Markets Waver on Policy and Geopolitical Risks as UK Faces Retail Slump:

Image Source : Krish Capital Pty Ltd

Index Update: The FTSE 100 index, a key benchmark index for the London stock exchange, went up around 0.11% on 20 June 2025.  

Macro Update: UK retail sales volumes dropped 2.7% in May, the steepest fall since December 2023, following a surge in spending the previous month. Lawmakers are set to vote on legalising assisted dying, a major social reform still in early stages. Public borrowing came in at £17.69bn in May, putting the UK’s deficit below forecasts for the fiscal year so far. BoE Governor Andrew Bailey questioned the need for retail digital currencies, citing a lack of clear benefits. The FTSE 100 rose 0.5%, supported by a U.S. delay in deciding on Middle East involvement, though geopolitical risks persist. Meanwhile, Berkeley Group shares fell 8% after announcing a leadership change and weaker profit outlook for FY26–FY27. 

Top Market Movers: Among top gainers on FTSE 100 index, Melrose Industries PLC (LSE: MRO) witnessed a rise of 3.39% followed by Standard Chartered PLC (LSE: STAN) which gained around 2.52%. 

Commodity Update: The dollar is poised for its biggest weekly gain in over a month amid heightened Middle East tensions, driving demand for safe-haven assets. Gold dropped 1.04% to $3,372.40, silver slid 1.55%, and copper eased 0.10%. Brent crude fell 1.90% to $77.33 after the White House said President Trump would decide on Iran-Israel war involvement in two weeks, though crude remained on track for a third consecutive weekly gain. 

Our Stance: Global markets remain cautious amid rising geopolitical tensions and economic uncertainty under President Trump’s second term. The Federal Reserve has paused rate cuts and adjusted its inflation outlook upward, citing tariff concerns and policy unpredictability. While stock markets edged higher as Trump delayed a decision on U.S. military involvement in the Israel-Iran conflict, the situation remains fluid and risks persist. The dollar strengthened on safe-haven demand, while gold fell on reduced fears of immediate conflict. Emerging markets rebounded slightly as the threat of near-term U.S. intervention eased, but investor sentiment continues to hinge on geopolitical developments and the Fed's policy stance. 

FTSE 100:  The FTSE 100 is trading at 8,840.34, rising 0.55%, as it approaches resistance while taking support from the 21-day SMA. The index remains above its 50-day SMA, indicating sustained bullish momentum. The RSI at 59.13 signals steady strength, pointing to potential short-term consolidation. Immediate support lies at 8,750; holding this level could support further upside, while a breach may lead to a minor pullback. Market sentiment remains guided by sector rotation and global macroeconomic factors. As long as key support levels are intact, the broader trend for the FTSE 100 remains positive in the near to medium term.​  

FTSE 100 Technical Chart, Source - EODHD/Others