Regency View:

Morning Report – Wednesday 7th July

FTSE to open at 7,112 (+12 pts)

This morning sees the European Commission release its economic growth forecasts and the market expects an upgrade with commission president, Ursula von der Leyen saying the region’s growth prospects were getting “better and better” in an interview last week.

And just before England kick-off at Wembley this evening, the minutes of last month’s Federal Reserve meeting will be released…

The U.S. central bank surprised the market last month by signalling they are planning for two rate increases in 2023 to combat inflationary pressures – sparking a sharp sell-off in the market. And yesterday’s weak price action on Wall Street suggests that the market is nervous as to what the minutes may reveal.

?Risk Barometer Explained

Yesterday’s price action saw the FTSE fail to breach resistance for a third consecutive session, this time the market fell away as Wall Street opened lower.

The range of yesterday’s candle completely engulfed the trading ranges of the previous two sessions, and this indicates that short-term momentum is now bearish.

As a minimum, we’d expect the market to test the 7,060 (first trendline) area.

FTSE 100 Daily Rolling Futures – Key Levels