FTSE 100 INCHES DOWN AHEAD OF BREXIT SUMMIT; GDP OUTPERFORMS
FTSE 100 futures are currently trading at 7353-higher by 0.04% as compared to the previous closing. The contract, however, closed in the negative territory in the last trading session.
In the cash markets, the blue-chip share index inched down 0.18% to 7,411.84 at the time of writing. The benchmark index today held steady as traders remained cautious in light of a new U.S.-EU trade fight and before a Brexit summit.
The midcap index FTSE 250 was up 0.14% at the time of writing.
Markets were trading cautiously due to a transatlantic aircraft subsidy dispute, with the U.S. threatening to slap tariffs on $11 billion worth of European Union products.
European leaders today will hold an emergency summit in Brussels to decide whether to offer Britain another delay to the Brexit process. Leaders are likely to grant British PM Theresa May a second delay but could demand an extension beyond 30th June.
U.S. Justice Department accused drugmaker Indivior of illegally boosting prescriptions for the film version of its blockbuster opioid addiction treatment Suboxone. Due to this, index-member Reckitt Benckiser declined 4.92%.
British engine maker Rolls-Royce fell 0.89% after it agreed to an early inspection of some Trent 1000 TEN engines by regulatory authorities, after the re-emergence of issues related to blade deterioration.
Index-component HSBC which has greater exposure to China was down 0.31% at the time of writing.
Exporters felt the brunt of a stronger pound. The pound rose after GDP came in above expectations. British American Tobacco, GlaxoSmithKline, and Unilever were trading in negative territory at the time of writing.
On the other hand, Britain’s biggest retailer Tesco gained 1.82% after reporting a better-than-expected 34% rise in its full-year operating profit earlier today.
On the economic front, U.K. GDP data for February was released on Wednesday. The YoY rate of change in the GDP was +2.0%. The GDP growth was above the market expectation of 1.7%. In addition, Manufacturing Production (MoM) for February also out today came in at 0.9%. The Production change was above the consensus estimates of 0.2%.
On the technical front, the RSI is currently at 64.53% and suggests that the market can continue trading sideways. The current price is below the MA5. The %K has crossed the %D from above to the downside at around 94% and suggests that the market can move in the downward direction.
Overall Bias is negative and short-term trades can be initiated with below mentioned Stop Loss and Profit targets.
Trade Suggestion- Limit Sell at 7360. Take Profit at 7320. Stop Loss at 7380