The FTSE 100 was treading water on Wednesday, floating around the 5,851 level as gains in the healthcare, telecoms and utilities sectors were offset by weakness in energy, technology and consumer cyclicals.
Investors seemed relatively cautious following April’s sharp rebound in global markets, perhaps weighed down by renewed tensions between the US and China and ongoing uncertainty about exactly when the coronavirus crisis will end.
A lot of hope is already priced into stocks and there is a growing feeling that earnings forecasts are being too optimistic, thus dampening some of the enthusiasm we’ve recently seen on the markets.
“Brent Crude also held firm at just over $31 a barrel, having also seen a big comeback since slumping in value during late April. The market is hoping that oil demand will start to recover as lockdowns ease and more companies get back to work,” says Russ Mould, investment director at AJ Bell.