FTSE 100 Lloyds

FTSE 100 Pare Morning Gains On Weak Earnings From BT, NatWest and RBS

FTSE 100 pares morning gains as the weak economic data from the USA and Europe continue to weigh on investors sentiment. The GDP figures in the USA and Europe paint a dismal economic picture for the global economy. The U.S.A Gross Domestic Product for the second quarter contracted by 32.9%, marking a fresh 70-year low. The Initial Jobless Claims rose for a second straight week up to 1434K.

In Europe, the Spain Gross Domestic Product plunged to -18.5%, well below the expectations of -16.1% for the second quarter. The France GDP registered in at -13.8%. The Italy Gross Domestic Product slumped to -18.7% in the second quarter. The European Monetary Union (EMU) Gross Domestic Product (GDP) seasonally-adjusted came in at -15% below the estimates of -14.5%.

In the U.K. the Annual housing prices growth rebounded to 1.5% from a 1.6% decline June, beating the expectations of -0.3%. On the month, the housing prices were up 1.7% above the expectations of -0.1%. The improvement reflects the easing of the lockdown measures in June.
In corporate news, Natwest took an impairment loss of 2 billion in the second quarter, while yesterday Lloyds earnings report also disappointed investors. RBS reported 770 million loss and guided for impairments up to 4.5 billion. B.T. Group also reported a slump in revenues and profits.

FTSE Daily Technical Analysis

FTSE 100 hovers around the 6,000 mark after it reversed early session gains. Yesterday the FTSE index was under selling pressure but managed to rebound from the 100-day moving average, which provides at least for now strong support. 

Looking north, the immediate resistance for the index is at 6,046 today’s high. A break above might challenge the top from yesterday at 6,139. The 50-day moving average has turned now into strong resistance at 6,196. 

On the flip side, the critical point is the 100-day moving average at 5,940. A break below might have negative implications for FTSE, and we might experience a sharp correction down to 5,806 the low from May 18. 

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FTSE 100 Daily Chart

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