Regency View:

UK Sector Snapshot

Banking and Oil & Gas have been treading water in a small sideways range for the last week. Unsurprisingly, given the combined market cap weighting of these two sectors, the FTSE 100 is also treading water in a tight range.

Metals & Mining continue to show impressive levels of strength and the sector composite index is breaking to new highs today – the only sector to do so.

Another notably strong sector is Utilities, with SSE and United Utilities rallying over the last week.

The dual strength that we’re seeing ‘risk on’ Metals & Mining and ‘risk off’ Utilities highlights the levels of uncertainty and indecision that currently exist in the market. Will QE-driven inflation create a mining boom? Or should we be buying defensive utilities to protect against another sharp sell-off?

At the moment, traders are doing both, but only one of these strategies will pay off.

FTSE 100 Key Sector Snapshot