FTSE edges higher as US earnings season gathers pace

The FTSE 100 edged higher in morning trade on Monday as investors started to focus on a swathe of major US company earnings this week.

A stronger mining sector lead by gains in ENRC and Vedanta Resources, which were both boosted by a positive note from broker Citigroup, and UK bank Lloyds helped to give a heavyweight boost to the UK index. The FTSE 350 mining and banking sectors both rallied 0.4% early on as a result but in truth it was a fairly choppy start to trading as investors start to get used to unfamiliar territory with the index trading above 6100.

There will be a big focus on earnings this week from both the US and UK. We have major US blue chips Goldman Sachs, Citigroup, JP Morgan and Intel all reporting this week which closer to home, UK retailers continue to report their respective numbers for the holiday trading period including Burberry Group and Home Retail Group.

Industrial production figures from the Euro zone disappointed with output falling 0.3% when a meagre gain of 0.1% had been expected. The surprising fall was balanced by a revision to the previous months 1.4% decline, which was narrowed to a decline of 1%.

The lack of economic data and companies reporting today dictates a somewhat slow start to the week with investors focusing on developments later in the week. We have UK inflation and US retail sales figures out tomorrow, whilst Chinese GDP figures will also play a significant influence on how UK listed miners trade on Friday. UK retail sales data is released on Friday morning.

For today however, traders may simply be going through the motions and position trading for the heavy calendar of earnings and data that lies ahead.

It remains crucial for the FTSE 100 to consolidate above the 6100 level this week whilst near term resistance lays at the 6130 level.