Image Souce: Krish Capital Pty Ltd

Index Update: The FTSE 100 index, a key benchmark index for the London stock exchange, went up around 0.58% on 24 October 2024. Consumer Non-Cyclicals, Energy & Basic Materials sector demonstrated a substantial growth. Moreover, sectors such as Industrials, Utilities and Consumer Cyclicals faced a significant growth.

Macro Update:  British finance minister Rachel Reeves will present a budget aimed at resetting the economy and boosting investment, coinciding with her attendance at the International Monetary Fund and World Bank meetings in Washington. This budget marks the Labour Party's first in 14 years. Meanwhile, British businesses reported their slowest growth in 11 months in October, with the services and manufacturing sectors both showing declines due to uncertainty around the upcoming Labour budget. The S&P Global PMI fell to 51.7, its lowest since November 2023. In political shifts, South West Norfolk saw a historic swing from the Conservatives to Labour, with Sue Bogacki expressing regret over her support for Labour after witnessing significant political upheaval. Additionally, yields on British government bonds rose, reflecting market concerns about potential increased borrowing in the upcoming budget, which could impact future Bank of England interest rate cuts.

Top Market Movers: Among top gainers on FTSE 100 index, Anglo American PLC (LSE: AAL) witnessed a rise of 4.26% followed by Unilever PLC (LSE: ULVR) which gained around 3.53%.

Commodity Update: The U.S. dollar approached a three-month high against major currencies, driven by expectations of a slower pace of interest rate cuts by the Federal Reserve and rising speculation about a potential second Donald Trump presidency. In the commodities market, gold rose 0.23% to $2,735.70 per ounce, silver climbed 0.59% to $34.03 per ounce, and copper increased 0.63% to $9,570.00 per ton. Brent crude futures gained 1% to $75.72 a barrel amid heightened tensions between Israel and Iran. Meanwhile, oil prices fell on Wednesday due to higher-than-expected U.S. crude stockpiles, with upcoming business activity data closely watched.

Our Stance: European shares edged up slightly on Thursday, supported by positive earnings reports and a focus on upcoming PMI readings. These readings are expected to reflect contracting business activity in the eurozone, which may push the European Central Bank (ECB) towards further rate cuts. European traders are closely watching these economic indicators, as they will shape the ECB's future monetary policy. Global markets remain in a state of cautious optimism. While positive earnings in sectors like tech (Tesla) and European travel have provided short-term relief, broader concerns about weak economic activity in Europe and political uncertainty in the U.S. continue to loom large. Investors are likely to remain cautious, particularly as key economic data like PMI readings and election outcomes could influence central bank decisions and market movements.

FTSE 100

On the daily chart, the FTSE index closed at 8,258.64, down 0.58%, forming a bearish candlestick pattern with increased trading volume, signalling a slight decline in investor confidence. Index Opening at 8,282.00, the index initially displayed strength but has since remained above the critical 21-period Simple Moving Average (SMA), a key support level. The 50-period SMA on the weekly chart suggests a generally positive long-term outlook. The Relative Strength Index (RSI) stands at 51.49, indicating modest bullish momentum. Following a recent test of the 8,400 resistance level, a breakout above this could enhance market sentiment, while 8,100 remains a strong support level. The index's narrow trading range means any breakout could have a significant impact on the prevailing trend.

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