The FTSE 100 is set to end the week more robustly than the US, as Britain’s leading stock index becomes a safe haven amid global market turmoil.
Despite being down as much as 3.2% earlier in the week due to US recession fears, the blue-chip index is up 0.2% today and may still end the week on a positive note.
In contrast, Wall Street is on track for significant declines this week, with megacap tech stocks being particularly hard hit since the sell-off began last Friday. The Dow Jones Industrial Average, S&P 500, and Nasdaq Composite all fell at the start of trading in New York today.
The FTSE 250 is up 0.4% today but is projected to end the week down 1.1%, a notable recovery from earlier losses of up to 4.2%.
JP Morgan strategist Mislav Matejka noted that Britain “is a good place to be in when activity is disappointing,” emphasizing that the UK market is traditionally low beta and defensive, performing well during downturns. He suggested that if global equities pull back this summer, the UK could be a relative winner.
European shares have nearly recovered all their losses since the global stock rout began over US recession fears.
Matt Britzman, senior equity analyst at Hargreaves Lansdown, commented, “We rarely get to say the UK’s been a benefactor of its low-tech exposure, but that’s certainly been the case this week.”
