FTSE pares gains; food inflation in focus
The FTSE 100 was up 0.2% at 7,485.60.
Richard Hunter, head of markets at Interactive Investor, said: “It remains to be seen whether this relief rally is justified until such time as the planks of banking uncertainty can be removed once and for all, leading to an improvement in investor confidence which is currently in scant supply.”
Investors were digesting separate surveys showing that food prices continued to soar in March.
According to the BRC-Nielsen Shop Price Index, annual shop price inflation hit a new high of 8.9% in March, from 8.4% in February.
Within that, non-food inflation was 5.9% compared to 5.3% a month earlier, while food inflation surged to 15% from 14.5% in February. It is the highest food inflation rate on record.
Fresh food inflation also hit a new high, rising to 17% from 16.3% a month earlier, while ambient food inflation rose to 12.4% from 12%.
Investors were also digesting Bank of England governor Andrew Bailey’s testimony to the UK Treasury Committee.
London’s main share index rose in morning trade, with banks once again keeping prominent slots on the leader board. However, much of the rally fizzled out as the day went on amid tax raids of several French banks, leaving the FTSE around where it started the day.
Elsewhere, Bank of England Governor Andrew Bailey appeared before MPs on the rescue of the UK arm of Silicon Valley Bank.
Investors were absorbing trading updates from Ocado, as well as full-year results from housebuilder Bellway and Irn Bru maker AG Bell.
London’s FTSE 100 stayed positive in late-morning trade, but pressure on housebuilders after news of falling profits in the sector knocked its stocks.
FTSE 100 TECHNICAL ANALYSIS DAILY CHART:
FTSE 100 is currently trading in 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 7504.2 & its immediate support level is 7459.8
HOW TO TRADE FTSE 100 IN THIS WEEK
The FTSE 100 is currently trading on the downside, facing resistance at a certain level and the price is going down from there. If the daily low is broken, we may see a lower price.