FTSE Slips From Two Month High

Thu, 22nd Dec 2016

Tuesday saw the FTSE 100 slip back from a two month high on Wednesday, with the FTSE250 also struggling. Shares in defence technology company QinetiQ bucked the trend, after the company announced that it had signed a deal to buy the targeting systems business from Meggitt, in a deal that was worth £57.5 million. After news of the deal broke, Meggitt’s shares fell by 1 percent.

Meanwhile, crude oil prices edged higher. This is usually good news for oil shares but this time results were mixed, with BP trading 0.4 percent higher, and Shell shedding 0.6 percent. Jasper Lawler, a senior market analyst for the London Capital Group explained that some of the lost ground could be explained by some investors engaging in profit taking as we head to the year-end. He noted that a finish of over 7,000 for the year could provide the markets with a psychological boost, that would help to get the markets off to a strong start, and potentially propel it to a fresh record high in 2017.

Overall, the trading day was a relatively subdued one with low trading volumes. Analysts are hopeful that Thursday afternoon will offer more movement, as the final GDP quarter for the US third quarter is due to be released.

In other news, the pound remained relatively flat against both the dollar and the Euro, another sign of the low activity being seen on the wider markets in the run up to the holidays.

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