FTSE 100: Buoyant weekend outlook as euro recovery hopes rise
Amid overdue positive news regarding the UK and European economies, the FTSE 100 weekend forecast looks optimistic, with major shares continuing to perform well.
After a strong day of trading in London, all signs point towards a buoyant weekend for the FTSE 100, following a spate of positive economic news that has left analysts and investors cautiously optimistic.
The FTSE got off to a strong start as markets opened this morning, opening 11.3 points higher, at 6261.82, and continuing to rise steadily throughout the day, closing at 6290.
While there was little corporate news throughout the day to guide trading, it is clear that positive developments both in the UK and across the Channel in Europe have played a role in pushing shares higher.
Let's take a closer look at why the FTSE forecast for the weekend looks set to be more promising than what we have seen in previous weeks.
UK economic analysts remain cautiously optimistic
Although the hoped-for 'V-shaped' economic recovery following the current recession does not look like it will materialize, there has been some good news. UK GDP was found to have grown modestly in May, rising 1.8%.
Although this is less than was originally expected, there are hopes that growth figures for June and July will be much more robust, following the significant easing of lockdown measures that occurred throughout these months.
GDP in Scotland was also revealed today to have rebounded in May, with the official growth rate from the Bank of Scotland suggesting a rise of 1.5%.
Today, the FTSE continued to tick upwards as Prime Minister Boris Johnson outlined the Government's 'return to normality' plan, which involves the reopening of live music venues, theatres, casinos, ice skating rinks, bowling alleys, and more in two weeks' time.
It was also revealed that employers will no longer have to allow for remote working, and will be able to make the decision themselves as to whether or not to allow employees to come into work. Johnson said this afternoon that the Government's plan is for the UK economy to return to 'full normality' by Christmas.
Among the biggest risers today was the pharmaceutical giant AstraZeneca, which jumped 3.88% over the course of the day following positive developments on the Covid-19 vaccine it is helping to develop with Oxford University.
Investors are clearly feeling more confident in the UK economy, given that the FTSE outperformed all major European markets on Friday and looks set to continue doing so across the weekend.
Positive signs of Eurozone recovery ahead
Another factor that has been attributed to the FTSE's strong performance today has been the commencement of talks at the EU budget summit, where European leaders are attempting to hash out the details of a €750 billion economic recovery plan that would likely include significant stimulus packages for businesses and consumers.
Although talks have gotten off to a somewhat tepid start, investors are confident that they will bear fruit, given the strong political will within the European Commission to strike a deal quickly.
It is this optimism that helped push the Euro up 5% against the dollar and helped to buoy investor confidence here in the UK. Talks in the European Commission are expected to continue across the course of the weekend, so these will be worth keeping track of for anyone hoping to trade on the FTSE over Saturday and Sunday.
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