FTSE 100 Holding Support above 8,200 levels amidst Corporate Earnings:

Image Souce: Krish Capital Pty Ltd

Index Update: The FTSE 100 index, a key benchmark index for the London stock exchange, went up around 0.01% on 27 November 2024. Energy, Utilities & Consumer Cyclicals sector demonstrated a substantial decline. Moreover, sectors such as Consumer Non-Cyclicals, Real Estate & Basic Materials faced a significant growth. 

Macro Update:  EasyJet expects a 3% capacity increase in fiscal 2025 despite reporting a lower-than-expected annual operating profit due to disruptions from the Middle East conflict. The UK competition regulator affirmed that loyalty schemes, like Tesco’s "Clubcard Prices" and Sainsbury's "Nectar Prices," offer genuine savings for members, enhancing their appeal. British government bond yields fell to post-budget lows, mirroring a dip in German bonds, with 5- and 10-year gilt yields dropping over 5 basis points. Nationwide Building Society reported a significant £2.3 billion gain from its Virgin Money acquisition, but its statutory profit before tax fell 43% to £568 million due to narrowing margins and higher payouts to members. 

Top Market Movers: Among top gainers on FTSE 100 index, Anglo American PLC (LSE: AAL) witnessed a rise of 2.23% followed by Vistry Group PLC (LSE: VTY) which gained around 1.98%. 

Commodity Update: The U.S. dollar remained stable against major currencies on Wednesday as investors digested President-elect Donald Trump’s tariff proposals while awaiting key U.S. inflation data. In the commodities market, gold saw a 0.69% increase, reaching $2,664.70 per ounce, and silver rose by 0.50%, trading at $30.98 per ounce. Copper surged by 0.44%, hitting $9,014.50 per ton. Meanwhile, Brent crude dropped slightly by 0.01%, settling at $72.79 per barrel as markets weighed the impact of a potential ceasefire between Israel and Hezbollah, with attention also focused on Sunday’s OPEC+ meeting and upcoming U.S. GDP data for further guidance. 

Our Stance: European markets faced headwinds on Wednesday as the STOXX 600 declined by 0.2%, largely weighed down by auto stocks reacting negatively to proposed U.S. trade tariffs. French equities underperformed, with the CAC 40 index falling 0.7% due to a sharp sell-off in major banks like BNP Paribas, Societe Generale, and Credit Agricole, down 2-2.6%, amid concerns over the new government’s austerity measures. Meanwhile, oil prices edged higher, reflecting market anticipation of a potential OPEC+ decision to delay production increases and a ceasefire agreement between Israel and Hezbollah. The dip in European markets highlights heightened sensitivity to geopolitical and domestic fiscal concerns. Investors remain cautious, particularly in France, where uncertainty over the government's fiscal strategy has amplified bond yield spreads. The auto sector's vulnerability to trade tensions further underscores the risks posed by protectionist policies. Meanwhile, oil market dynamics suggest that geopolitical stability and OPEC+ decisions will play a critical role in shaping near-term price trajectories, with potential upside if output increases are delayed. 

FTSE 100 

The FTSE 100 closed at 8,258.61, down 0.40%, forming a bearish candlestick pattern. However, despite this formation, investor sentiment remains strong. The index is trading above its 21-period and 50-period Simple Moving Averages (SMAs), which now serve as key support levels, suggesting the potential for further gains. The Relative Strength Index (RSI) stands at 57.59, indicating bullish momentum and the possibility of the uptrend continuing. On the weekly chart, the index closed at 8,262.08, up 2.62%, after bouncing off the 50-period SMA at 8,047.08, with additional support at 7,932. Immediate resistance is seen at 8,400, and a breakout above this level could signal a bullish reversal. Conversely, a decline below 8,020 could indicate further downside risk. Investors should closely monitor these key support and resistance levels for signs of consolidation or continued upward momentum.