Market Rally Running Out of Steam?


LONDON, July 9, 2012 /PRNewswire/ —

June proved to be a bullish month for stock markets, with investors buying back into the market after three previous months of declines as Central Banks looked to stimulate a slowing global economy.

In June, the FTSE 100 gained 251 points or 4.7%.

However, having hit resistance at the 5700 level at the end of last week, will the FTSE’s charge start to run out of steam? By close of play in the UK on Friday (July 6), all the major indices were firmly in the red, with the Dow Jones leading the way as it fell by over 150 points (over 1%) by 4.40pm (BST). Major indices in the UK and Europe recorded falls too, with the FTSE 100 shedding 30 points and Germany’s DAX 30 sliding by over 125 points to close the week at 5662.6 and 6410.1 respectively.

Luckily for some, spread betting is a viable alternative to conventional trading, making it possible for traders to profit from rising as well as falling markets – an excellent option during volatile market conditions such as the present.

More falls expected this week?

Last Friday’s dip in market sentiment was caused largely by the release of worse than expected non-farm payroll data in the US, which showed the country’s unemployment rate remaining unchanged at 8.2% in June but the number of new jobs was disappointing, with a total of 80,000 new payrolls being added to the economy against expectations of 90,000. Private payrolls also failed to recover, adding just 84,000 jobs against expectations of 102,000.

In the UK, meanwhile, the Barclays Libor scandal continued to fray nerves after the Serious Fraud Office launched an official investigation into the rate-fixing controversy.

Globally too, sentiment was sombre, with International Monetary Fund chief Christine Lagarde revealing that the IMF will be revising its growth forecast for the global economy lower from the current 3.5%.

With spread betting, it is possible to profit irrespective of whether the markets are moving up or down, meaning that traders can net a profit even when markets are on the decline. Find out more about the benefits and risks of spread betting.

All you have to do is determine whether you expect market prices to rise or fall in the coming days. If you expect that prices will rise, you take a long position and if you expect prices to fall, you go short. You will profit so long as you were right and markets move in the direction you had speculated. If you were wrong, you would net a loss. Learn to spread bet with financial spread betting provider Finspreads.

Spread betting is a leveraged product which can result in losses greater than your initial deposit. Ensure you fully understand the risks.

*Spread betting is exempt from UK stamp duty and Capital Gains Tax (CGT). However, tax laws are subject to change and depend on individual circumstances. Please seek independent advice if necessary.

About Finspreads:

Finspreads is a leading online financial spread betting firm, offering access to thousands of instruments on the world’s financial markets.

The company pioneered fully interactive online spread betting in 1999 and continues to invest in technology to ensure that its service remains amongst the market leaders.

SOURCE Finspreads

Leave a Reply