FTSE flirts with record but dragged back by HSBC

The FTSE 100 index briefly reached record territory this morning before being dragged back down to earth by poor numbers put out by HSBC.

FTSE flirts with record but dragged back by HSBC

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The index jumped up to 6939 upon the opening of trading for the week, but was soon down to a less remarkable 6894.

A combination of brushing the symbolically important record level and HSBC’s falling profits were the principle reasons for the sell-off.  The multinational bank revealed this morning that profits had fallen 17% from last year to $18.7bn, resulting in a 5% drop in its share price.

 “The December 1999 all-time has become a major psychological barrier for investors in recent years,” said Adrian Lowcock, head of investing at AXA Wealth. “In the past two years the FTSE 100 has repeatedly come close to reaching a new all-time high’s and on 20 separate trading days it has come within 100 points.” 

“Each time it has been close to the all-time high level, the market has pulled back.  However, when looking at the FTSE 100 with dividends included, the FTSE 100 reached a new all-time high on January 2006 and has been repeatedly doing so since then.”

“An agreement with Greece to extend its current bailout by 4 months, a boost to the UK economy from lower oil prices and improved economic outlook could mean that 2015 is finally the year the FTSE 100 breaks through the barrier,” Lowcock added.  “Once through the market may well go on to set repeatedly new highs as we have seen happen in both the S&P 500 and the UK’s own FTSE 250 in recent years.”

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