FTSE recovery continues as UK Index charges another 1% higher
City Index March 21, 2011 9:20 PM
<p>Investors remained on the front foot in trading to help to maintain the FTSE 100’s recovery from the three-month lows that were hit at the […]</p>
Investors remained on the front foot in trading to help to maintain the FTSE 100’s recovery from the three-month lows that were hit at the height of the uncertainty over Japan’s nuclear crisis. Those uncertainties, along with the situation in Libya remain, but investors have notably been more ‘asset hungry’ at least in the short term having seen stocks come off by so much and have been hunting for bargains. It is this bargain hunting that has helped to drive stock valuations higher and helped the FTSE 100 to recover some 3.3% in the last three sessions.
Near term resistance on the FTSE 100 lies around the 5875 mark and so it could well be here that traders need to make a decision as to whether the recent bullish recovery from monthly lows is short term or not.
Traders have also taken confidence from Warren Buffett, the ‘Oracle of Omaha’, who said that the recent heavy stock falls in Japan represented a buying opportunity.
The price of crude oil however remains particularly sensitive to the situation in Libya and the Middle East. The developments over the weekend, where coalition forces have launches a series of strikes on Gaddafi’s forces, have kept trader sensitivities high, and this has nudged the price of crude oil higher by 1%. The price of crude oil could be set for some added volatility should civilians within Bahrain or Saudi Arabia use the situation in Libya as extra motivation to protest for regime change, knowing that they could have the backing of western states should any violence get out of control.
Telecom shares leap on AT&T deal to buy T-Mobile
Telecom shares have leapt higher in European trading this morning after US firm AT&T agreed a deal over the weekend to buy T-Mobile for $39 billion. Shares in Deutsche Telekom, the owner of T-Mobile, have jumped 16% in early trading on the news after the firm announced that the sale would give it ample opportunities for share buy backs. Shares in industry peers have also rallied on the back of the deal, with Vodafone shares topping the FTSE 100 leader board, rallying 4% to 176.5p.
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