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UK share prices drift as Greek, US worries persist
November 14, 2012 / 10:41 AM / 5 years ago

UK share prices drift as Greek, US worries persist

* FTSE 100 down 0.4 pct to 5,763.72 points

* Buy FTSE at 5,715, sell at 5,770 to benefit from range - HB

* Charts show index headed down after it failed to break resistance

* Sainsbury hit by profit takers as strong results were priced in

By Francesco Canepa

LONDON, Nov 14 (Reuters) - The FTSE 100 share index edged lower on Wednesday but keeping within its recent trading range, as worries continued over the U.S. economy and Greece’s protracted debt crisis and some investors took gains made in the previous session.

The London market’s blue-chip index was down 0.6 percent at 5,754.08 points at 1031 GMT, trapped between support at a two-month low in the 5,710 area, which triggered rebounds twice in the previous three sessions, and this week’s resistance at around 5,785.

Investors were awaiting progress on talks aimed at giving Greece its much needed infusion of aid, while also looking across the Atlantic to the political wrangle in Washington where government and opposition politicians need to find agreement to avoid pushing the economy over a fiscal cliff of automatic spending cuts and tax increases in the new year.

“We’re at the behest (of) news from Greece ... and the U.S. fiscal cliff,” Dan Reed, a trader at HB Markets said.

Given the uncertain long-term prospects, Reed recommended trading the FTSE on an intra-day basis, buying at around 5,715-5,720 points and selling at 5,770-5780 points.

Charts on the FTSE’s December futures contract, down 0.2 percent at 5,755 points, pointed to declines within the recent range after the contract failed to break above a high of 5,777 set on Friday and tested again earlier this week

“We’re on the bear track for now,” Clive Lambert, a technical analyst at Futures Techs. “We’ve seen a couple of reversal candlesticks in the last few sessions but we’re yet to retake that 5,777 level that would confirm those.”

He said the index futures contract was heading for Tuesday’s low at 5,792, but it could fall as low as 5,758, which is the 48.2 percent of the rally between June and September, if that support was broken.

Weighing on the FTSE on Wednesday was a slip in supermarkets retailer J Sainsbury’s shares, down 1.5 percent at 341 pence, with traders saying they were taking profits on the stock as the group’s strong first-half results had already been priced in.

They also flagged concerns that key shareholder the Qatari Investment Authority may be close to selling its 25.9 percent stake in the group.

Reed said the stock’s 30 percent rally in four months fully reflected the company’s strength and he had closed his positions in the group at and above 355 pence after the stock had failed to break above a 16-month high at 360 pence.

On the upside, shares in Prudential surged after Britain’s biggest insurer reported a 13 percent rise in profit, narrowly beating market expectations, thanks to continued strong growth in its flagship Asian markets.

Shares in the firm rose 1.1 percent, having already traded more than half of their full-day volume average. (Editing by Greg Mahlich)

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