We had been nervous for a few weeks over the possibility of a profit taking snap emerging. So the recent minor sell-off has come as no major surprise.

We can see how price action has “only” dropped down to the lower end of the existing bullish trend channels. So little technical damage has been done on this move, so far.

In order to turn more nervous we would need to see price further into the older bullish trading range, blue region, currently under 5450. Buyers have already been tempted in, on the recent selling, on the hopes that the “buy on dips” strategy that has proved so profitable for so many months now will be good for at least one more leg higher.

However there are some very early signs that this buying may be more retail based buying, and less institutional, raising concerns around the Hindenburg Omen we highlighted a few weeks ago.

So for the week ahead this follow through buying may come through with enough scale on the key names that it could lift the wider market back above 5,600. But concerns remain for Q3 ahead and into Q4 as the record breaking run of the inverted US yielded curve continues and we have so much geopolitical uncertainty around the US election and possible international flash points in Ukraine/Russia, Israel/Gaza/Lebanon, China/Taiwan but that until/unless we see price action consolidate under the 5,400 area we remain in a strong bullish trend.

Rising capital gains tax receipts and a public spending mismatch are fueling speculation about the new Labour government’s potential changes to CGT rates.

Some experts suggest that Chancellor Rachel Reeves may consider equalising CGT rates with income tax rates to address the total public finance gap of around £20 billion per year.

As well as shelving major spending projects, speculation is mounting that Reeves will boost the coffers through a raid on capital gains.

Recent data reveals that capital gains tax (CGT) receipts in the UK reached a record high of £16.929 billion in the 2022/2023 tax year. The number of individuals paying CGT has also seen a significant rise, increasing by 50% to 394,000 over the five years leading up to 2021/2022.

The annual tax-free allowance for CGT was substantially reduced from £12,300 in the 2022/23 tax year to £3,000 in the current tax year. This reduction is likely to bring more individuals into the CGT net, potentially leading to even higher receipts in the coming years.

Despite CGT already set to impact more individuals, the government is thought to be planning additional changes to the tax which could result in more people paying more tax.

The government will release more detailed information on Thursday, including breakdowns of the types of gains contributing to this record CGT haul.

“Capital Gains Tax speculation has intensified. As Rachel Reeves peers into the hole in the public finances and is set to reveal just how deep it goes, rumours are swirling as to whether CGT changes could be used to generate extra cash to help fill it,” said Sarah Coles, head of personal finance, Hargreaves Lansdown.

“One of the suggestions doing the rounds is that capital gains tax rates could rise to match income tax. It was one of the things the Office for Tax Simplification explored in 2020. This would see a shocking hike for UK investors. 

“As the OTS highlighted in 2020, in the long term it runs the risk of people hoarding their profits until they die. This would mean, for example, buy-to-let investors refusing to part with properties they don’t really want in an effort to avoid CGT, while first time buyers struggle to get on to the property ladder. 

“The tax system should be encouraging and rewarding long-term investing. This has been absent from the CGT system since taper relief was abolished in April 2008. Right now, investors face the double-whammy of a system that taxes investments that are simply keeping pace with inflation and allows for far lower gains to be realised tax-free each year. If the rates do end up rising, it would add insult to injury. We’d urge the Chancellor to reintroduce incentives that reward long-term investing.”

Helium One Global has issued a progress update on its Tanzanian operations announcing its commenced drilling operations at the Itumbula West-1 well late last week.

Helium One said it plans to conduct an extended well test on two intervals at the project: the fractured basement and faulted Karoo. This follows a successful drill stem test in February 2024 that yielded 4.7% helium flow to the surface.

Investors will be pleased that Geolog – the firm contracted to perform mudlogging and testing during drilling to monitor helium gas shows – has already noted back ground indications of helium and hydrogen. A portable mass spectrometer and field pressure-volume-temperature specialist are on site to measure and validate helium gas shows and downhole samples from the extended well test.

The company said it anticipates that this phase of operations, from spud to completion of the extended well test, will take approximately five weeks. The Itumbula West-1 well previously demonstrated success in February 2024, with a drill stem test flowing 4.7% helium and 2.2% hydrogen to the surface from the fractured Basement.

The FTSE 100 gained on Friday as bargain hunters stepped into beaten-down names after a week of heightened volatility, which was largely caused by a selloff in US technology shares.

London’s leading index was 0.9% higher at the time of writing and was actually set to close the week out higher.

The resilience of the FTSE 100 was apparent this week, as losses in UK stocks driven by concerns about a US technology selloff were mostly contained and were quickly bought into by traders seeking shelter in pharmaceutical names and commodities.

Earnings season is well underway, and the results kept coming on Friday with NatWest, SEGRO and Rightmove among the FTSE 100 companies reporting. Generally strong earnings from FTSE 100 firms this week helped the index outperform as US indices were hit by a rotation out of tech and mainland Europe was ravaged by a luxury rout.

NatWest was the FTSE 100’s best-performing stock of the session after the bank beat estimates and increased its dividend. NatWest’s report was very similar to Lloyd’s report yesterday in that half-year profits declined, and Q2 profits were much lower than last year. However, NatWest’s Q2 results showed a mild improvement on Q1, which sparked a 6% rally in the stock.

“NatWest’s long, long recovery from the financial crisis looks as meaningful as it has done at any point in the last 16 years or so with the company’s latest results including plenty to like from the point of view of shareholders,” said AJ Bell head of financial analysis Danni Hewson.

“Unlike Lloyds, whose own better than expected numbers received a muted response from the market, NatWest is not only benefitting from lower impairments but also higher than anticipated income and the company not only beat on the second quarter but it is lifting guidance for the full year too.

“Notably the company is feeling confident to go on the offensive – boosting its position in the UK mortgage market with the acquisition of a chunky portfolio from Metro Bank. This follows on from the recent purchase of Sainsbury’s Bank.”

Rightmove carved out a 0.4% gain after profits crept higher in the first half, but using underlying activity on the platform remained broadly flat.

SEGRO was firmly at the bottom of the leaderboard after the REIT said its NAV declined by 1.8%. SEGRO shares were down 2.2% at the time of writing.