The FTSE finally made a decisive move, breaking lower on the session to complete a small top pattern. Further downside is now expected in the short term as a corrective phase is now likely. The preferred trade today is to sell into strength towards 7480.
U.K. stocks fell Wednesday, driving to intraday lows as a better-than-expected reading on British economic growth after a run of poor data drove the pound up against the U.S. dollar and the euro. The FTSE 100 index fell 0.5% to 7,497.13, led by basic material and utility shares. But the consumer goods group rose modestly. On Tuesday, the London benchmark rose less than 0.1%, ekeing out a third straight gain. It was also the third session in a row that closed with a move smaller than 0.1%. The flash reading of GDP for the third quarter from the Office for National Statistics showed quarter-over-growth of 0.4%, which was above the 0.3% forecast from a FactSet poll of economists. Year-over-year growth of 1.5%
met expectations. The report arrived before policy makers at the Bank of England release their decision on their next move for interest rates, on Nov. 2. The pound leapt to an intraday high of $1.3203 after the GDP report, up from $1.3133 late Tuesday in New York. Against the euro, sterling fetched €1.2114, a rise from €1.1167 in the previous session.
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