Image Souce: Krish Capital Pty Ltd

Index Update: The FTSE 100 index, a key benchmark index for the London Stock Exchange, was flat around -0.01% on 06 December 2024. Real Estate and Energy demonstrated substantial growth. Moreover, the Utilities and Consumer Cyclicals sectors faced a significant decline. 

Macro Update:  British house prices surged by 1.3% in November, the largest monthly increase since June 2022, reaching a record £298,083 and marking a 4.8% annual rise, the highest in two years, according to Halifax. However, affordability challenges for buyers remain. Meanwhile, Britain's trade minister signaled caution regarding potential retaliatory measures in response to Donald Trump’s incoming administration, which has proposed sweeping import tariffs. The Confederation of British Industry (CBI) downgraded its 2025 growth forecast to 1.6%, citing cost pressures from the new government’s budget and ongoing strain on profit margins. In corporate news, Aviva agreed to acquire Direct Line for £3.61 billion in a cash-and-stock deal, creating the UK's largest home and motor insurer. 

Top Market Movers: Among top gainers on FTSE 100 index, B&M EUROPEAN VALUE RETAIL S.A. (LSE: BME witnessed a rise of 2.05% followed by JD SPORTS FASHION PLC (LSE: JD.) which gained around 2.2%. 

Commodity Update: Major currencies held steady on Friday as markets reflected on a turbulent week marked by the collapse of France's government and brief martial law in South Korea. Bitcoin paused after surging above $100,000, with even sceptics anticipating that a crypto-friendly Trump administration could fuel further gains. The U.S. non-farm payrolls report for November took centre stage as investors speculated on the pace of potential Federal Reserve rate cuts. In commodities, gold slipped 0.04% to $2,647.20, silver rose 0.30% to $31.63, and copper climbed 0.23% to $9,115.50. Brent crude edged lower by 0.10% to $72.00 amid concerns over weak demand and OPEC+ supply cuts, extended through 2026.. 

Our Stance: Global markets are in a cautious stance, with investors closely monitoring U.S. payrolls data to gauge the likelihood of a Federal Reserve rate cut this month. European stocks made modest gains, but Britain's FTSE 100 remained flat, weighed down by Aviva's announcement of a £3.6 billion acquisition of Direct Line. The euro weakened amid speculation that the European Central Bank might favor further depreciation to address subdued growth and trade risks, potentially leading to deeper interest rate cuts. In Asia, markets were mixed; South Korean political turmoil pressured shares, while Chinese markets climbed on optimism about upcoming economic policy announcements. Meanwhile, oil prices declined as OPEC+ extended output cuts until 2026, reflecting concerns over weak demand. 

FTSE 100 

The FTSE 100 closed at 8,349.38, marking a 0.16% increase and forming a bullish candlestick pattern that reflects strong investor sentiment. The index continues to trade above its 21-period and 50-period Simple Moving Averages (SMAs), indicating solid support and the potential for further upward movement. The Relative Strength Index (RSI) stands at 63.53, suggesting continued bullish momentum with room for additional gains without signalling overbought conditions. 

On the weekly chart, the FTSE 100 finished at 8,287.30, up 0.31%, after bouncing from the 21-period SMA at 8,241.06, reinforcing a positive outlook. Immediate resistance is at 8,400, with a breakout above this level likely to fuel further bullish momentum. However, if the index falls below 8,020, there could be downside risks and consolidation. Investors should monitor these key levels for potential market direction. 

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