You might also be able to trade the FTSE 100 on other spread betting websites.
UK Stock Market Analysis and Trading News
[4:20pm] The FTSE has seen its gains increase during the afternoon, with US markets opening higher as well following yet more earnings updates.
Having breezed back through 6800 today, the level that caused it so much trouble in recent sessions, the FTSE 100 is now seemingly on course for yet another try at 6880.
It has been the case again and again that apparently major risks to the equity environment, such as Ukraine, only last for a few days before the fear factor recedes.
That appears to be happening again, with the index helped on its way by good updates from serial strong performer Next.
Even so, today could mark the high point of the week, with the avalanche of major US figures conspiring to reduce the general appetite for equities.
In addition, August and its low-volume purgatory are now on the horizon, raising the risk that gains this week could be transitory at best.
Update by Chris Beauchamp, Market Analyst,
BAT Looks for New Opportunities
Ahead of the tobacco firm's interim results, IG talks to Elaine Coverly from Brewin Dolphin about what the company needs to do in order to expand revenue and stay relevant.
[10:43am] In mid-morning trading the FTSE 100 is down five points as traders fail to get excited about earnings season.
GKN is leading the FTSE 100, with the engineering firm raising its profits and dividend.
The strong pound has weighed on its sales but it hasn’t affected the share price, which is up over 6%.
It would appear that there is no stopping Next, the fashion retailer has gone from strength to strength after it announced another increase in profits and raised its full-year guidance.
The increase in market regulation and a drop in market volatility are evident when looking at the revenue stream from interdealer broker Tullet Prebon.
Major investment banks are earning less from fixed income, currencies and commodities, and this is trickling down to the deal makers.
BP is being tarred with the same brush as Russia, and being in bed with the oil producing nation could hit its second-quarter profits.
Additional sanctions could be slapped on Moscow and the judgement from Yukos oil could hurt Rosneft, which BP owns a stake in.
Update by David Madden, Market Analyst,
'Dark Pool' Litigation Hits Barclays Ahead of Earnings
It's been over a month since the announcement from US regulators that they are suing Barclays US investment bank.
They allege that the bank favoured HFT traders using its 'dark pool' trading venue, and in the process potentially disadvantaging its big pension fund and institutional clients.
New CEO Antony Jenkins must feel like a punch bag; as he strives to navigate more land mines, given his pledge to clean up the bank, when he took over in 2012.
Nicknamed St Antony when he took over with his 'Project Transform' policy to clean up the bank, it would appear that no-one appears to be listening in the US investment banking arm.
We have recently seen news that Barclays would have to create a bad bank for some significantly underperforming investment banking assets in Fixed Income and commodities (FICC), and its European retail operations.
Having just digested this, the allegations from the US regulator that Barclays is vigorously contesting are the last thing Antony Jenkins needs right now.
These allegations appear to be somewhat of an own goal on the part of its US arm which has been the beneficiary of some backtracking by its new CEO on the subject of bonus cuts amidst threats of mass defections.
Should Barclays Close the Investment Arm?
Given the severity of these allegations and the subsequent drop in trading revenues as a result, tomorrow's trading update could well see a significant hit to revenues in the investment banking unit.
This would then raise the question as to why keep it open, given that the unit is already undergoing significant restructuring changes, with the loss of 7,000 jobs over three years.
The pay and practices of investment banking continue to come under scrutiny not only in the UK, but across the globe as well.
The prospect of further inquiries on top of recent litigation could well suggest that the banks investment banking unit needs shrinking further given that fixed income business at other major institutions is also on the decline.
This will be an important component of this week's update with close scrutiny on the investment banks trading revenues which are certain to have taken another hit, in the wake of these allegations as well as the lower volatility seen this year.
According to the lawsuit filed in New York last month, Barclays allegedly falsified marketing materials to institutional investors concerning its so called monitoring system called 'Liquidity Profiling', which it told investors enabled it to identify predatory trading and ban malicious trading practices or HFT traders.
