FTSE 100 live outlook prediction analysis for 29th April 2021
Banking and oil stocks helped to push the FTSE 100 back towards the 7,000 level as it ended the day up 18.7 points to 6,963.67. Lloyds was the second biggest riser among blue-chips after beating expectations with its first quarter figures. Shares gained 1.53p to 45.11p while NatWest, Barclays, HSBC and Santander all followed suit in the green.
Oil heavyweights Royal Dutch Shell and BP buoyed the top flight, adding 27p to £13.82 and 9.2p to 304.5p respectively. It came as oil prices firmed, with Brent crude rising 1.4pc.
Leading the index was advertising giant WPP after it reported a bounce back in sales as global brands started spending on marketing again. The firm said like-for-like revenues rose more than 3pc to £2.33bn during the first quarter compared to a year earlier. Analysts had forecast a 0.37pc fall. Shares gained 40.6p to 991.6p.
European woes
The eurozone is at risk of a “tsunami” of bankruptcies as Covid life-support schemes for businesses are wound up, regulators have warned.
A report by the EU’s key risk watchdog, which is chaired by European Central Bank president Christine Lagarde, said that companies may struggle to stay solvent the longer they relied on emergency financial support. This could cause debt to accumulate, increasing the risk of a pent-up wave of insolvencies, it warned. Companies in the bloc have claimed a total of €1.5 trillion (£1.3 trillion) in grants, tax deferrals and loans during the pandemic, the European Systemic Risk Board (ESRB) said.
Looking Up
Federal Reserve Chair Jerome Powell and his colleagues upgraded their assessment of the U.S. economy but said they were not yet ready to consider scaling back pandemic support. “Indicators of economic activity and employment have strengthened,” the Federal Open Market Committee said in a statement Wednesday after holding its key interest rate near zero and maintaining a $120 billion monthly pace of asset purchases. Growing optimism for the U.S. recovery has been helped by widening vaccinations and aggressive monetary and fiscal support. President Joe Biden will unveil on Wednesday a sweeping $1.8 trillion plan to expand educational opportunities and child care, hot on the heels of a $1.9 trillion pandemic relief plan and a proposed $2.25 trillion infrastructure plan.
Apple Crushes It
Asia stocks look set to climb at the open after the Federal Reserve’s assessment of the U.S. economy. The dollar retreated with bond yields. Futures pointed higher in Australia and Hong Kong, while Japan is closed for a holiday. All U.S. stock benchmarks ended lower, with the S&P 500 Index failing to hold gains on Jerome Powell’s assertion that asset purchases aren’t about to be trimmed. The central bank’s reiteration that inflation pressures are likely “transitory” helped Treasuries rally. An exchange-traded fund tracking the Nasdaq 100 Index jumped in late trading after Apple crushed Wall Street revenue estimatesand Facebook reported gains in sales and users. Alphabet rose to a record after its results showed a surge in ad sales, while Microsoft dropped after undershooting the blockbuster figures some analysts had anticipated.[Bloomberg]
US & Asia Overnight from Bloomberg
U.S. equity futures jumped Thursday and Asian stocks rose, buoyed by robust earnings from technology heavyweights and the prospect of further stimulus to fuel the economic recovery from the pandemic.
S&P 500 and Nasdaq 100 contracts were in the green, with the latter climbing as much as 1% after Apple Inc. crushed revenue estimates and Facebook Inc. reported increases in sales and users. In South Korea, Samsung Electronics Co. beat analyst profit forecasts but warned of further fallout from chip shortages. Hong Kong stocks led Asia higher. Japan is shut for a holiday.
In his first address to Congress, President Joe Biden laid out a $1.8 trillion social-support plan. The package of tax credits and domestic priorities — including child care, paid family leave and tuition-free community college — would be funded partly by the largest tax increases on wealthy Americans in decades.
The dollar held at lows after the Federal Reserve signaled it’s not ready to consider scaling back policy support. The Fed said it will continue with asset purchases and described inflation pressures as likely “transitory.” Australia’s 10-year bond yield retreated, following a Treasuries rally in U.S. hours.
Investors are looking for catalysts to spur the bullish momentum in equities. The Fed offered no fresh cues, though the pledge to keep policy loose is helping to support risk appetite. The growth boost from monetary and fiscal stimulus has raised market expectations for inflation and interest rates.
FTSE 100 Outlook | Trading Signals | Forecast | Prediction | Analysis
The bulls nearly managed the 6995 level yesterday, stalling at 6986 instead but looks primed for a test of 7000 today. Especially if the S&P can hold above 4200 for the moment and get a rise towards R3 at 4225 today. We may even manage to get R2 and the key fib at 7012. Of course we do still have the 6995 daily level in play but we may well see the upward momentum push through that this morning. The 30m chart is bullish to start with and daily pivot at 6964 is initial support.
Above the 7013 level then we have the top of the 10 day Raff channel at 7037 and aligning with R3 so should we get this high then we may well see the bears appear here. Last day of the month tomorrow as well which may well see some profit taking ahead of a usually choppier May trading month.
For the bears they will be looking to push down towards the 6950 level where we have the 200ema on the 30m chart, and also the green 2h coral line. I would like to see this hold, certainly initially, otherwise the bears may well be taking it down to the daily support at 6900 `and half way between S2 and S3.
Below that then we would likely get a test of the 20 day Raff at 6873 though not sure we get 100 point slide today but never say never!
Not much more to say really, momentum is still up though it does feel like its waning a bit. As such be cautiously bullish today and watch for the 7013 and 7040 areas as resistance. 6950 for decent support.
Good luck today.
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