FTSE 100 live outlook prediction analysis for 23rd October 2020
- Chancellor launches further support for businesses
- Employer contribution to wage top-up cut
- Cash grants for businesses in Tier 2 areas
- More support for self-employed
- Sunak offers backdated support to hospitality and leisure sector
- Two-fifths of hospitality firms warn of substantial risky of insolvency
- FTSE 100 flat as European markets fall
Remdesivir Ready
Gilead Sciences’s antiviral therapy remdesivir on Thursday became the first drug to obtain formal clearance from the U.S. Food and Drug Administration for treating the coronavirus. Regulators had granted an emergency-use authorization for remdesivir earlier this year, and it was given to President Donald Trump this month when he was diagnosed with the virus. The approval of remdesivir, sold under the brand name Veklury, could help solidify its position as the go-to medicine for Covid-19 patients even when other drugs begin to reach the market. Meanwhile, the seven-day average of U.S. deaths on Wednesday hit the highest in a month, and the outbreak is accelerating in Europe.
Markets Mixed
Treasury yields rose and bank shares lifted U.S. equities as lawmakers in Washington continued to haggle over a spending bill. Asian stocks looked set for a mixed start as traders readied for the final presidential debate. Futures edged higher in Japan, and were little changed in Hong Kong and Australia. The S&P 500 earlier pared its weekly decline as financial stocks rallied almost 2%. The 10-year Treasury yield popped to 0.84%, its highest since June, amid data showing the labor market is still gradually recovering. The dollar strengthened.
“Just About There”
House Speaker Nancy Pelosi said she and Treasury Secretary Steven Mnuchin are “just about there” on resolving a key piece of a coronavirus relief package. They were nearing agreement on how to allocate money for testing and tracing to safely reopen schools and the economy, she said. Still, they haven’t settled three main sticking points: Democrats’ demands for aid to state and local governments, school funding and Republican insistence on a liability shield for employers. Pelosi and Mnuchin were scheduled to talk by phone again Thursday afternoon, but as of 4 p.m. in Washington the call hadn’t taken place.[Bloomberg]
FTSE 100 Outlook | Trading Signals | Forecast | Prediction | Analysis
U.S. equity futures were steady with Treasury yields, while Asian stocks edged higher, as traders digested the final presidential debate and lawmakers in Washington continued to haggle over a spending bill.
S&P 500 contracts fluctuated while shares in Japan, China, South Korea and Hong Kong saw modest gains on subdued volumes. President Donald Trump and former Vice President Joe Biden debated topics including the response to Covid-19, immigration policy and health-care reform. The 10-year Treasury yield steadied around 0.85% amid data showing the labor market is still gradually recovering. The dollar was little changed. Intel Corp. tumbled in after-hours trading after a tepid forecast.
The bulls fought back yesterday and the S&P now needs to break above the 3462 level as that has become resistance overnight. We may well see a dip and rise play out today, as following the rises yesterday the 2 hour charts on Dax, Sp and FTSE are all bullish. Support 12538, 3429 and 5780 respectively. We may well get yet another end of day pump on the US markets this evening as they have a habit of doing that!
For the FTSE 100 the bulls need to break above the 5820 level as we have initial resistance here. Above this then 5872 is R2 and also the daily resistance level of 5865 is the next zone to watch. The daily FTSE chart remains bearish for the moment and the bulls need to break above 5907 where we have the 25ema for the moment. We also have the top of the 10 day Raff channel here, but the bulls will be looking for a strong weekly close today if possible. We had the last Presidential debate yesterday, much the same as previously – lots of talk, not a lot of substance.
For the bears, they need to break below the initial support at 5777. This looks a good level to go long from as we have the green 30min coral here, along with the daily pivot. A build on yesterday’s rise and an ultimate move and hold above the 5800 level today would fit quite well. Cable continued to drop overnight, having shot up to the 13160 level on the positive Brexit news on Wednesday. If that continues to slide then we should see the FTSE start to climb back.
If the bears break below 5775 then 5740 is next up in fairly short order I suspect, as we have S1 and the key fib level here. One would hope to see a reaction here so that yesterdays rise is not completely undone, however if the bears do get control then a further slide to the bottom of the 20 day Raff again at 5713 would be highly likely.
So, expecting a dip and rise to play out today, with the US bulls likely to consolidate a bit then push up during their session. But its Friday so anything can happen really! Watch for 5777 and 5740 support. 5820 and 5865 as resistance for today. Have a good weekend.
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