FTSE 100 held back by falling utility shares
Worries about the utility sector and higher UK yields have hit the FTSE 100, but the Dow has risen following US bank stress test results, says Chris Beauchamp, Chief Market Analyst at online trading platform IG.
FTSE 100 stumbles on higher yields and utility fears
“The potential demise of Thames Water has investors running scared, and London’s listed utilities are under pressure as a result. Fears of a domino effect in the industry are at fever pitch, though no other specific names have yet been mentioned. But to add to that, UK yields are on the up once again, diminishing the attractiveness of dividend stocks, of which utilities make up a healthy constituency.”
Dow roars into life and moves back above 34,000
Yesterday’s mixed performance for the Dow has been replaced with a much more robust performance for the index. US banks have passed their stress tests with flying colours, so while yesterday was dominated by worries about what higher rates will do to the sector, today has been focused on their financial strength. Stronger GDP figures and lower jobless claims have also helped to restore some confidence in the outlook for US stocks.”
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