FTSE 100 FINISH LINE 19/5/26
FTSE 100 FINISH LINE 19/5/26
Labour Cracks: Stocks Caught a Brief Reprieve Before Reversing
The FTSE 100 initially found a firmer footing on Tuesday, with the equity tape giving investors some breathing room after a politically bruising stretch. The rally came despite a softer UK labour market print, as tax office data showed that April payrolls fell by 100,000 from March while the unemployment rate ticked up to 5.0% in the first quarter from 4.9% in the three months to February. The data reinforced the sense that the domestic economy is losing momentum, even as selected equity sectors found buyers. The labour report sharpened the Bank of England's debate. The figures would not only make for uncomfortable reading but would likely stop the MPC in its tracks, while LSEG data showed traders pricing only a 29.1% chance of a June rate hike. Markets expect a hike next month, although it is far from guaranteed. For markets, the main point was that weaker employment may ease pressure on the BoE to tighten aggressively, providing some relief to duration-sensitive and consumer-facing stocks, even if it also suggests a weaker growth backdrop.
Politics remained a live overhang. Monday’s reassurance from Prime Minister Keir Starmer that he intends to stay in post did little to fully settle nerves, with several Labour lawmakers still calling for him to quit. That kept the Westminster risk premium alive, but today’s price action suggested investors were willing to overlook the noise where earnings momentum was strong. The reprieve in equities did not herald political calm; it was a selective bounce after the market had already heavily discounted uncertainty. Sector leadership was punchier. Investment banking shares rose 2.58%, while retailers advanced 2.49%, pointing to renewed appetite for cyclical and market-sensitive exposure as rate expectations softened. The standout single-stock move came from IG Group, which surged 10.22%, the biggest gain on the FTSE 100, after raising its annual and medium-term revenue forecasts for the second time this year. That upgrade gave investors exactly what they have been rewarding in this market: tangible earnings momentum, self-help delivery and visibility beyond the macro fog.
Finish Line: Although the FTSE crossed higher early Tuesday, it retreated into marginally negative territory by the close, in line with a reversal seen Stateside. The early rally was suspect, coming against a backdrop of rising unemployment and unresolved Westminster tension — enough for a breather, but not yet enough for a clean UK re-rating.
TECHNICAL & TRADE VIEW – FTSE100
Daily VWAP Bullish
Weekly VWAP Bullish
Above 10500 Target 11000
Below 10100 Target 9469
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Patrick has been involved in the financial markets for well over a decade as a self-educated professional trader and money manager. Flitting between the roles of market commentator, analyst and mentor, Patrick has improved the technical skills and psychological stance of literally hundreds of traders – coaching them to become savvy market operators!