After another week of top tier events and major surprises, some UK blue chip stocks are back trading at some pretty notable lows. And with the UK 100 itself back trading at December 2016 lows, if these stocks rally, would now be a good time to buy the index?

Global indices have been taken on a ride this week, as events predominantly in the US have given traders pause for thought. Yet more firings in the White house and the announcement of a range of tariffs on Chinese goods have increased speculation about a global trade war.

But there are some very specific positive turn of events that have taken place this week which may offer UK stocks some safety from the global hazards.

The UK and the EU announced they had agreed to a 21-month Brexit transition deal, in which the UK would maintain access to the EU marketplace, which also allows British goods to be exempt from US tariffs as part of the EU.

Not only does the transition deal mentioned above clear some uncertainty from the minds of British business leaders, but data this week showed that inflation is cooling while wages increase. This effectively gives consumers more disposable income which could be utilised to purchase products and services offered by the UK’s largest companies.

And the Bank of England noted these changes, alongside stronger economic conditions, which has allowed them to prepare markets for a potential May interest rate hike, a sign of confidence in the UK economy.

It’s these big changes in the UK’s fortunes that could help some of the UK 100 ‘s biggest names climb from some pretty impressive levels.

Vodafone (VOD; right), one of the top 10 largest stocks on the UK 100 , is currently trading at a 14-month low after the telecoms giant fell as much as 5.6% over the course of this week.

However, having met a 4-year long rising lows around 191p, the shares are one of a handful on the UK’s blue-chip index to trade over 1% higher.

Is this the start of a turn around for the company and, more importantly, a potential catalyst for the UK 100 to gain some footing?

Lloyds Banking Gorup (LLOY), the retail investing favourite, is another UK 100 company that has fallen over 5% this week, seeing the UK banking stock turn negative on the year. However, it too has a long term trend of rising lows that may act as support around 64.5p. 4 month low

Finally, another telecoms company, BT (BT.A; left) touched a fresh 6 year low yesterday as the company’s shares continued a major downtrend. Having started at over two years ago in February 2016, the shares have now fallen an immense 55% during that time.

While its shares may not be likely to engineer a turnaround from their current 2-year downtrend, could a bounce from the floor of its falling channel be the beginning of a near 12% recovery to February highs of 245p, while a return to the channel ceiling would require a 20% rally.

Interestingly, BT is one of just 28% of shares that are trading higher today having posted declines every other day of this week. Is this the start of a recovery?

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Sam Springett, Senior Trader, 23 March 2018