- The FTSE Price Is On A Bullish Trend
- Strong Growth Figures Give A Boost to the blue-chip index
- Coronavirus concerns still present as cases start rising
The FTSE price is currently on a roll having increased considerably over the last four days. In fact, the index is up by around 1.5% from the beginning of the week. Although Coronavirus concerns are still around, it appears that the 2nd quarter GDP growth figures indicating a 4.8% rise have been quite a boon to the FTSE.
The UK100 index is expected to continue its bullish trend over the next weeks as the economy continues to re-open. Another issue on the horizon is the consistently rising inflation which has also peaked in the United States at its highest levels since 1992. Investors have largely shrugged off these concerns as the travel industry and other service industries start recovering to pre-pandemic levels.
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Short Term Prediction For FTSE Price: Looking Bullish As The Economy Re-opens
The short-term outlook for the FTSE price remains quite bullish. It is expected to retain a weekly close increase of around 1.5% to settle at the 7250 level. The price is expected to continue rising over the next weeks with the 7500 mark the next resistance point on the horizon.
A bearish prediction would have the FTSE descend below the 7100 level and perhaps even test the 7000 mark. However, that seems unlikely with the recent results on GDP growth and the constant opening up of the travel sector.
As the markets continue to digest the economic data, it does seem that the UK economy is finally opening up at quite a fast rate. Coronavirus concerns remain but so far the much-predicted explosion of cases has not materialized.
A Note ON UK GDP Figures: Encouraging but Still Far From Pre-Pandemic Levels
The UK gross domestic product is estimated to have increased by around 4.8% in Quarter 2. This follows the easing of Covid19 restrictions. The monthly estimates that were published yesterday demonstrate that GDP was up by 2.2% in April, 0.6% in May and 1% in June.
The level of GDP in the whole of the UK is now 4.4% below where it was before the coronavirus pandemic hit at the end of 2019. Although these figures are encouraging, they are still somewhat behind what is required to get back to pre-pandemic levels.
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Long Term Predictions For FTSE price: Growth is expected to continue
Although the economy is still under some strain due to inflation and the Covid19 pandemic, the FTSE is expected to continue bullish as re-opening continues. The next target for the FTSE is 7500 after which an upward trajectory should be expected.
There continue to be pitfalls such as a possible resurgence in Covid19 cases although there have been hints that there will be no return to lockdowns again. All in all, investors are looking positively at the FTSE future.
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Gerald Fenech
