FTSE 100 RISES ABOVE MA5 AFTER PARLIAMENT VOTES ON BREXIT
FTSE 100 futures are currently trading at 6874-higher by 1.20% as compared to the previous closing. The contract closed in the positive territory in the last trading session also.
In the cash markets, FTSE 100 rose 1.91% to 6964.13 at the time of writing. Almost every sector was in positive territory, led by heavyweight energy and mining shares. The broad-market index rose today after a sharp fall in sterling overnight when British lawmakers voted down a proposal in parliament that aimed to prevent a potentially chaotic no-deal Brexit.
The midcap index FTSE 250 was up 0.59% at the time of writing.
Among index members, companies which have their earnings in Dollar rose today. British American Tobacco climbed 4.2% while GlaxoSmithKline, Diageo and Imperial Brands all gained more than 1.6%,
Combined with gains in oil majors BP (rose 1.4%) and Royal Dutch Shell (rose 2.5%) on higher crude prices, that helped the benchmark outperform European peers where caution dominated ahead of U.S.-China trade talks and the Federal Reserve’s policy guidance.
Luxury brand Burberry also advanced 2.6% after Paris-listed rival LVMH’s strong results lifted some of the gloom around the luxury sector.
On the other hand, Car dealer Auto Trader Group PLC was among the few decliners, dipping over 0.42%.
British parliament on Tuesday rejected a proposal to give parliament a path to prevent a potentially chaotic no-deal exit but accepted two amendments. One amendment seeks to replace the Irish backstop with alternative arrangements, and another reject the notion of a “no-deal” Brexit.
British Prime Minister Theresa May now has two weeks to persuade European Union chiefs to rethink the Brexit deal they struck last year.
On the economic front, Mortgage Approvals for December released earlier today came in at 63.79K. Approvals number was above the market expectation of 63K.
On the technical front, the RSI is currently at 55.98% and suggests that the market can move in the upward direction. The current price is above the MA5. The current price is above the middle line of the Bollinger Bands and is heading upwards.
Overall Bias is Positive and short-term trades can be initiated with below mentioned Stop Loss and Profit targets.
Trade Suggestion- Limit Buy at 6860. Take Profit at 6910. Stop Loss at 6835