{"id":40636,"date":"2025-06-13T11:36:15","date_gmt":"2025-06-13T11:36:15","guid":{"rendered":"https:\/\/quickassetsmarket.com\/index.php\/2025\/06\/13\/ftse-100-index-v-shaped-recovery-faces-crucial-test\/"},"modified":"2025-06-13T11:36:15","modified_gmt":"2025-06-13T11:36:15","slug":"ftse-100-index-v-shaped-recovery-faces-crucial-test","status":"publish","type":"post","link":"https:\/\/quickassetsmarket.com\/index.php\/2025\/06\/13\/ftse-100-index-v-shaped-recovery-faces-crucial-test\/","title":{"rendered":"FTSE 100 Index V-shaped recovery faces crucial test"},"content":{"rendered":"
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The FTSE 100 Index continued its uptrend this week as economic data released by the Office of National Statistics (ONS) pointed to a potential interest rate cut by the Bank of England (BoE). It rose to a high of \u00a38,885 on Thursday, a few points below the year-to-date high of \u00a38,900, and 16% above the lowest point in April.<\/p>\n

BoE rate cut hopes boost the FTSE 100 Index<\/h2>\n

The Office of National Statistics (ONS) published relatively weak economic numbers, pushing analysts to predict that the Bank of England will cut interest rates soon. <\/p>\n

A report released on Thursday showed that the British economy grew by 0.9% in April, a drop from the expansion of 1.1% in the same period last year. It contracted by 0.3% on a month-on-month basis.<\/p>\n

More data showed that the goods trade deficit rose by \u00a323.21 billion in April from \u00a319 billion in the previous month. The non-EU goods trade deficit widened to \u00a38.6 billion.<\/p>\n

Further, the UK industrial and manufacturing production weakened during the month. And on Tuesday, a report by the ONS showed that the labor market softened in April.<\/p>\n

These numbers mean that the BoE will likely cut interest rates next week<\/a>. This explains why UK Gilt yields plunged this week. The 10-year yield dropped to 4.474%, its lowest level since May 8, and lower than the YTD high of 4.817%.<\/p>\n

Similarly, the five-year yield tumbled to 3.988%, down from 4.27% in May. Falling bond yields signal that investors anticipate that the central bank will slash interest rates in the future.<\/p>\n

The stock market performs well when bond yields are falling because of the rotation to equities from the low-yielding bond market.<\/p>\n

Top UK stocks of the week<\/h2>\n

Many FTSE 100 Index stocks were in the green this week. Fresnillo stock jumped by 12%, bringing the year-to-date gains to 127%. This surge happened as the silver price<\/a> <\/strong>continued rising and hit its highest level in over a decade.<\/p>\n

BP share price jumped by 11% as crude oil price<\/a> <\/strong>surged and rumors of a takeover continued. The biggest news during the week was that Adnoc, a UAE energy giant, was considering buying some of the company\u2019s assets. Analysts warn that a full takeover will be unlikely because of its size and complexities.<\/p>\n

UK home builders like Persimmon, Taylor Wimpey, and Barratt Development surged by over 8% and were among the best-performers in the FTSE 100 Index. These stocks jumped as UK bond yields dropped, which may trigger more demand.\u00a0<\/p>\n

The other top gainers in the FTSE 100 Index were companies like Halma, Shell, British American Tobacco, BT Group, and Prudential.<\/p>\n

On the other hand, the top laggards were companies like Anglo American, EasyJet, JD Sports, Diageo, and Babcock International.<\/p>\n

FTSE 100 Index analysis: faces major test<\/h2>\n
FTSE 100 Index chart | Source: TradingView<\/a><\/figcaption><\/figure>\n

The daily chart shows that the FTSE 100 Index has formed a V-shaped recovery as it jumped from a low of \u00a37,543 on April 7 to a high of \u00a38,885. It has jumped above all moving averages, while the MACD and the Relative Strength Index (RSI) have continued rising. <\/p>\n

This V-shaped recovery is now facing a major test as it nears its highest point on March 3. It needs to move above that level to invalidate the double-top pattern that has been forming. A break above that level will point to more gains to \u00a39,000. The alternative scenario is where it pulls back and retests the 200-day moving average at \u00a38,642.<\/p>\n

Read more:  CAC 40 and DAX indices have crashed: buy the dip?<\/a><\/p>\n

The post FTSE 100 Index V-shaped recovery faces crucial test<\/a> appeared first on Invezz<\/a><\/p>\n

<\/p>\n","protected":false},"excerpt":{"rendered":"

The FTSE 100 Index continued its uptrend this week as economic data released by the Office of National Statistics (ONS) pointed to a potential interest rate cut by the Bank of England (BoE). It rose to a high of \u00a38,885 on Thursday, a few points below the year-to-date high of \u00a38,900, and 16% above the <\/p>\n","protected":false},"author":1,"featured_media":40637,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[4],"tags":[],"class_list":{"0":"post-40636","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-world"},"_links":{"self":[{"href":"https:\/\/quickassetsmarket.com\/index.php\/wp-json\/wp\/v2\/posts\/40636","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/quickassetsmarket.com\/index.php\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/quickassetsmarket.com\/index.php\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/quickassetsmarket.com\/index.php\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/quickassetsmarket.com\/index.php\/wp-json\/wp\/v2\/comments?post=40636"}],"version-history":[{"count":0,"href":"https:\/\/quickassetsmarket.com\/index.php\/wp-json\/wp\/v2\/posts\/40636\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/quickassetsmarket.com\/index.php\/wp-json\/wp\/v2\/media\/40637"}],"wp:attachment":[{"href":"https:\/\/quickassetsmarket.com\/index.php\/wp-json\/wp\/v2\/media?parent=40636"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/quickassetsmarket.com\/index.php\/wp-json\/wp\/v2\/categories?post=40636"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/quickassetsmarket.com\/index.php\/wp-json\/wp\/v2\/tags?post=40636"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}