FTSE Lower after Swine Flu Alert Level Raised
In mid-morning trading the FTSE 100 is down on the day so far.
From the start of trading this morning UK stocks have been under pressure, with fewer than ten of the FTSE 100 constituents registering a positive move for the day.
The main catalyst for this early weakness is the increasing worries regarding the swine flu virus. Monday saw a muted reaction to the news, but with the alert level for the virus raised by the World Health Organisation, traders have had to re-evaluate just how serious this could end up being.
One of the few positives today is the BP share price. First quarter profits are down by more than 60% compared to a year ago, but still managed to beat analysts’ expectations.
There had been concern that the double whammy of a plunge in oil price and a slump in global demand for fuel would take more of a toll on the numbers.
BP seems to have weathered this better than expected and the share price has pushed back to levels not seen since the middle of February, with speculation of a possible run back to the 520p area.
Looking ahead to the US markets, and at the moment we are expecting the Dow Jones index to open down around 90 points. Flu concerns are playing their part, as are worries that Bank of America and Citigroup could need even more cash.
Both these factors, plus consumer confidence numbers due out after the US markets open, could add some volatility to today’s session – although so far, dips in the US have still brought the buyers back out, with 7900 seen as the significant short-term support for the Dow.
Also see today’s market update, Spread Trading.
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Good Luck!
DB
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