The opening of the UK stock market on Monday could have been a lot worse given how investors’ nerves were tested last week with a big sell-off linked to concerns over the strength of the global economic recovery.
A 0.6% decline to 7,081 is not great, but at least it isn’t on the scale of last week’s horrible session where the FTSE fell 1.7% in day.
Sadly, there is a repeat of the same stocks driving down the market – banks, miners and oil producers, all of whom are bellwethers for the state of the economy.
“Utilities and real estate were the only sectors in the FTSE 100 pushing ahead on Monday, whereas the FTSE 250 fared a bit better.
“The UK mid cap index avoided any sell-off and traded flat at 22,890, with real estate, consumer non-cyclicals, technology and financials as the strongest performing sectors,” says Russ Mould, investment director at AJ Bell.
“Among the top risers was investment JPMorgan Japanese, hitching a ride from a very strong showing from Japan’s Nikkei 225 index which advanced 2.25%. The Japanese government has taken action to control the spread of Covid in Tokyo during the Olympics and Japan’s Bon holiday period.
“In contrast, the UK is now only a week away from the so-called ‘Freedom Day’ where most of the remaining Covid restrictions will be dropped. However, there are growing fears that removal of these restrictions could lead to a resurgence in infections and put the country in a dangerous situation.”