FTSE 100 lower as Johnson sets out Covid plan, pound strengthens, bitcoin tumbles

By Samuel Indyk

• FTSE 100 ends lower by 0.1%
• GBP/USD moves to multiyear highs
• Bitcoin volatile, falls 13% before bouncing

Investing.com – The FTSE 100 ended the day lower but off of worst levels as the UK Prime Minister Boris Johnson announced the roadmap for ending Covid restrictions. It was a difficult start to the week for the blue-chip index but many of the “reopening” names performed well following Johnson’s announcement.

Hotel names InterContinental Hotels Group PLC (LON:IHG) and Whitbread PLC (LON:WTB) (the owner of the Premier Inn chain) were two of the best performing stocks in the index as April 12^th was set as a potential date for reopening hospitality in the UK.

Companies that have benefitted from lockdown measures such as Ocado Group PLC (LON:OCDO) and Just Eat Takeaway (LON:JETJ) underperformed as a reopening of the economy could put a halt to the growth seen over the last 12 months.

FTSE 350 Oil & Gas names and mining companies were again strong as commodities maintain their rally. Copper Futures in London broke $9,000 a ton for the first time since 2011, hitting a high of $9,271.50 before paring some of the gains. Crude Oil WTI Futures prices resumed their rally as the Texas energy sector starts to come back online following the freeze last week.

Earlier, Goldman Sachs (NYSE:GS) raised their Brent Oil Futures price forecasts by $10/barrel to $70/barrel next quarter and $75/barrel in the next three months.

Bitcoin tumbled early on Monday, falling as much as 13% before bouncing somewhat. Currently the price is down around 8%. On Sunday, the world’s largest cryptocurrency hit a high above $58,000, taking year-to-date gains to almost 100%. However, some of the exuberance eased on Monday and the crypto-wide decline saw almost $300bln wiped off the total market cap of all cryptocurrencies.

GBP/USD held firm above 1.4000 and in fact hit a new multi-year high at 1.4069 ahead of Boris Johnson’s announcement. The confidence of the UK PM will have given bulls hope that the rally can hold but the government’s top science adviser Patrick Vallance warned that the UK would not be “off to the races” despite the impressive vaccine effort.

"The message that comes out of all of the modelling is... get (infection) numbers down before you start releasing, go slowly, (and) go in blocks that you can measure the effect of after four or five weeks," Vallance said.

As a reminder, the UK Prime Minister Johnson is expected to hold a press conference at 19:00GMT.

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