FTSE 100 trades higher for the second day as investors trying to asses the impact of the coronavirus outbreak in the global economy. China reported today that there are 5974 confirmed cases and there are 132 deaths. Stocks in London are getting a boost from the positive close in Wall Street, ahead of the Federal Reserve policy decision later today. Stock investors sentiment also getting a hand from upbeat Apple earnings report. The strong demand for iPhone drove first-quarter sales 8% higher year-on-year, beating Wall Street forecasts. Apple is a bellwether company as it has a major exposure in China. Reduced store visits in China might have a negative impact in the second quarter for Apple.
Fed is expected to keep benchmark interest rates unchanged and investors will focus on any revision of the forward outlook after the coronavirus outbreak.
Investors focus will also be on the Bank of England on Thursday and the monetary policy decision. The upbeat economic data from the UK economy last week have lowered the possibility of an interest rate cut on Thursday.
FTSE 100 is 0.15% higher at 7492 on cautious mood. Bulls managed to break above the 50-day moving average yesterday and improved the bulls sentiment. The FTSE 100 managed to rebound from the monthly lows after the steep losses due to coronavirus effect.
On the upside, initial resistance for the FTSE index stands at 7,514 the daily high. The next resistance for FTSE will be met at 7586 the high from January 27th. More offers might emerge at 7640 the high from January 24th.
On the other hand, immediate support for the FTSE index stands at 7,480 the daily low. If the index breaks that level, the next support zone will be met at 7460 the 50-day moving average. The recent positive momentum could be canceled if the FTSE pierces the 100-day moving average at 7374.