FTSE 100 slide in early trading pushed down by the banking sector. Lloyds Banking Group gives up over 6% at 26.52 after the bank reported a loss of 602 million. Standard Chartered reported that the Net profit drops 30% to $339 million in the second quarter; the previous year profit was at $482 million.
Yesterday the Federal Reserve, kept the interest rates unchanged as per the expectations and signalled that it would keep the low rates until into 2021. Fed extended the USD swap lines with other central banks until March 2021. The central bank warned that the rising number of new coronavirus cases might stop the U.S. economic recovery.
Except for Lloyds and Natwest, Evraz is 4.04% lower at 288.00; Prudential is 3.30% lower at 1,130. Barclays is 2.76% lower at 102.11, and HSBC is 2.42% lower at 353.52. On the positive foot, AstraZeneca trades 2.67% higher at 8,843.
FTSE 100 Index Analysis
FTSE 100 continues in a tight trading range between the 50 and 100-day moving averages. The index gives up 0.9% at 6,083, hitting the lower level since July 14. Bulls failed to stay above the 50-day moving average, and now the correction might accelerate towards the 100-day moving average. FTSE lost the bullish momentum that started since the March lows when broke to the downside the compact rising trend channel.
Bearish traders target now 5,941 – the 100-day moving average. Below that level, we might experience a more aggressive selling targeting the low from Mau 18, at 5,792. On the contrary, bulls will face the intraday resistance at 6,145 today’s top. A credible break above might test the 50-day moving average at 6,198. Above 6,198 bulls would take control and a move up to 6,327 the high from July 21 can’t be ruled out.
FTSE 100 Daily Chart