Stocks in London are set to open higher on Wednesday as investors anticipate monetary policy easing measures from the European Central Bank on Thursday. There is no shortage of theories why equity markets are so resilient in the face of so much adversity. However, it may not be any more complicated than the fact global investors appear more than happy to run with the 'risk-on' squeeze on the back of the latest positive short-term developments around the prospect of a high-level Chinese trade delegation going to Washington in October; and anticipation of more central bank easing. Looking ahead, Prime Minister Boris Johnson has sought to shore up support for his Brexit ambitions, as Labour's deputy leader prepared to call for a second referendum before any general election. Today will also mark a deadline set by MPs for the government to publish communications connected to prorogation and no-deal Brexit planning.
FTSE ended Tuesday at 7268 gaining £32.15 after trading down £36.41 lower after the open. The 200-day moving average provided enough support to reverse the UK index during the session as bulls took control ending the day above its opening price. Closing within the previous day's range, prices failed to decisively move beyond the prior day's trading range in a lackluster session. It will interesting to see if yesterday's strong momentum will push the index through the 7320 key resistance level to test the 200-period moving average.