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FTSE Bounces Helped By Banks And Utilities

Published 19/02/2020, 10:14
Updated 14/12/2017, 10:25

A lot of negative corporate news over the last two weeks has hit a number of top FTSE stocks and created fertile ground for bargain hunters. This morning high volumes of trade are going through banking stocks, which are being bunch-bought alongside HSBC bank after the bank’s weak results hit the share price with a 5% decline. Utility firm Centrica (LON:CNA) is in a similar position, rising to the top of the FTSE after it reached oversold territory Monday.

The wider background picture is also slightly improving given that new coronavirus cases in China seem to be coming in at a slower pace than before. The one threat for some UK businesses remains Brexit news, where nothing that would be considered positive for UK businesses has made the headlines recently.

The latest – a decision to bring in a point-based immigration system for overseas workers from next January - will hurt in terms of wage costs, particularly industries that rely on low-skilled, low-pay labour such as construction, food processing and social care.

The pound sits still ahead of data

The pound is waiting for a new impulse against the dollar this morning, having been fairly static in the afterhours. This impulse could be provided by a slew of inflation data due later today including the UK Retail Price Index and Producer Price Index. The numbers are broadly expected to show some improvement on the previous month as the December election and Brexit provided consumers with new stability and heightened levels of confidence. Also later today the FOMC minutes and US Redbook data will likely trigger fresh dollar moves.

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.

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