FTSE 100 Analysis | Signals | Forecast | Prediction | FTSE 100 Outlook | Trading help
Stocks in global markets rose on Thursday as U.S. Treasury yields fell to two-week lows, while copper was at 16-month lows as investors worried about a possible global economic slowdown.
The FTSE 100 ended Thursday in the red though following a selloff in oil and mining majors due to tepid commodity prices on persisting concerns about a global recession. The blue-chip index dropped 1% to 7,020, with oil majors BP and Shell leading losses. Shares of miners Anglo American, Rio Tinto and Glencore weakened as copper prices tumbled to a 16-month low.
The technology sector spurred a climb in stocks Friday and bonds held a rally as investors evaluated economic threats and scaled back expectations for inflation and interest-rate hikes.
An Asian equity index rose for a second day, aided by Chinese tech shares, while S&P 500 and European futures pushed higher. US shares closed near session highs Thursday, adding more than 3% in three days.
Stocks and bonds were both headed for their first weekly gain in a month on Friday as investors wagered on central banks bringing inflation to heel, though growth fears dragged on commodities.
Copper, a bellwether for economic output with its wide range of industrial and construction uses, slid 3% in Shanghai and is down more than 7% for the week – its sharpest weekly fall since the pandemic-driven financial markets meltdown in March 2020.
Oil also fell overnight, and Brent crude futures are down 2% on the week to $110.62 a barrel, while benchmark grain prices sank with Chicago wheat off nearly 9% for the week and at its lowest since March at $9.42 a bushel.
The price falls have made for some relief in equities since energy and food have been the drivers of inflation. After some heavy recent losses, MSCI’s World equities index is up 2% on the week.
MSCI’s broadest index of Asia-Pacific shares outside Japan rose 1% on Friday, flattered by short sellers bailing out of Alibaba – which rose 5% – amid hints that China’s technology crackdown is abating.
Japan’s Nikkei rose 0.8% for a 1.6% weekly gain and S&P 500 futures were flat after the index rose about 1% overnight. The U.S. dollar is hovering just below a two-decade high against a basket of major currencies
History Books
The S&P 500 Index may have another 24% to fall by year-end, if the past 150 years of financial-market history are any guide. That’s according to Societe Generale, which calculates the benchmark gauge may need to tumble as much as 40% from its January peak in the next six months to hit bottom.
FTSE 100 live outlook prediction analysis for 24th June 2022
The bulls will once again try to build on their recent strength though the drop off 7115 yesterday will have dented their confidence a bit! That said, overnight we have been helped by the S&P500 futures breaking above 3800 and that remains on track for the 3845 R2 level for today, which should help pull the FTSE100 up again.
Initial resistance is at the 7085 level where we have the 200ema and the key fib to start with, so we could well see a dip and rise play out today. Similar pattern to the ASX200 in fact. That put in a decent rise after its early wobble so if we did do similar then we may well see test of the next key resistance at the 7155 level where we would test the 10d Raff channel top. That would end the week fairly positively as well.
Above 7155 we have R2 at 7169, then R3 at 7220, with the 20d Raff at 7200 splitting those.
For the bears the support to start with is 7030 with the green 30m coral here, and just below the daily pivot level of 7043. The bears managed to drive it all the way down to 7100 yesterday from the 7115 level (bit early banking at 7040!) and will try again today no doubt. However I am thinking that we will see this 7030 level hold. It would be the first test of the 30m coral since its gone green as well.
Below that though and the key fib is at 6986 and then S1 at 6968. Sustained moves (and a hold) below 7000 though and that keeps the bigger bearish picture alive and well, and having lulled many into believing that 7000 is forming a base, will likely turn the screws!
That said, a dip and rise fits pretty well with the S&P and the Dax as well – 3790 and 12950 respectively being the key supports to watch today on them.
Be slightly more cautious today as it’s Friday, but have a great weekend and good luck today!
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