It is also alleged the bank falsely claimed it did not favour its own dark pool when routing client orders to trading venues.
The bank looks set to vigorously contest these charges suggesting that it feels it is on fairly solid ground.
Coming as this does on the back of the furore over the recent multibillion dollar fine on Banque Paribas, the fear must be that given recent evidence of fine inflation, which we've been seeing from regulators, that Barclays could be hit very hard if these charges are proven.
Barclays Hopes to Replicate RBS Results
The share price has come under pressure since the announcement of the SEC investigation, with the shares hitting their lowest levels since November 2012 earlier this month, though we have seen a modest rebound since then.
The rebound has been largely as a result of last week's surprise improvement in Royal Bank of Scotland's latest numbers, which has raised hopes that Barclays could also surprise on the upside.
This seems a rather optimistic assessment given RBS's profits improvement was down to improved valuations in its bad bank's assets, which got deep-sixed at the end of last year, when the bank announced another hefty loss.
What this inquiry in the US does do is increase the uncertainty in the broader banking sector as inevitably we could well find further examples of this amongst other banks that operate their own dark pools, with reports that Swiss bank UBS is also under investigation.
We constantly hear banks complain about overzealous regulation, and there is certainly a risk of a knee jerk response in a lot of these cases, but when stories about malpractice, alleged or otherwise consistently hit the headlines, as in the case of Lloyds this week, it is hard to feel any sympathy whatsoever.
If you behave like a misbehaving child then you should expect to be treated like one.
This looks like yet another reason to be cautious about the banking sector as increased scrutiny and regulation, as well as more fines, is likely to be the result of another PR pot-hole for the banking industry.
Update by Michael Hewson, Senior Market Analyst,
Fracking Given Greenlight in UK
As the UK government gives the go-ahead to firms to apply for test drilling permits, IG takes a quick look at how fracking works and what some of the practicalities may be.
FTSE 100 Daily Trading News
The FTSE 100 is currently trading at 6,800.5.
In the last session, the market closed down -6.7pts (-0.10%) at 6,791.9.
30 Minute Chart Analysis
The index is trading above the 20-period MA of 6,793.3 and above the 50-period MA of 6,793.6.
1 Day Chart Analysis
The index is currently above the 20-day MA of 6,770.1 and above the 50-day MA of 6,795.8.
Update by Gordon Childs, Editor,
[7:35am] FTSE 100 Technical Analysis (30 mins chart)
FTSE 100 pivot point: 6715
Our preference: Long positions above 6715 with targets @ 6785 & 6800 in extension.
Alternative scenario: Below 6715 look for further downside with 6670 & 6644 as targets.
Comment: Even though a continuation of the consolidation cannot be ruled out, its extent should be limited.
[7:35am] UK Shares - Crossing Over their 50 Day Moving Average:
Ashmore Group (+0.75% to 362.7p)
BSkyB (+3.43% to 904.5p)
Reckitt Benckiser (+2.66% to 5205p)
Rightmove (+1.75% to 2208p)
UK Shares - Crossing Under their 50 Day Moving Average:
Aberdeen Asset Mgmt (-5.31% to 435p)
Hiscox Ltd (-2.78% to 683p)
Informa (-1.09% to 490.6p)
Smith & Nephew (-2.27% to 1033p)
[7:23am] Asian stocks advanced overnight with the benchmark regional index advancing to a six-year high, while bonds followed US treasuries lower before the Federal Reserve starts their meeting today.
The FOMC are expected to release a statement tomorrow evening which could help show future direction of monetary policy.
The dollar remains flat against major rivals as investors take to the side-lines following major economic data releases including the FOMC, jobs and GDP data from the US.
A decline in Japanese retail sales fell more than forecast in June, capping a weak quarter that challenges Prime Minister Shinzo Abe's bid to reflate the economy while heaping a heavier tax burden on consumers.
