Market News & Analysis

Top Story

FTSE Tanks Despite Sunak's Blowout Bailout

The bloodbath is resuming on Wednesday. After recording gains of 2.7% in the previous session, the FTSE is plunging lower in early trade as the Chancellor’s blowout bailout has failed to maintain any level of positivity in the markets.

Chancellor Rushi Sunak announced a £330 billion rescue package to help struggling businesses cope with the economic impact of coronavirus. The bailout package aims to keep Britain afloat and offers a lifeline to those businesses that the governments stricter social distancing, isolation and quarantine measures will negatively impact.

Consumption will drop severely as people stay in their homes. Restaurants, shops and pubs will be hard hit so the Government announced a one-year break from business rates, as well as government grants of up to $25,000 will help to alleviate the pain. Banks have also agreed to give struggling customers a mortgage holiday of up to three months. An additional support package for the badly hit airlines will be announced in the coming days.

Yet despite Chancellor Rishi Sunak’s colossal bailout package the markets’ response is very concerning. The fact that the FTSE has failed to hold onto any of the gains quite simply suggests that this is not enough. There needs to be a coordinate global response, which up to now hasn’t happened.  As a result, the markets are vulnerable to further fallout. 

What next?
Eyes are now turning to the European Stability Mechanism and what more the White House can bring to the table. 
With fear driving the markets and coronavirus numbers escalating, there is a good chance that this overly bearish picture won’t show any signs of improvement until the coronavirus numbers themselves start to improve.

Levels to watch
The FTSE is trading down 3.9% at 5088 the time of writing. It trades below 50,100 and 200 sma on 4-hour chart, a bearish chart. 
The price found support for a second straight session just shy of 5000. Immediate support is at 4996 (today’s low), prior to 4987 (yesterday’s low) before 4840 (16th March low).
Resistance can be seen at 5370 (yesterday’s high) A break above this level is needed to negate short term bearish trend. Resistance is then seen at 5700 (13th March high).


This report is intended for general circulation only. It should not be construed as a recommendation, or an offer (or solicitation of an offer) to buy or sell any financial products. The information provided does not take into account your specific investment objectives, financial situation or particular needs. Before you act on any recommendation that may be contained in this report, independent advice ought to be sought from a financial adviser regarding the suitability of the investment product, taking into account your specific investment objectives, financial situation or particular needs.

GAIN Capital Singapore Pte. Ltd., may distribute reports produced by its respective foreign entities or affiliates within the GAIN Capital group of companies or third parties pursuant to an arrangement under Regulation 32C of the Financial Advisers Regulations. Where the report is distributed to a person in Singapore who is not an accredited investor, expert investor or an institutional investor (as defined in the Securities Futures Act), GAIN Capital Singapore Pte. Ltd. accepts legal responsibility to such persons for the contents of the report only to the extent required by law. Singapore recipients should contact GAIN Capital Singapore Pte. Ltd. at 6826 9988 for matters arising from, or in connection with the report.

In the case of all other recipients of this report, to the extent permitted by applicable laws and regulations neither GAIN Capital Singapore Pte. Ltd. nor its associated companies will be responsible or liable for any loss or damage incurred arising out of, or in connection with, any use of the information contained in this report and all such liability is hereby expressly disclaimed. No representation or warranty is made, express or implied, that the content of this report is complete or accurate.

GAIN Capital Singapore Pte. Ltd. is not under any obligation to update this report.

Trading CFDs and FX on margin carries a high level of risk that may not be suitable for some investors. Consider your investment objectives, level of experience, financial resources, risk appetite and other relevant circumstances carefully. The possibility exists that you could lose some or all of your investments, including your initial deposits. If in doubt, please seek independent expert advice. Visit for the complete Risk Disclosure Statement.

Important Notice:

Cryptocurrencies are not legal tender currency and trading of derivatives on Cryptocurrencies are currently not covered under any regulatory regime in Singapore. Consequently, investors should be aware they do not have protection under the Securities and Futures Act (Cap. 289). Please ensure that you are fully aware of the risks.