FTSE 100 index moves lower overnight amid UK's lockdown easing confusion
IG’s FTSE 100 pre-market estimates indicate that the benchmark is poised to open slightly lower on Tuesday.
UK benchmark FTSE 100 index traded down overnight, IG data show.
IG's FTSE 100 futures price estimates showed that the index fell as much as 1%, decreasing roughly 60 points to fall below 5910 as at 00:00 GMT on Tuesday 12 May 2020.
This reverses the gains that had been made during Monday 11 May’s session, when the Footsie had rallied some 50 points to conclude above 5950.
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Boris Johnson says UK’s lockdown to be relaxed in steps
On Monday, the FTSE rose after UK Prime Minister Boris Johnson announced his ‘road map’ to ease the ongoing coronavirus lockdown in stages.
In his speech, Johnson said: ‘We now need to stress that anyone who can’t work from home, for instance those in construction or manufacturing, should be actively encouraged to go to work.’
Step one starts from Wednesday 13 May 2020, when individuals are allowed to go out for unlimited exercise, while still being subject to current social distancing rules.
Step two, which will happen at the earliest by 01 June, will see the reopening of shops and primary schools. In step three, which will only happen at the earliest by July ‘if and only if the numbers support it’, parts of the hospitality industry and public paces will be reopened.
Mixed messages from other UK leaders
However, it appears the index was unable to sustain the latest bout of optimism, as confusion surrounding the easing soon surfaced.
Scotland’s First Minister Nicola Sturgeon even told media during a daily briefing that it was ‘too risky’ for Scotland to change restrictions, and that Johnson’s message applied only to England and Wales.
On the technical side, IG UK senior market analyst Joshua Mahony wrote that while ‘there are questions over the longevity of this rally’, he continues to expect an upside for the FTSE 100 ‘unless we see the 5928 level broken’.
For now, as at 06:40 GMT on Tuesday 12 May 2020, the FTSE 100 index has pared some of the overnight losses and is now trading at 5936, based on futures prices.
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