Sales declined 0.6% from the year earlier, falling further than the median forecast of 0.5%. In the second quarter, sales slumped 7% from the previous three months.
Shares in BP will be in focus on the open after they reported second quarter earnings, posting a dividend of $9.75 per share on revenues of $7.6 billion.
BP sees third quarter reported production to be lower than the second quarter.
Update by Lee Mumford, Trader,
How Will Sanctions on Russia Impact BP?
In the last six months, the energy sector has been the best performer of the S&P 500, up 15%.
Along with trouble in the Middle East, the rising tension with Russia had helped oil prices move steadily higher, with Brent crude oil going from $106 per barrel at the start of the year, to as high as $116 in June.
As an integrated oil major, higher oil prices tend to be positive for the upstream part of BP's business.
In late June however, the supply-shock in Iraq that resulted with a drop in crude oil prices, saw shares for diversified and upstream oil companies, BP included, suffer a setback.
BP had actually been the outperformer amongst the oil majors but when Russian troops moved in to occupy Crimea in February the stock's relative outperformance peaked and never recovered.
Since the US government's sectoral sanctions against Russia included the energy sector in late June, BP's underperformance has accelerated.
The stock has risen by just 2% and hugely underperformed major oil rivals Royal Dutch Shell, Exxon Mobil and Chevron, whose shares were all up by more than 9% in the same period.
Since then BP's shares have lagged behind its peers due to its strong ties to Russia, the world's second largest oil-exporter which has been sanctioned by both the US and Europe since it annexed Crimea from Ukraine.
BP More Heavily Exposed to Sanctions
While a lot of its peers do have minority interests in Russia through oil prices and strategic partnerships with Russian oil companies, BP's exposure makes it much more susceptible to political headwinds by way of its associations with Rosneft.
The latest US sanctions target specific Russian companies including Russian national oil company Rosneft but they do not, as yet, bar US companies from transacting with them nor do they freeze assets.
The point is to starve the Russian companies of US dollar funding in order to exert political pressure on the Russian leader to rein back his political ambitions in Eastern Ukraine.
The likely result would be a higher cost of funding for the likes of Rosneft, which will eat into earnings from any future investment without directly preventing any kind of strategic partnership.
Exxon has a substantial number of joint ventures with Rosneft while Chevron has a stake in a Russian pipeline.
What sets BP apart from the pack however, is its 20% stake directly in Rosneft, thereby tying BP's performance directly to the earnings of Rosneft.
In the first quarter Rosneft contributed 10% of BP's profits; while this is significant, a reduction in that contribution would likely not be enough to impact BP maintaining its dividend of $0.0975 per share that it announced last quarter.
Widely considered a blue chip stock, BP attracts a lot of income investors who would be unlikely to sell due to short-term price fluctuations and could act as buffer to any future declines.
A rise in oil prices or at least a stabilisation of recent declines should benefit BP's share price but while Russia is being sanctioned by the US and Europe and BP maintains its 20% stake in Rosneft, the current trend in prices suggest BP risks continuing to underperform.
Last month saw its shares trade at its highest price since the environmental disaster of the Deepwater Horizon oil spill in the Gulf of Mexico in 2010, which cost the company billions of dollars in settlements.
BP, the world's third largest oil company by revenue, will be releasing its quarterly earnings report today, July 29th and is expected to earn $0.19 per share, down from estimates of $0.22 at the start of the year but still an improvement on the $0.14 earned in the same quarter last year.
Revenue is expected to rise slightly to $95bn from the $94.7bn earned in Q2 a year ago.
You can also use a spreads account to access shorter-term daily FTSE markets. Readers should note that opening such an account is normally subject to suitability and status checks.
If your account application is accepted then, once logged in, you will be able to access the charts and the current prices. Access is normally free, however, the catch is that you could get the odd sales letter or email from your firm.
Of course, if you do decide to trade, be aware that spread trading and contracts for difference carry a high degree of risk and you may lose more than your initial deposit.
