The FTSE 100 clawed back early losses on Tuesday as investors shook off more concerns about China and realigned portfolios after a busy period for central banks.
Apart from the FTSE 100’s miners, there were no clear sector gainers or losers on Tuesday suggesting investors had their stock picking hats on as the furore around interest rate decisions died down.
There was a stark contrast in the performance of individual stocks within certain sectors on Tuesday as investors picked out their sector favourites.
For example, Barclays was the FTSE 100’s top riser, gaining 3%, while Lloyds and Natwest fell marginally on the day.
Sainsbury’s was the top faller with losses of 3.5% as Tesco managed to remain positive. Housebuilder Berkeley Group Holdings were out of favour with 2% drop while Taylor Wimpey and Barratt Developments recorded small gains.
A broker upgrade helped lift Kingfisher 1.2%. Investec analysts turned bullish on Kingfisher upgrading the stocks to ‘buy’ from ‘hold’ with a price target of 255p.
While there were some positive individual moves and the index crept higher, lurking in the background were underlying concerns about what was happening in China’s property market and the US credit rating.
“Investors remain understandably wary about China’s troubled property sector and while Wall Street regained some poise overnight, the threat of a government shutdown is creating nervousness across the Atlantic too,” said AJ Bell investment director Russ Mould.
“Moody’s has warned about a possible downgrade for the credit rating of the world’s largest economy, yet another thing for the markets to fret about. And the message of higher rates for longer doesn’t seem to be going away.”