- The UK FTSE 100 dropped to a two-year low
- The arrest of Meng Wanzhou, the chief financial officer of Huawei Technologies sent the FTSE 100 down 2.3% at 6,760.28, hitting its lowest level since December 2016 by midday.
- The FTSE has closed at 6704.05 -3.15%.
The UK FTSE 100 dropped to a two-year low just before midday on Thursday, tied in with the broad-based market selloff that has roiled markets and sparked trade war fears once again over the arrest of Huawei's chief financial officer.
Sino/US trade relations continue to drive markets and just in the same week as it might have appeared that Trump and Xi had started to work on a solution to their year-long trade dispute, as ambiguous as the cease-fire was, cannons are being positioned forward once again.
The arrest of Meng Wanzhou, the chief financial officer of Huawei Technologies, by the Canadian authorities sent equities off a cliff and futures selling was so intense at one point that circuit breakers were triggered.
The impact sent the FTSE 100 down 2.3% at 6,760.28, hitting its lowest level since December 2016, with only five companies' shares in positive territory. (FTSE 250 was 2.8% lower at 17,769.11).
The straw that broke the camel's back
The chief financial officer of Chinese telecoms company faces extradition to the US over possible violations of sanctions against Iran and China has urged both Canada and the US to "rectify wrongdoing" which has markets to a cliff edge again on Thursday as investors fear that this will break the cease-fire as Beijing responds with demands that may come beyond the realms of tariffs and into much broader economic and diplomatic conflict, with dire implications for global economic growth.
FTSE technicals
The FTSE is deeper negative on the charts with a series of long-bodied candlesticks. The index is now testing S2 at 6665 with daily ATR steepening into a strong trend. RSI is barely into over sold territory with room to go as well. A break of S2 6550 and 6500 at Nov 4th 2016 lows a few points higher. On the flipside, the pivot point is located at 7017 - 7016 was a prior low. R1 is located at 7074 and the 2018 range 23.6% level is located at 7100. The 38.2% Fibo of 2018's range at 7262 is the primary objective thereafter.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended content
Editors’ Picks
EUR/USD consolidates weekly gains above 1.1150
EUR/USD moves up and down in a narrow channel slightly above 1.1150 on Friday. In the absence of high-tier macroeconomic data releases, comments from central bank officials and the risk mood could drive the pair's action heading into the weekend.
GBP/USD stabilizes near 1.3300, looks to post strong weekly gains
GBP/USD trades modestly higher on the day near 1.3300, supported by the upbeat UK Retail Sales data for August. The pair remains on track to end the week, which featured Fed and BoE policy decisions, with strong gains.
Gold extends rally to new record-high above $2,610
Gold (XAU/USD) preserves its bullish momentum and trades at a new all-time high above $2,610 on Friday. Heightened expectations that global central banks will follow the Fed in easing policy and slashing rates lift XAU/USD.
Week ahead – SNB to cut again, RBA to stand pat, PCE inflation also on tap
SNB is expected to ease for third time; might cut by 50bps. RBA to hold rates but could turn less hawkish as CPI falls. After inaugural Fed cut, attention turns to PCE inflation.
Bank of Japan set to keep rates on hold after July’s hike shocked markets
The Bank of Japan is expected to keep its short-term interest rate target between 0.15% and 0.25% on Friday, following the conclusion of its two-day monetary policy review. The decision is set to be announced during the early Asian session.
Moneta Markets review 2024: All you need to know
VERIFIED In this review, the FXStreet team provides an independent and thorough analysis based on direct testing and real experiences with Moneta Markets – an excellent broker for novice to intermediate forex traders who want to broaden their knowledge base.