The FTSE Finish Line: February 18 - 2025
Patrick Munnelly, Partner: Market Strategy, Tickmill Group
Following a slight increase early on, U.K. stocks pulled back somewhat and remained relatively muted in late trading on Tuesday, as investors processed the country's employment figures and corporate earnings reports. The benchmark FTSE 100 rose 0.03%. Information from the Office for National Statistics revealed that the UK's unemployment rate held steady in the fourth quarter, remaining at 4.4%, consistent with the previous period. Economists had anticipated an increase to 4.5%. In the three-month period ending in December, average earnings, excluding bonuses, rose by 5.9% annually, aligning with forecasts. Meanwhile, when including bonuses, earnings grew by 6%, surpassing economists' expectations of 5.9%. Additionally, data indicated that the number of payroll employees in January rose by 21,000 from the previous month and by 49,000 compared to the same month last year, reaching a total of 30.4 million. Earlier this month, the Bank of England reduced its key interest rate from 4.75% to 4.5%. Traders anticipate just two additional rate cuts for the remainder of 2025.
Single Stock Stories & Broker Updates:
Shares of BT Group Plc dropped by as much as 6.5% to 141.7p, making it the top percentage loser on the FTSE 100 index. Citi analysts downgraded the British telecom firm's stock from a "buy" rating to "sell," slashing the target price from 200p to 112p. The brokerage predicts a decline in revenue from Openreach, BT's network infrastructure division, starting in 2025/26 and persisting for the remainder of the decade. Additionally, Citi analysts expressed concerns about the long-term sustainability of BT Consumer's pricing strategy in the retail telecom services segment. Despite today's drop, the stock has risen approximately 34% over the past 12 months.
Shares of Serica Energy fell 10.4% to 129p after suspending operations at its Triton platform in the North Sea due to Storm Eowyn. Production is expected to resume mid-to-late March. CEO Chris Cox expressed frustration over the impact, following a strong recovery in 2024. The 2025 production outlook will be revised based on the situation. The stock had already fallen 41.1% in 2024.
Technical & Trade View
FTSE Bias: Bullish Above Bearish below 8400
Primary support 8400
Below 8400 opens 8225
Primary objective 8839
Daily VWAP Bullish
Weekly VWAP Bullish
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Patrick has been involved in the financial markets for well over a decade as a self-educated professional trader and money manager. Flitting between the roles of market commentator, analyst and mentor, Patrick has improved the technical skills and psychological stance of literally hundreds of traders – coaching them to become savvy market operators!