UK companies publish good quarterly earnings reports
The UK’s withdrawal from the European Union without signing a mutual agreement may support an increase in stocks of British companies. Will the GB100 rise?
The weakening of the pound increases the competitiveness of UK companies in foreign markets. The FTSE 100 stock index rose on Friday for the 4th consecutive day. Its growth during a week has been the highest since December 2016. Last week, the British pound showed the maximum decline in the last 7 weeks in anticipation of the next vote in the British Parliament regarding Brexit. It should take place on February 13. The UK’s exit from the EU is scheduled on March 29, 2019. Market participants believe that the Bank of England will support national companies and maintain its super-loose monetary policy at the next meeting on February 7. Additional positive factors for the British stock index were good earnings reports for the 4th quarter of such large companies as Royal Dutch Shell and Diageo. Let us note that the FTSE 100 is now trading with a relatively low P/E ratio of 11.2.
On the daily timeframe, GB100: D1 has moved from the downtrend to the uptrend. The further price increase is possible in case of the publication of positive quarterly earnings reports of UK companies and good political news.
Summary of technical analysis
Position Buy
Buy stop Above 7040
Stop loss Below 6700
The UK’s withdrawal from the European Union without signing a mutual agreement may support an increase in stocks of British companies. Will the GB100 rise?
The weakening of the pound increases the competitiveness of UK companies in foreign markets. The FTSE 100 stock index rose on Friday for the 4th consecutive day. Its growth during a week has been the highest since December 2016. Last week, the British pound showed the maximum decline in the last 7 weeks in anticipation of the next vote in the British Parliament regarding Brexit. It should take place on February 13. The UK’s exit from the EU is scheduled on March 29, 2019. Market participants believe that the Bank of England will support national companies and maintain its super-loose monetary policy at the next meeting on February 7. Additional positive factors for the British stock index were good earnings reports for the 4th quarter of such large companies as Royal Dutch Shell and Diageo. Let us note that the FTSE 100 is now trading with a relatively low P/E ratio of 11.2.
On the daily timeframe, GB100: D1 has moved from the downtrend to the uptrend. The further price increase is possible in case of the publication of positive quarterly earnings reports of UK companies and good political news.
- The Parabolic indicator gives a bullish signal.
- The Bollinger bands have narrowed, which indicates low volatility. Both Bollinger bands are titled upwards.
- The RSI indicator is above 50, but it has not reached the overbought area yet. No divergence.
- The MACD indicator gives a bullish signal.
Summary of technical analysis
Position Buy
Buy stop Above 7040
Stop loss Below 6700