The FTSE traded 0.78% lower on Wednesday at the back of disappointing earnings reports and a slight recovery in the pound. In the UK, the BOE meeting today will garner attention as market participants will want to know what the monetary policy outlook is under the newly elected PM Johnson and increasing concerns over Brexit’s outcome. In terms of data, look to Britain’s manufacturing PMI figure which is estimated to decline to influence the pound and in turn the FTSE. Moreover, we may see the FTSE react to yesterday’s FOMC meeting which delivered a rate cut but not so dovish message.
The FTSE extended losses on Wednesday as it fell by 59 points to end at 7586. The index reversed its rally above the 7620 level as it dipped below 7620 to reach the support at 7575 near the 20 period MA. A sustained move below 7600 would limit the upside on the FTSE while a break below the support at 7575 would target the 7545 level. Alternately a break above the resistance of 7620 would be required to indicate buying pressure and target the 7640 level.