It was a day of light trading and little movement on the London Stock Exchange. The FTSE 100 and FTSE 250 indices both registered small losses by the close of the day. The benchmark FTSE 100 lost 32 points, or 0.5%, to close at 5,833. The FTSE 250 index, which tracks mid-cap companies, dipped by 6 points, or less than 0.1%, to close at 11,498. Both of the FTSE indices rose by more than 0.5% in the previous trading session.
“The FTSE 100 lost some ground alongside European indices, which retraced from recent four-month highs as traders locked in some gains or stayed on the sidelines,” explained Joshua Raymond, chief market strategist at City Index. “It has been a day of low volumes, with the majority of traders refraining from taking much action.”
According to Raymond, many traders and investors have been bidding stocks higher over the last few weeks “as a direct result of optimism towards Central Bank action,” such as quantitative easing or other stimulus measures. Now, “eyes are starting to turn to the annual Jackson Hole meeting in Wyoming on 26 August where Central Bankers [will] meet,” said Raymond. “It is hoped that from this meeting traders may be able to gauge more transparently prospects for additional stimulus.”
While the UK markets were generally placid, one particular company stood out from the crowd as its shares shot higher. Standard Chartered’s (STAN) stock was in demand after the global banking giant confirmed that it paid $340 million to settle charges levied by New York’s main banking regulator. Investors had previously been concerned about worst-case scenarios, which could have involved a much larger fine or the loss of the bank’s New York banking licence, after Standard Chartered was accused of hiding financial dealings with Iran. While investors were relieved about the settlement, Morningstar analyst Erin Davis points out in her latest research report that “other US regulators were not part of the settlement, and additional charges may still be forthcoming.”
On the losing side of the FTSE 100, Eurasia Natural Resources (ENRC), along with various other mining companies saw their shares tumble. In particular, Eurasia’s shares plunged by 8.5%.
