FTSE 100 trades in range on BoE’s inflation warning

Highlights 

  • FTSE100 trades in the green but in a range, up by 0.27% at 7,102, while the mid-cap focused FTSE250 index trades at 23,845, up by 0.26%.
  • The flash Purchasing Managers' Index (PMI) declared by the IHS Markit/CIPS indicates a slowdown in growth.

FTSE 100 trades in the green, albeit in a range, up by 0.27% at 7,102, while the mid-cap focused FTSE 250 index trades at 23,845, up by 0.26%. Meanwhile, the Bank of England (BoE), in its policy meeting, left the policy rates unchanged but warned that inflation might breach 4% level in the last quarter of the year due to a surge in the energy prices.

In other development, the UK’s preliminary flash Purchasing Managers' Index (PMI) has declined in September month. PMI reading slipped to 54.1 from 54.8 in August, which is the lowest reading since February 2021. The data compiled by the IHS Markit/CIPS indicates a slowdown in the growth mainly due to supply chain problems and labour force shortage holding back the growth.

Top five FTSE100 gainers

Rolls Royce Holdings Plc (3.11%), Halma plc (2.12%), Antofagasta plc (1.76%), Scottish Mortgage Investment Trust plc (1.68%), 3i Group Plc (1.63%).

Top five FTSE100 losers

Entain plc (-3.53%), Hargreaves Lansdown plc (-2.22%), International Consolidated Airlines Group SA (-1.81%), Prudential plc (-1.41%), Polymetal International plc (-1.04%).

European Markets

Major European market indexes are trading in the positive territory. The German blue-chip DAX index is up by 0.76% at 15,624, while the benchmark index of France, CAC 40, was at 6,686, up by 0.74%. Deutsche Bank Chief Financial Officer James von Moltke said there could be mergers and acquisitions in the European banking sector, and the banking industry will get consolidated in coming years.

Currency Markets

After yesterday’s fall, the pound trades higher against the dollar at 1.3702, up by 0.59%, while the EUR/ GBP currency pair traded at 0.8552, down by 0.26%. The dollar trades higher against the major European currencies despite US Federal Reserve keeping the interest rate unchanged at the monetary policy meeting.

Commodities

WTI crude oil future contract traded at USD 71.70, down by 0.64%, while the Brent crude oil trades at USD 75.71, down by 0.62%. Crude oil prices are slightly lower but mainly in the green zone as investors anticipate higher fuel demand. Also, crude oil output from OPEC+ nations has been lower as countries like Nigeria and Kazakhstan are unable to boost higher output due to site maintenance work delayed by the pandemic and lower investment in the oil assets due to uncertainty during Covid-19 period.

Meanwhile, the Gold futures contract was trading in the red, down by 0.30% at USD 1,773 per ounce.

Asian Markets

Major Asia Pacific indexes closed in the green zone. Shanghai Composite of China closed at 3,642, up by 0.38%, India’s Nifty 50 closed at 17,822, up by 1.57%. Australia’s ASX200 closed at 7,370, up by 1.00%, while the Hang Seng index was up by 1.20% at 24,510.

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