The FTSE 100 index in the United Kingdom closed Monday's trading session with a loss of 0.43%. It reflected the cautious sentiment in anticipation of national accounts data anticipated to validate the economy's contraction in the fourth quarter of 2023.
Analysts Opinion on FTSE 100
According to projections by Daiwa Capital Markets, the forthcoming national accounts report could confirm a decrease of 0.3% in the gross domestic product of the United Kingdom for Q4 2023. This corresponds to an annual decline of 0.2%.
Furthermore, the monthly distributive trades survey unveiled that retail sales in the United Kingdom exhibited minimal growth in the year leading up to March. Retailers anticipate additional difficulties, as they anticipate a reduction in April sales volume compared to last year.
Principal Economist at the CBI, Martin Sartorius, advocated for government intervention to stimulate the retail sector's recovery. To this end, he proposed a reform of business rates, which would encourage investment and more closely align interest rates with economic cycles.
FTSE 100 Market Movers
AstraZeneca announced that the US Food and Drug Administration approved Ultomiris, a treatment for adult patients diagnosed with Devic disease. After the news, the share price of the biopharmaceutical company decreased by 0.84% as the market closed.
In the interim, the stock price of NatWest Group decreased by 0.42% after the disclosure of its intention to allocate £5 billion towards social housing initiatives in the United Kingdom within the forthcoming three-year period.
FTSE 100 (UK100) Technical Analysis
In the daily chart of the UK 100, a strong upward pressure is visible, where the current price trades at a record high. However, the price created a strong gap with the dynamic 100-day Simple Moving Average, which suggests a pending downside correction as a mean reversion.
On the other hand, the recent dynamic lines show upward traction, while the 20-day EMA is the immediate support. It is a sign that bulls are still active in the market and can continue taking the price higher at any time.
In other technical indicators, the MACD Histogram remained bullish for a considerable time, while the Relative Strength Index (RSI) rebounded from the 70.00 line.
Based on the daily outlook of UK100, a downside correction is pending, where the main aim would be to test the 7786.70 support level. However, immediate buying pressure from the current level could test the 7994.90 Fibonacci Extension level before showing a downside correction.
