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The UK 100 may be in the red but it is holding a 2-week rising channel. Ahead of another busy week for corporate updates (on both sides of the pond) and central bank policy reviews (BoJ, BoE, Fed), sentiment is hampered by index heavyweights pricing in a combination of Sterling off its lows, metals continuing to give up ground on trade concerns as well as still digesting last week’s Tech sector weakness.
Contributors: UK Index -25pts, dented by negative contributions from HSBC (Goldman Sachs prefers STAN), DGE/BATS (GBP strength vs USD), BP/RDSB (GBP up, oil down), NG (Ofgem price controls), Miners (lower metals prices) and BT (lost UFC and NBA rights). Support, albeit insufficient, can be found from RB (defensive, GBP weakness vs EUR, still digesting last week’s results), BARC (optimism ahead of Q2 results and BoE/Fed rate hikes) and GSK/AZN (defensive, momentum).
Technicals: The UK 100 is offside, but trades high of the day after bouncing off the 7655 floor of its rising channel.
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The UK 100 is offside, but trades high of the day after bouncing off its 7655 rising channel floor.
Watch levels: Bullish 7700, Bearish 7660
Solid Green line
Possible support
Solid Red line
Possible resistance
Important: The information provided above does not constitute advice or opinion and must only be regarded as technical observations.
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Prepared by Michael van Dulken, Head of Research