FTSE 100 Rises as Oil Prices Soar
05 Jun 2023
Stocks continue to rise as oil prices rise.
The FTSE 100 rose 0.5% to 7,642.49 points.
Saudi Arabia declared on Sunday that it would reduce oil production in January and take “whatever steps are necessary” to raise prices.
Saudi Arabia announced a 1 million barrels per day (bpd) drop in July, and OPEC+ declared its targets will fall by a further 1.4 million bpd starting in 2019.
Higher oil prices often result in a solid performance for the UK market because BP (LON: BP) and Shell are heavily weighted in the index, as it demonstrated once more on Monday, according to Russ Mould, investment director at AJ Bell.
Given that the jobs numbers were better than anticipated yet pay growth has slowed, the market seems eager to believe that this is a sign of a potential soft landing for the US economy.
On the macroeconomic front, a poll that was released earlier revealed that the UK service sector’s output increased in May as companies profited from strong consumer demand despite rising input costs.
The composite PMI, which is the weighted average of comparable manufacturing and services indexes, came in at 54.0, slightly below the 54.9 of April but broadly in line with forecasts. A rise in services activity during the month countered a decline in industrial output.
FTSE 100 TECHNICAL ANALYSIS DAILY CHART:
- FTSE 100 is currently trading in the down channel.
- FTSE 100 is currently trading below 20&50 SMA.
- RSI is in buying zone which suggests bullishness and Stochastic is suggesting up trend.
- Immediate resistance is at 7647.6 & its immediate support level is 7612.2
HOW TO FTSE 100 IN THIS WEEK
After plunging, the FTSE 100 took support from a crucial support area, and the price began to reverse to the upside. Price is currently attempting to continue upward and has broken through the day’s high. Currently, it is trading at a crucial resistance zone; if this zone is broken, further gain is expected.