FTSE dips then heads higher

A record increase in the number of cases in the US is spooking the markets and causing a dip in the FTSE

Charts (4)

A record increase in the number of cases in the US is spooking the markets and causing a dip in the FTSE. However, after the initial decline London stocks are beginning to claw their way higher, particularly defensive assets like utilities and manufacturing firms. Trading and investment firms are also making leaps this morning.

One positive among the gloomy global corona news is that the World Health Organization has declared the spread in Western Europe under control, despite a few localized outbreaks in Germany. There is a fresh increase in the number of cases in Eastern Europe as these countries opened their international borders earlier than Germany and France, but the increase here is from a fairly low base, where the number of cases was  just a fraction of those in the UK, Italy and France.

The unusually hot British summer has not been good news for all and has caused water utilities concerns over the declining level of water in reservoirs. United Utilities, which has started issuing warnings to customers about water usage, lost more than 4% in early trade.

EasyJet, recently relegated out of the FTSE 100, has lost over 5% in early trade, being still sold off a day after reporting a significant loss in the first half of the year. Although the company managed to shore up its finances with a $520 million share placing, this wasn’t enough to lift the shares out of a slump.

US petroleum stocks driving oil price

Oil prices are still sliding, continuing the trend of the last two days because key US petroleum stocks have risen rather than fallen this week. US jobless data due out later today will also be a proxy indicator for what to expect in terms of demand in the US.

More from FTSE 100

From time to time, GAIN Capital Australia Pty Ltd (“we”, “our”) website may contain links to other sites and/or resources provided by third parties. These links and/or resources are provided for your information only and we have no control over the contents of those materials, and in no way endorse their content. Any analysis, opinion, commentary or research-based material on our website is for information and educational purposes only and is not, in any circumstances, intended to be an offer, recommendation or solicitation to buy or sell. You should always seek independent advice as to your suitability to speculate in any related markets and your ability to assume the associated risks, if you are at all unsure. No representation or warranty is made, express or implied, that the materials on our website are complete or accurate. We are not under any obligation to update any such material.

As such, we (and/or our associated companies) will not be responsible or liable for any loss or damage incurred by you or any third party arising out of, or in connection with, any use of the information on our website (other than with regards to any duty or liability that we are unable to limit or exclude by law or under the applicable regulatory system) and any such liability is hereby expressly disclaimed.