The FTSE 250 index made a strong recovery as global stocks rebounded. The index, made up of small and mid-cap London stocks, rose to a high of £20,298, which was the highest level since June 9th of this year. It has made a spectacular recovery from the year-to-date low of £18,291. Similarly, the FTSE 100 index rose by 0.25%.
UK earnings season
The FTSE 250 index rose as investors reacted to a slew of mixed corporate earnings from London. On Tuesday, IWG, the parent company of Regus, published strong earnings and weak guidance. As a result, the IWG share price dropped by more than 10%.
On Wednesday, the Carnival share price jumped by more than 11% as investors reflected on the latest report by Norwegian Cruise. The company announced that it had dropped mandatory covid vaccinations on sailings from US ports. Other companies like Carnival and Royal Caribbean will also follow suit, which will likely lead to more demand.
Meanwhile, the TP ICAP Finance share price jumped by over 12%, becoming the best-performing FTSE 250 stock. This happened after the company published strong half-year results and boosted its guidance. Other FTSE 250 companies that performed well are Future plc, Kainos Group, and Pets At Home.
On the other hand, the worst performers in the FTSE 250 index were firms like Drax Group, Tullow Oil, Wood Group, and Telecom Plus. The next key FTSE 250 and FTSE 100 companies to watch will be Entain, Savills, Spirax-Sarco Engineering, and 888 Holdings. All these firm will publish their results on Thursday and Friday of this week.
FTSE 250 forecast
The daily chart shows that the FTSE 250 index has been in a strong bullish trend in the past few weeks. And on Wednesday, it managed to move above the important resistance at £20,212, which was the highest point on June 8th.
The index managed to move above the 25-day and 50-day moving averages and is between the 23.6% and 38.2% Fibonacci Retracement levels. Therefore, the FTSE 250 index will likely continue rising as bulls target the 50% retracement at £21,273. A drop below the support at £19,816 will invalidate the bullish view.