Technical analysis for FTSE 100 for 8th March 2024
British midcap stocks rose to fresh three-month highs on Thursday as lender Virgin Money soared on a possible buyout, while pest control firm Rentokil lifted blue-chip shares following a profit jump.
Shares of Virgin Money UK rallied 35%, their biggest percentage gain on record, after Nationwide Building Society agreed to buy the bank in a potential 2.9 billion pound ($3.7 billion) deal to create the country's second-largest savings and mortgage provider.
Data from mortgage lender Halifax showed British house prices rose for a fifth month in a row in February, echoing other signs of a recovery in the housing market.
The blue-chip FTSE 100 rose 0.2% but lagged continental European markets and Wall Street, where surging technology stocks led the main indexes to all-time highs. Investors mostly took comfort as the European Central Bank acknowledged the progress it had made in bringing down inflation.
ECB also lowers GDP forecast
Central bankers in Europe also lowered forecasts for gross domestic product (GDP) growth on Thursday. The Eurozone will now likely grow by 0.6% this year, compared to previous forecasts for 0.8%. Stronger growth will return in 2025 and 2026 though, the ECB said, as GDP climbs 1.5% and 1.6% respectively, “supported initially by consumption and later also by investment”.
Asia
Asian stocks rose to a seven-month peak on Friday, tracking global peers as investors cheered the prospect of an imminent rate easing cycle led by major central banks, keeping the dollar and Treasury yields under pressure.
Japan remained an outlier as expectations mount that the Bank of Japan (BOJ) could finally exit negative interest rates this month. That lit a fire under the yen and sent domestic bond yields rising. MSCI's broadest index of Asia-Pacific shares outside Japan peaked at 538.47 points in early Asia trade, its strongest level since August. It was last 1% higher, and was eyeing a weekly gain of nearly 2%.
FTSE 100 technical analysis for today, 8th March 2024
The FTSE100 stalled at 7713 yesterday but has tested 7715 overnight and of course we have NFP Friday today with the news forecasted to be a drop to 200k, with unemployment remaining the same at 3.7%.
The US markets have resumed their bullish momentum and the S&P500 has the 5200 level in its sights. Depending on the news today that will have a bearing on interest rates and if a cut is looming sooner rather than later.
The FTSE100 is also looking a bit more positive and as long as 7650 holds then the bulls may be able to consolidate above 7700. That said, the FTSE100 seems to be in its own little world, lagging other global indices and generally just treading water while others power north.
Initially today we may well see a dip down to the daily pivot level at the 7682 area and another test of the Hull MA here. The 10d Raff is also levelling off a little bit on todays daily chart as the bulls try and defend.
Below the daily pivot then 7638 is the next key area on the daily levels and 7634 is also the key fib, so should it get that low then a bounce here may well materialise. Ideally though I would like to see the daily pivot/30m 200ema at 7670 hold for an early rise. Buy the rumour sell the news ahead of NFP at 1300.
Resistance wise, then having tested 7715 now, albeit out of hours, the 7735 level is next up. We have daily resistance and the key fib both here so may well see a stutter here. Should we push above 7700 convincingly then the bulls will be trying to defend that and lock that in as support.
Above 7735 then 7756 R2 would be the next one to keep an eye out for though that may well be a big ask on a Friday.
Clocks change on the 10th in the US as well so next week will see the US markets opening at 1330 our time and last until our clocks change.
Good luck today and have a good weekend.
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