UK stock markets have witnessed a higher number of positive trading sessions in the present calendar year with the key stock index FTSE 100 on track to register the best month of the coronavirus pandemic-led 2020. The aftermath of coronavirus has kept investors at a backfoot in most of the trading months of this year so far; however, some sectors had staged a meaningful recovery after the initial crash in the respective share prices when the pandemic rattled the global stock market.
Successive “mini rallies”
According to the indices historical data available with the London Stock Exchange, the benchmark FTSE 100 has ended the month on a negative footing in six out of 10 months until October in 2020. Surprisingly, FTSE 100 is all set to conclude November 2020 with maximum gains in the 11-month stretch of 2020 so far. November 2020 has emerged as the best month for FTSE 100 with the London’s prime stock index rising more than 10 per cent led by the back-to-back “mini rallies” following the positive developments in the last 30 days.
The onset of US presidential elections followed by a clear winner in the results provided the initial thrust to the FTSE 100 index. In the first week of November, FTSE 100 witnessed a spike of approximately 6 per cent followed by a jump of 6.9 per cent in the subsequent week. The breakthrough in the development of Covid-19 vaccine in Phase 3 clinical trials jointly announced by Pfizer and BioNTech triggered a global wave of value-buying that resulted in a comprehensive gain of nearly 7 per cent in the second week of November.
The index dropped a little over 1 per cent in the last two trading sessions of the second week on the back of partial profit booking across the sectors and the re-surfaced fear of deprived business activity due to the then ongoing lockdown across the geography of England. The persisting deliberations with regard to the prospective trade deal between the European Union (EU) and the United Kingdom (UK) have reinstituted anxiousness among the investors in the successive week.
Best month in pandemic’s 2020
A largely similar investors’ sentiment stayed in the last two weeks of November following which the index managed to gather marginal gains. The FTSE 100 amassed a modest rise of 0.81 per cent in the last two weeks. Conclusively, the heavyweight stocks-constituting index returned as much as 14.17 per cent to 6,367.58 (27 November) from a level of 5,577.27 as on 30 October. Today (30 November), the FTSE has been trading largely flat at the time of writing (14:05 GMT) at 6,359.70, down 0.12 per cent from the previous closing level of 6,367.58.
FTSE 100 (1-month performance)
(Source: Refinitiv, Thomson Reuters)
Going ahead, the developments and progress in connection to the coronavirus vaccine in the United Kingdom, the outcome of the ongoing consultations for a trade deal between the EU and the UK, the effects of the soon-to-be-imposed three-tier system and global cues are likely to chart the market direction.