Advanced Charts for the FTSE 100
Although the charting packages normally differ from platform to platform, in order to assist you with your FTSE 100 analysis, most charts generally have:
A large range of time intervals - 1 minute, 2 minute, 10 minute, 1 hour, 4 hour, 1 month etc
A variety of chart types - candlestick, line and OHCL charts
Drawing tools and features - Fibonacci Time Zones, Arcs and Fans
If you are interested in a free Test Account which allows users to get a better understanding of financial spread betting, and practice trading markets like the FTSE 100, then you could always take a look at:
All of the above companies provide a Demo Account that lets users practice trading, apply a variety of orders, try out strategies and review charts.
How to Spread Bet on the FTSE 100?
As with many global markets, investors can spread bet on stock market indices, like the FTSE 100, to either rise or fall.
If we log on to Financial Spreads, we can see they are showing the FTSE 100 Rolling Daily market at 5785.3 - 5786.3. This means an investor can spread bet on the FTSE 100 market:
Going above 5786.3, or
Going below 5785.3
When spread betting on the FTSE 100 index you trade in £x per point.
Where a point is one point of the index itself.
Should you choose to invest £4 per point and the FTSE 100 moves 24 points then that would alter your profit/loss by £96. £4 per point x 24 points = £96.
Rolling Daily Index Markets
An important aspect of this Rolling Daily Market is that there is no closing date for your trade. You do not have to close your trade, should it still be open at the end of the day, it will roll over to the next session.
If you allow your trade to roll over and are spread betting on the market to:
Increase - then you will be charged a small overnight financing fee, or
Decrease - then a small payment is normally credited to your account
So, if we take the above spread of 5785.3 - 5786.3 and assume:
You have analysed the indices markets, and
You feel that the FTSE 100 index will rise above 5786.3
Then you could decide that you want to buy a spread bet at 5786.3 and risk, let's say, £2 per point.
With this trade you make a profit of £2 for every point that the FTSE 100 index moves higher than 5786.3. However, it also means that you will make a loss of £2 for every point that the FTSE 100 market moves below 5786.3.
Considering this from another angle, should you buy a spread bet then your profits (or losses) are worked out by taking the difference between the closing price of the market and the initial price you bought the market at. You then multiply that difference in price by your stake.
Therefore, if after a few trading sessions the UK stock market rose, you might want to close your position to lock in your profit.
So if the stock market increased then the spread, set by the spread betting company, might move up to 5849.4 - 5850.4. In order to close your position you would sell at 5849.4. Accordingly, with the same £2 stake:
P&L = (Closing Price - Opening Price) x stake
P&L = (5849.4 - 5786.3) x £2 per point stake
P&L = 63.1 x £2 per point stake
P&L = £126.20 profit
Speculating on stock market indices, whether by spread betting or not, doesn't always work out. In this example, you had bet that the index would go up. Nevertheless, it might go down.
If the FTSE 100 index began to drop then you might choose to close your spread bet in order to restrict your losses.
Should the market pull back to 5731.9 - 5732.9 then you would close your spread bet by selling at 5731.9. If so, you would lose:
P&L = (Closing Price - Opening Price) x stake
P&L = (5731.9 - 5786.3) x £2 per point stake
P&L = -54.4 x £2 per point stake
P&L = -£108.80 loss
Note - FTSE 100 Rolling Daily prices as of 1-Oct-12.
Below we have a simple interactive example from Financial Spreads on how spread betting works when trading the FTSE 100.
This quick example shows how the Stop Loss works and also how your upside is unlimited.
Note that Stop Losses are not guaranteed but you can opt for a Guaranteed Stop Loss with Financial Spreads.
How to Spread Bet on the UK 100 - Example 2
Looking at a spread trading website like Tradefair, we can see that they are showing the UK 100 Rolling Daily market at 5787.8 - 5788.8. This means an investor can spread bet on the UK 100 market:
Rising above 5788.8, or
Falling below 5787.8
Whilst financial spread betting on the UK 100 index you trade in £x per point. So, should you decide to risk £5 per point and the UK 100 moves 27 points then that would make a difference to your bottom line of £135. £5 per point x 27 points = £135.
