Image Souce: Krish Capital Pty Ltd

Index Update: The FTSE 100 index, a key benchmark index for the London stock exchange, was flat at 0.04% on 14 November 2024. Basic Materials, Industrials, & Technology sector demonstrated a substantial decline.  

Macro Update:   In October, British house prices saw their fastest rise in over two years, with the RICS house price balance increasing to +16 from +11 in September, reflecting pre-budget sentiment before finance minister Rachel Reeves' October 30 budget announcement with tax and spending hikes. Burberry, facing financial challenges, announced a refocus on its classic British heritage products and a £40 million cost-saving initiative under new CEO Joshua Schulman. Additionally, Reeves outlined a major UK pension reform plan to generate up to £80 billion in new investment through "megafunds" to tackle underinvestment in domestic assets. Meanwhile, up to 2,000 jobs are at risk at Homebase after a restructuring deal secured 1,600 jobs through a partial sale. 

Top Market Movers: Among top gainers on FTSE 100 index, B&M EUROPEAN VALUE RETAIL S.A. (LSE: BME) witnessed a rise of 4.56% followed by SPIRAX GROUP PLC (LSE: SPX) which gained around 4.16%. 

Commodity Update: The U.S. dollar reached a one-year high against major currencies on Thursday, continuing a fourth consecutive day of gains driven by momentum from Donald Trump's election victory, overshadowing rising expectations for Federal Reserve rate cuts. In commodities, gold dropped 0.70% to $2,568.40 per ounce, silver declined 1.27% to $30.26, and copper fell 0.59% to $8,962 per ton. Brent crude slipped 0.1% to $72.23 amid weak U.S. inventory data, while markets awaited further demand signals from China and the International Energy Agency. Oil prices remained under pressure after OPEC reduced its demand forecast for the fourth month. 

Our Stance: In October, U.S. consumer prices rose as expected, primarily due to increased shelter costs, according to a Labor Department report. This suggests a slowdown in inflation progress, which may influence the Federal Reserve to limit rate cuts next year. Despite a projected rate cut in December, underlying inflation remains warm, reflecting the challenges of a cooling labor market. Asian stocks dropped on Thursday as investors weighed the implications of U.S. monetary policy and inflation. Meanwhile, U.S. bond yields rose, bolstering the dollar to a one-year high against other currencies. Bitcoin remained strong, trading above $90,000 following Donald Trump’s election victory, with markets optimistic about his administration’s impact on cryptocurrency, leading to a recent 30% rise in Bitcoin’s value. 

FTSE 100 

The FTSE 100 closed at 8,033.33, up 0.06%, showing a bullish candlestick pattern with rising volume, indicating growing investor caution. The index opened at the same price as the previous close, which adds to the optimistic sentiment in the market. However, it is still trading below its 21-period Simple Moving Average (SMA), acting as resistance and limiting short-term upside potential. The Relative Strength Index (RSI) at 34.07 suggests the index is approaching oversold conditions, hinting at either further downside or a potential reversal if market conditions improve. 

On the weekly chart, the 50-period SMA provides support near 8,020, a critical level to watch for stabilization. Immediate resistance is at 8,400; a breakout above this could signal a bullish shift. Conversely, a drop below 8,020 could trigger further declines, possibly testing support at 7,932. 

Key levels to monitor: resistance at 8,400 and support at 8,020. These levels will be crucial in determining whether the FTSE 100 continues to consolidate or faces further weakness. 

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