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FTSE 100 WOBBLY ON GDP AND BoE’s EMERGENCY RATE CUT -

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    • FTSE 100 WOBBLY ON GDP AND BoE’s EMERGENCY RATE CUT
11-Mar
19:12 IST

FTSE 100 futures are currently trading at 5953-lower by 3.06% as compared to the previous closing. The contract, however, closed in the positive territory in the last trading session.

In the Cash Markets, the FTSE 100 edged up 0.072% to 5,964.54 at the time of writing.

The broad-market index rose earlier in the session after the UK’s central bank cut interest rates to shore up the economy from the rapid spread of the pneumonia-causing virus.

Housebuilders-particularly sensitive to the domestic economy- were trading in positive territory on Wednesday. Taylor Wimpey and Barratt Developments rose 1.96% and 1.62% respectively at the time of writing.

The banking index advanced 2.4%, with stocks in Barclays and Lloyds Banking Group rising 1.32% and 1.08% respectively at the time of writing.

The UK central bank earlier today announced an emergency cut to interest rates in an attempt to buffer the economy from the fast-spreading coronavirus.

The Bank of England cut its main interest rate from 0.75% to 0.25%. The central bank also announced a new term-funding scheme to support small and medium-sized businesses.

The FTSE 100 was ending in negative territory for the last four days due to concerns about the rapid spread of coronavirus and a rout in crude markets.

The UK PM is scheduled to unveil his first budget at 1230 GMT on Wednesday.

London’s main index is down more than 20% from its January peak as the coronavirus outbreak takes a huge toll on the travel industry and hurt business operations.

The FTSE 250 midcap index added 0.39% at the time of writing.

On the data front, U.K. Industrial Production (MoM) for January released earlier today came in at -0.1%. The Industrial Production was below the consensus estimates of a rise of 0.3%.

In addition, the U.K. GDP for January was released on Wednesday. The MoM rate of change in the GDP was +0.0%. The GDP change was below the consensus estimates of 0.2%.

On the technical front, the RSI is currently at 29.38% and suggests that the market can move in the downward direction. The current price is below the MA5. The %K has crossed the %D from below to the upside at around 10% and suggests that the market can move in the upward direction.

Overall Bias is Negative and short-term trades can be initiated with below mentioned Stop Loss and Profit targets.

 

Trade Suggestion- Limit Sell at 5970. Take Profit at 5890. Stop Loss at 6010

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