The FTSE 100 index is rising for the fifth straight day as investors remain optimistic about stimulus in the United States and a swift recovery to the global economy. The Footsie is also rising ahead of the important US nonfarm payroll numbers and after Donald Trump finally conceded defeat.
What’s happening: The FTSE 100 is having an excellent start of the year, with its price rising by more than 6% since Monday. This upswing is mostly because investors believe that the new US government will provide more stimulus to the economy.
In fact, Democrats have already earmarked several priorities, including funds for more stimulus checks and infrastructure spending. Such spending will be beneficial to some FTSE 100 companies that do business in the country.
The Footsie is also rising because investors believe that the economy will have a robust rebound as countries continue their vaccinations.
Companies to watch today: Banks will be top companies to watch in the FTSE 100 today. This is because there are signs that the Bank of England (BOE) is said to be considering negative rates.
That could have a negative impact on banks like NatWest, Barclays, and Lloyds that do a lot of business in the country. Centrica will also be watched after employees of British Gas, a company it owns, decided to go for a strike. Yesterday, Centrica share price fell by more than 2% and the losses could accelerate today.
FTSE 100 technical outlook
On the daily chart, we see that the FTSE 100 index moved above the descending channel on November 9. Most importantly, the index formed a golden crossover on December 15, when the 200-day and 50-day EMA crossed. Therefore, it seems like bulls are still in control, which will push the price higher. The next target is the psychological level of £7,000.
FTSE 100 technical chart