Britain's Markets Flat Amid Tech Declines and Mixed Earnings:

Image Source : Krish Capital Pty Ltd

Index Update: The FTSE 100 index, a key benchmark index for the London stock exchange, went down around 0.07% on 23 January 2025. Utilities, HealthCare & Financials sector has witnessed a substantial growth. Moreover, Energy, Basic Materials & Consumer Cyclicals sector has faced a major decline. 

Macro Update:  Britain is taking steps to accelerate the approval of major infrastructure projects by limiting the number of legal challenges that opposition groups can bring, a move aimed at addressing planning delays identified by Prime Minister Keir Starmer as a key obstacle to economic growth. This economic growth is critical to the government’s broader plans over the next five years, though it has so far proven challenging to achieve. In corporate news, Shell announced the departure of Huibert Vigeveno, its head of downstream and renewables, after 30 years with the company. He will be succeeded by Machteld de Haan, an internal appointee. Meanwhile, London’s financial markets saw mixed results, with the FTSE 100 initially hitting a record high before closing flat due to declines in copper miners' shares, overshadowing positive corporate updates and expectations of monetary policy easing. The midcap FTSE 250 also retreated slightly, falling 0.1% after reaching a two-week high earlier in the session. 

Top Market Movers: Among top gainers on FTSE 100 index, Weir Group PLC (LSE: WEIR) witnessed a rise of 1.70% followed by EasyJet PLC (LSE: EZJ) which gained around 1.18%. 

Commodity Update: The dollar remained steady on Thursday, showing little movement ahead of upcoming tariff announcements from U.S. President Donald Trump. Market attention is also focused on upcoming central bank decisions, with the Bank of Japan expected to raise interest rates at the end of its two-day meeting on Friday. The U.S. Federal Reserve and European Central Bank are set to announce their rate decisions next week. In commodities, gold dropped 0.17% to $2,760.60, silver fell 0.75% to $31.18, and copper declined by 0.77% to $9,171.50. Brent crude saw a slight drop of 0.30% to $78.79 per barrel, with uncertainty surrounding global tariffs affecting energy demand. 

Our Stance: European shares remained flat on Thursday, hovering below the record high reached the previous day, as declines in technology stocks offset gains in telecom and utilities, with investors evaluating mixed corporate earnings. Meanwhile, oil prices dipped further amid uncertainty over how U.S. President Donald Trump's proposed tariffs and energy policies might affect global economic growth and energy demand. In contrast, Wall Street saw gains on Wednesday, with the S&P 500 hitting an intraday record high, driven by Netflix's strong quarterly report and Trump's private-sector AI infrastructure plan. Technology stocks, led by Nvidia and Microsoft, surged 2.5%, boosting market optimism. While U.S. markets benefit from robust earnings and technological investments, global markets face caution due to economic and policy uncertainties. 

FTSE 100 

The FTSE 100 closed at 8,545.13 on Wednesday, down by 0.04%, forming a bearish candlestick pattern. However, the overall bullish trend remains intact, as the index stays above its 21-period Simple Moving Average (SMA), suggesting potential short-term gains. The 50-period SMA offers additional support, strengthening the likelihood of continued upward movement. The Relative Strength Index (RSI) is at 71.05, indicating sustained bullish momentum. With these technical indicators, the FTSE 100 is likely to maintain its upward trajectory if key support levels hold, reinforcing a positive near-term outlook. On the weekly chart, the FTSE 100 rose 3.11%, closing at 8,505.22, above the 50-period SMA at 8,148.56. Key support is at 7,932, with resistance at 8,400. Breaking the 8,400 resistance signals stronger bullish momentum, potentially targeting the next resistance at 8,700. A drop below 8,020 could signal further downside. Monitoring these levels will be crucial for predicting future price movements. 

Data Source - EODHD/Others