FTSE Rattled by Positive Employment Data, Bullish AI Sentiment

UK stocks off to a volatile start on Tuesday, as investors battle with Mixed jobs data and bullish AI sentiment leading global stocks higher

Gino Bruno D'Alessio•Tuesday, August 13, 2024•2 min read

ftse volatile on mixed jobs data and ai bullishness

UK stocks off to a volatile start on Tuesday, as investors battle with Mixed jobs data and bullish AI sentiment leading global stocks higher.

The UK added 97k jobs in the last month up from 17k new jobs previously, but unemployment claims jumped to 135k when analysts had expected only 14.5k. While AI bullishness has sent the NAS100 up by 0.80% this morning and the NIKKEI225 up 1.95%.

Positive UK employment data shows signs of a healthy economy and may be cause for the BoE to pause longer before their next rate cut. However, a large rise in unemployment claims means the picture may not be as rosy.

Fears of a delay in the central bank’s monetary policy easing cycle and the strong performance from tech stocks globally have been this morning’s factors sparking volatility. The FTSE has gone from trading down 0.20% to up 0.30% within an hour after the jobs data.

Eyes move to Wednesday’s CPI data from the US as concerns of higher prices might delay the Fed’s first move on interest rates. The global stock market has come to the consensus that the Fed most likely will cut rates at its meeting in September.

Technical View

The day chart below for the FTSE shows a market in a down-trend, with the last 5 candles forming a correction from the low August 5, to 7,910 (grey line). The current candle has found resistance from the Ichimoku cloud (pink area).

volatility in uk stock market

A close on today’s candle below the cloud should lead to further downward price action. The next support level is at 8,036 (black line), which coincides with a support level from April. Should that level of support break, the next support level is at 7,910 (grey line).

To consider the market as back in a bull trend, we would need to see a close above the cloud and above the resistance level at 8,278 (blue line).

FTSE

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ABOUT THE AUTHOR See More

Gino Bruno D'Alessio

Gino D’Alessio is a professional Forex trader with 20+ years of experience in the financial markets as a broker-dealer. Having worked in New York and London, Gino is regularly featured on Seeking Alpha. He completed the CAIA program in 2015, which also gave great insight into global macro factors. His main focus is FX majors, indices and commodities.