So, if you continue with the above spread of 5787.8 - 5788.8 and assume that:
You have done your research, and
Your research suggests that the UK 100 index will move higher than 5788.8
Then you might decide that you want to go long of the market at 5788.8 and risk, for the sake of argument, £3 per point.
So, you make a profit of £3 for every point that the UK 100 index moves above 5788.8. However, such a bet also means that you will lose £3 for every point that the UK 100 market decreases below 5788.8.
Looked at another way, if you ‘Buy’ a spread bet then your profit/loss is calculated by taking the difference between the settlement price of the market and the price you bought the market at. You then multiply that difference in price by your stake.
As a result, if after a few sessions the UK stock market started to move upwards then you could choose to close your trade in order to guarantee your profit.
So if the market moved up then the spread might change to 5831.6 - 5832.6. You would close your position by selling at 5831.6. Therefore, with the same £3 stake your profit would be calculated as:
Profits (or losses) = (Closing Value - Initial Value) x stake
Profits (or losses) = (5831.6 - 5788.8) x £3 per point stake
Profits (or losses) = 42.8 x £3 per point stake
Profits (or losses) = £128.40 profit
Financial spread trading doesn't always work out as you would have liked. In this case, you wanted the UK index to rise. Nevertheless, it might decrease.
If the UK 100 index decreased, contrary to your expectations, then you might decide to close/settle your trade to limit your losses.
So if the spread fell to 5751.2 - 5752.2 you would close your trade by selling at 5751.2. Accordingly, your loss would be:
Profits (or losses) = (Closing Value - Initial Value) x stake
Profits (or losses) = (5751.2 - 5788.8) x £3 per point stake
Profits (or losses) = -37.6 x £3 per point stake
Profits (or losses) = -£112.80 loss
Note: UK 100 Rolling Daily spread betting market accurate as of 28-Nov-12.
How to Trade FTSE Futures
If we go to a platform like FinancialSpreads, you can see that they are currently pricing the FTSE 100 March Futures market at 5717.3 - 5721.3.
Therefore, you can speculate on the FTSE 100 index:
Settling above 5721.3, or
Settling below 5717.3
On the expiry date for this 'March' futures market, 15-Mar-13.
As with the daily markets above, with the FTSE futures market you speculate on the FTSE 100 index in £x per point. So, if you decided to have a stake of £4 per point and the FTSE 100 moves 35 points then that would alter your profits (or losses) by £140. £4 per point x 35 points = £140.
FTSE 100 Futures Trading Example
If we think about the spread of 5717.3 - 5721.3 and assume that:
You have analysed the UK stock market, and
Your analysis suggests the UK index will finish above 5721.3 by 15-Mar-13
Then you may decide to buy the futures market at 5721.3 and risk, let's say, £5 per point.
With this contract you make a profit of £5 for every point that the FTSE 100 index rises higher than 5721.3. Nevertheless, it also means that you will make a loss of £5 for every point that the FTSE 100 market moves lower than 5721.3.
Thinking of this in a slightly different way, if you are spread trading and you 'Buy' a market then your P&L is calculated by taking the difference between the settlement price of the market and the initial price you bought the spread at. You then multiply that price difference by the stake.
As a result, if, on the expiry date, the FTSE 100 settled higher at 5749.9, then:
P&L = (Closing Price - Opening Price) x stake
P&L = (5749.9 - 5721.3) x £5 per point stake
P&L = 28.6 x £5 per point stake
P&L = £143.00 profit
Trading UK stock market futures is not always easy. With this example, you thought the index would increase. Nevertheless, the UK stock market could fall.
If the FTSE 100 fell and settled lower at 5696.4, you would end up making a loss on this trade.
