Image Souce: Krish Capital Pty Ltd

Index Update: The FTSE 100 index, a key benchmark index for the London stock exchange, went up around 0.08% on 29 October 2024. Energy, Industrials & Technology sector demonstrated a substantial decline. Moreover, sectors such as Basic Materials, Financials, & HealthCare sector faced a significant growth.

Macro Update:  Shop prices in Britain dropped at their fastest pace in over three years, with an annual deflation rate of 0.8% in October, driven by declining non-food prices and retailers scaling back discounts. Food prices, however, rose by 1.9%, and clothing costs edged up slightly. Meanwhile, the British pound held steady, though implied volatility in sterling options rose as traders awaited the upcoming budget announcement from Finance Minister Rachel Reeves, expected to influence inflation. In other market news, HSBC reported stronger-than-expected Q3 profits driven by wealth and wholesale banking, sending its Hong Kong-listed shares up 3.7%, the highest level since 2018, following the announcement of a new share buyback plan.

Top Market Movers: Among top gainers on FTSE 100 index, HSBC Holdings PLC (LSE: HSBA) witnessed a rise of 4.35% followed by Antofagasta PLC (LSE: ANTO) which gained around 3.04%.

Commodity Update: On Tuesday, the dollar eased slightly but remained close to recent highs ahead of key U.S. economic data that could influence Federal Reserve policy. Solid U.S. economic indicators and potential political shifts, including stronger prospects for a Trump win, may support a higher dollar/yen in the coming weeks. In commodities, gold rose 0.25% to $2,762.75 per ounce, silver increased 0.10% to $34.04, while copper slipped 0.18% to $9,542.00 per ton. Brent crude futures climbed 0.7% to $71.94 a barrel, recovering after recent losses due to easing Middle East conflict concerns. Investors are closely watching upcoming GDP data and election developments.

Our Stance: With just over two months remaining in 2024, the S&P 500 is nearing a historic annual gain, with potential for its strongest performance since 2000. This rally, driven primarily by gains in tech-heavy stocks such as Nvidia, Alphabet, and Microsoft, has defied challenges like high-interest rates and geopolitical tensions. In global currency markets, the yen remains weak, as Japan’s recent election results introduced uncertainty about its economic and monetary policies. Meanwhile, the U.S. dollar strengthened ahead of key economic reports, which may influence Federal Reserve policy. A continued rally for the S&P 500, alongside a stable U.S. dollar, could attract more investor confidence in U.S. equities. Yet, with a rising dollar and expected interest rate adjustments, some volatility may be anticipated for both U.S. and global markets in the short term. In summary, while the S&P 500 is positioned for a strong annual close, investor sentiment will be closely tied to upcoming U.S. economic indicators, which could either solidify or dampen the index's gains.

FTSE 100

The FTSE index closed at 8,2485.62, marking a modest gain of 0.45%. A bullish candlestick pattern has emerged, accompanied by increased trading volume, indicating a slight strength among investors. The index started the day robustly at 8,318.34, remaining above the 21-period Simple Moving Average (SMA), which now serves as a support level. On the weekly chart, the 50-period SMA suggests a generally positive long-term outlook. The Relative Strength Index (RSI) sits at 51.85, reflecting slightly bullish momentum. The index recently tested the critical 8,400 resistance level, and a successful breakout above this could enhance overall market sentiment. Conversely, the 8,100 level continues to act as strong support. With the index trading within a tight range, any breakout could significantly impact the prevailing trend has context menu.

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