FTSE 100 & FTSE 250 Index Both Post Losses On The Week – What Next?

The FTSE 100 gave back 1.19% on the week, as the FTSE 250 index lost 2.12% to continue what has been a poor start to June. London’s benchmark FTSE 100 index saw a modest decline to close the week, down by 0.21% to settle at 8,146.86 in the aftermath of the afternoon trading session on Friday.

The trend through June has not been much better, as the 250 index has given up 2.94%, against the 100’s more modest 1.55% loss. Whilst the broad UK indexes are trading down, there are some notable gainers, both on Friday, and on the month to date.

Weekly Gainers

One of the standout performers in the session was BT Group shares (LON:BT-A) , which experienced a rally for the second consecutive day. This surge in the telecom giant’s share price came on the heels of Mexican billionaire Carlos Slim’s acquisition of a 3.2% stake in the company. Slim’s investment stirred up the market, indicating investors’ confidence in BT Group’s business prospects. BT share price has now added 23% over the last month.

Tesco, the UK’s leading supermarket chain, was also in the limelight as it reported an encouraging 3.4% uptick in its first-quarter group sales, notably outpacing its counterparts. The company also saw an impressive rise in market share, which climbed by 52 basis points to stake a claim of 27.6% in the UK, outdoing its competitors and showcasing robust performance in the retail sector. Tesco shares (LON: TSCO) ended the day 2.64% to the good, and now trade just 0.16% below the June starting point.

Trending Downwards

Meanwhile, telecommunications heavyweight Vodafone made headlines with its plans to contemplate the sale of its considerable $2.3 billion holding in Indus Towers, an Indian telecom tower company.

Prospects of the disposal through block stock market deals in the coming week has kept market watchers and investors closely tuned in for subsequent moves. Shares of Vodafone (LON: VOD) have fallen 8.81% month to date, with the weekly performance enough to bring the stock negative also on a year to date basis (-1.15%).

Luxury fashion brand Burberry faced downward pressure on its shares (LON: BRBY), which fell by 3.35% on the day, to bring the month to date loss up to 7%. The drop is largely attributed to the growing concerns over China’s consumer demand for luxury items following reports of significant discounting by various brands in the sector. Investors are wary as this could suggest a broader trend of declining luxury goods sales in the important Chinese market. This trend has been going back some way, with the year to date performance of Burberry share price no doubt a concern to some holders, with the stock having lost more than 50% of it’s value.

What Next?

As you look under the surface, there are plenty of movers in either direction in UK markets, but the broad stroke trend remains negative over the past month. Comparing the FTSE 100, or the 250 against some of their US counterparts on a week to date basis does not do any favours. The tech heavy Nasdaq 100 has added 3.77% through the week, whilst the S&P 500 has gained 1.69%. There is some weight coming from tech, as we see the Russell 2000 index, and the DJIA both post minor losses under 1%.

Looking ahead to what we can expect for next week, we have the UK CPI report on Wednesday 19th, followed up the BoE rate decision on Thursday 20th. The week ends off with a host of economic data, with retail, manufacturing, and services numbers all coming in.

On the earnings calendar for next week we also have Ashtead Group, Berkeley, and CMC Markets marked out to watch. As to whether the upcoming week brings a shift in sentiment to kickstart the markets in June, we will have to wait and see. There are plenty of events that could swing things either way, a week not to miss.