FTSE 100 live outlook prediction analysis for 14th October 2020
- Unemployment rate hits 4.5pc in August, higher than expected
- Andrew Bailey : ‘The hard yards are still ahead of us’
- Covid-19 pushes jobless rate to three-year high after record cull
- Payroll count edges higher in September, ending eight months of falls
- Benefit claimant count continues to climb, up 120pc since March
- Alcohol sales jump after 10pm curfew begins
- FTSE and Wall Street slide Tuesday
Unemployment in the UK jumped to 4.5pc in the three months to the end of August as the labour market came under increasing pressure. The rise – up from the 4.1pc rate to the end of July – was sharper than economists had expected, and came amid a drop in employment and continued rise in benefit claims.
The FTSE 100 ended the day about 0.5pc lower at 5,969 points, with Rolls-Royce again taking the wooden spoon, although a tenth of the index shed more than 3pc. Both the Dow and S&P fall to end a four-day winning streak. The pause in Johnson & Johnson’s Covid vaccine trial appears to have elevated concerns about a full economic rebound from the coronavirus-led downturn.
Trials Paused
Eli Lilly has paused enrollment of participants in a clinical trial of its antibody treatment for Covid-19 due to a potential safety concern. The company didn’t provide information about why an independent data safety monitoring board recommended the pause, which pushed down the company’s shares. Earlier, Johnson & Johnson paused its Covid-19 vaccine trial because of a participant’s unexplained illness. Lilly is one of several companies developing antibody therapies, including Regeneron Pharmaceuticals. Both Lilly and Regeneron are now seeking emergency authorization of the treatments.
Market Open
Asian stocks were set for modest declines after American equities slipped, with little sign for a quick end to the stalemate over fresh U.S. fiscal stimulus. Treasuries and the dollar climbed. S&P 500 futures opened flat after banks led losses on Tuesday. Equity futures were lower in Japan and Australia. Hong Kong’s markets are expected to resume after a tropical storm forced closures on Tuesday. Crude oil advanced, while gold retreated. Traders will be watching a speech from Chinese President Xi Jinping in Shenzhen on Wednesday, where he is expected to lay out a vision for the region’s growth.[Bloomberg]
FTSE 100 Outlook | Trading Signals | Forecast | Prediction | Analysis
Asian stocks trended lower Wednesday as the American earnings season began and with no sign of a quick end to the stalemate over U.S. fiscal stimulus. Treasuries and the dollar were steady.
Hong Kong equities dipped as trading resumed after closures Tuesday due to a tropical storm. China Evergrande Group shares slumped after the embattled developer raised less than anticipated in a share sale. A speech from China President Xi Jinping in Shenzhen on Wednesday where he laid out a broad vision for the region’s growth provided little in the way of market-moving news.
Losses were modest across the region, and U.S. and European futures ticked up. The won was little changed after the Bank of Korea kept its key interest rate on hold as expected. Crude oil dipped.
The bulls struggled to defend the 6000 level as the S&P also continued to slip from the 3550 level. It did however defend the 3500 level, and the FTSE defended 5960 25ema level that we had yesterday. As such, we may well see some bullishness remain for the moment, however the 30min FTSE chart has strong resistance at the 6025 level with the key fib and R1 here, and also that is just above the red coral on the 2h chart now. As such, we may well see a rise and dip play out today, though the bulls will I am sure not give up too easily.
The line in the sand on the FTSE remains at the 5930 level that held as support last week and we may well see a defence of that if we drop down there. We also have S1 and the key fib just above this at 5945 and 5941 respectively.
The daily chart remains bullish with that 5963 25ema still in play, but the more it’s tested the more the likelihood it’s going to break. 5910 is the 10 day Raff though so we could see a hold of this level if it dips below 5930. If the S&P defends the 3500 level again, it may well align with this and we see a spring back up. The S&P bulls will want to target 3550, possibly 3580.
Below the 5910 level we would be on for a slide down to 5890 and possibly 5860.
Above 6025 today and we should see yet another test of the 6040 level, and above this then 6100 is the next main level to watch for, with the top of the 20d Raff at 6117 above that.
We could be on for another interesting one today. Golds’ drop yesterday could of course be front running a rise in indices. The stalling of the vaccine development by J&J and Eli has weighed on markets but I imagine a scalable, successful vaccine is still several months away yet. Good luck today.
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