTSE along with other global indices was on the rebound on Wednesday, capitalising on the lack of trade war news to claw back some of the losses from the previous session. Moving towards the close the FTSE was 0.5% higher, trading ahead of its European counter parts thanks to the charge in heavily weighted commodity stocks as they traced oil and metal prices higher.

Concerns that the US – Sino trade war would see China’s demand for metal reduced meant mining shares had contributed heavily to the decline of the FTSE in the previous session. Today bargain hunters were out in force buying back into the likes of Glencore (LON:GLEN) and Fresnillo (LON:FRES) as metal prices recovered.

House builders dive on another profit warning

Berkeley Group (LON:BKGH), despite reporting bumper earnings this year, warned that profits will be around a third lower in the coming financial year as house prices falter in London. Another profit warning for another home builder has sent shivers through the house building sector. Berkley traded over 5% lower with other housebuilders such as Barratt Developments (LON:BDEV) and a Persimmon (LON:PSN) also dominating the lower reaches of the FTSE.

Brexit related uncertainty in addition to low wage growth has meant that the property market in London and the Sour East in subdued at best. Advantages of building on cheap land brought shortly after the financial crisis have now been capitalised, leaving a fairly bleak outlook; understandably investors are starting to move out of the sector which has been the star performer of the construction industry over the past few years.

May wins Brexit vote

The pound experienced increased volatility across Wednesday as traders focused on the Brexit Bill returning to the House of Commons, raising questions once again over Theresa May’s leadership credentials. Another vote, another concession: May, managed to scrape together a win in Parliament on the meaningful vote amendment in the Brexit Bill, as it ping ponged back to the Commons - this sent the pound on a relief rally higher.

Brexit blues and concerns over May’s future at the helm had left the pound languishing at 7-month lows. Now pound traders can shift their attention to the packed calendar tomorrow including the Mansion House Speeches and BoE MPC meeting.

The pound has already surged through $1.32, a more hawkish tone from policy makers tomorrow could see the pound look back towards resistance at $1.35.

Disclaimer: 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 warrant 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, the author does not guarantee its accuracy or completeness, nor does the 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.

Original post

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.