Global markets drop amid Middle East tensions and uncertain U.S.-China trade talks:

Image Source : Krish Capital Pty Ltd

Index Update: The FTSE 100 index, a key benchmark index for the London stock exchange, went up around 0.12% on 12 June 2025.  

Macro Update: Britain's economic output fell 0.3% in April, driven by U.S. tariffs and the end of a property sales tax break, marking the largest drop since October 2023. In response, Finance Minister Rachel Reeves prioritized health, defense, and infrastructure spending to stimulate growth and support working-class interests. Tesco reported stronger-than-expected sales growth, increasing its market share, but maintained cautious profit guidance. Meanwhile, British government bond yields dipped to their lowest levels in over a month following disappointing GDP data, and KPMG faced a £1.25 million penalty for failing to meet audit independence requirements in its audit of Carr’s Group. 

Top Market Movers: Among top gainers on FTSE 100 index, Halma PLC (LSE: HLMA) witnessed a rise of 4.57% followed by BT Group PLC (LSE: BT.A) which gained around 2.99%. 

Commodity Update: The dollar slipped on Thursday as expectations of Fed rate cuts grew and President Trump signalled a softer stance on tariffs, suggesting a possible extension of the July 8 trade deadline. Gold rose 1.57% to $3,396.00, silver gained 0.49% to $36.43, and copper advanced 0.44% to $9,693.10. Brent crude edged up 0.20% to $69.92 on fears of supply disruption amid rising tensions with Iran. 

Our Stance: Global markets have been volatile as rising Middle East tensions and concerns over the fragility of U.S.-China trade talks triggered a pullback in stocks. The S&P 500 ended lower, influenced by news of a potential partial U.S. embassy evacuation in Iraq amid escalating security risks, while Chinese and Hong Kong stocks also dropped, with the tech sector leading losses. The U.S. dollar weakened further, nearing a three-year low, as investors sought safe-haven assets. Although a report on U.S. inflation showed limited price pressures in May, economists warn that inflation may rise as the effects of U.S. tariffs are felt more broadly. 

FTSE 100: The FTSE 100 is trading at 8,843.64, down 0.23%, yet maintaining a bullish trend above its 50-day SMA, reflecting ongoing strength in the broader market. The RSI at 65.78 indicates firm momentum, though it edges closer to overbought territory, hinting at a potential short-term pullback or consolidation. Investor sentiment remains upbeat, largely driven by optimism in AI and tech-related sectors. Key support lies at 8,750—holding above this level could pave the way for renewed upside. However, a breach below may trigger a brief correction. Sector rotation could influence near-term moves, but the overall outlook remains constructive .​ 

FTSE 100 Technical Chart, Source - EODHD/Others