P&L = (Closing Price - Opening Price) x stake
P&L = (5696.4 - 5721.3) x £5 per point stake
P&L = -24.9 x £5 per point stake
P&L = -£124.50 loss
Note - FTSE 100 March Futures market correct as of 27-Sep-12.
Financial Spread Betting on FTSE 100 Companies
Simply click on the company you're interested in spread betting on.
As well as broker ratings, indicative prices and charts, we talk you through the most popular spread betting questions for the UK firm:
Below, an old but still useful case study on the UK stock market by Shai Heffetz, InterTrader, 28-Apr-2011.
Being an index of the 100 biggest companies on the London Stock Exchange, the FTSE 100 is considered a quite reliable yardstick of the health of the economy in general.
If one looks at the period since the index started at 1000 on the 1st of January 1984, the picture certainly looks healthy. The current value of 6041 represents growth of more than 500 per cent over the 27-year term.
The fact of the matter is, however, that the index is currently well below the record level of 6950.6 it reached in December 1999, which means that in effect we have seen negative growth over the past 12 years.
FTSE 100 Technical Analysis
If we consider technical analysis of the FTSE 100 then, looking at the Ichimoku Kinko Hyo on the candlestick chart below, everything seems to point to a bull market as the price is far above the cloud.
It is also well above the red Tenkan-Sen (short-term average) and the blue Kijun-Sen (longer-term average). The green Chinkou Span line is also well above the price 26 days ago, strengthening the perception of a bull market.
There are, however, a couple of things that could indicate that we should not jump to conclusions. The red Tenkan-Sen has turned flat, which indicates short-term uncertainty in the market, and the cloud is also very thin, which further points to indecisiveness in the market.
If the price should break through the recent high of 6064.80, we might see it test the previous high of 6106.80 it reached on 8 February. A cautious trader would not enter a medium or long-term position long position before this happens. A potential stop loss level in this case is the red Tenkan-Sen line.
In the current market, traders should wait for further signs of weakness before entering into a short position. If the price drops as far as the Ichimoku cloud, it could be on its way to test the previous low of 5505.30 on 16 March.
A careful trader will wait for the price to break downwards out of the cloud before going short, but this could rob you of most of the profits in the swing trade. An alternative, but riskier, approach would be to go short as soon as the price drops below the blue Kijun-Sen.
The London Stock Exchange (LSE) is one of the world's oldest stock exchanges. It's been trading for over 300 years. According to the LSE website it started life in the coffee houses of 17th century London (pre-Starbucks).
For readers who are not familiar with the term 'FTSE 100' it is simply an index of the 100 largest companies on the London Stock Exchange. The index is maintained and owned jointly by the Financial Times and the London Stock Exchange.
The index came into being on 1 January 1984 with a base value of 1,000. It reached a record level of 6950.6 on 30 December 1999. The financial crisis of 2007–2010 saw it drop dramatically to 3,500. Since then it has recovered to a large extent.
FTSE: Financial Times Stock Exchange. These firms (FT and LSE) are jointly responsible for the compilation and maintenance of the main stock indices reflecting the performance of the UK's top shares
FTSE 100: The index of the UK's top 100 companies, as ranked by their market capitalisation. Also referred to as UK100
FTSE 250 or FTSE MID 250: The index of the next 250 FTSE companies as ranked by their market capitalisation
FTSE 350: The index of the top 350 UK companies by market capitalisation. A combination of the FTSE 100 and FTSE 250 stocks
FTSE ALL SHARE: An index covering about 800 shares representing 98% of UK stock market value
UK 100: In spread betting and CFD trading, the FTSE 100 is often called the 'UK 100'
'FTSE 100 Spread Betting' edited by Jacob Wood, updated 29-Jul-14
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FTSE 100 Spread Betting
FTSE 100 financial spread betting guide with a price comparison and daily analysis. Plus live FTSE 100 charts & prices, where to spread bet on the stock market index commission-free and... » read from top.