FTSE could hit 7,000 points in early 2014 – ETX

By
Daily Excelsior
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LONDON, Nov 15: Britain’s top share index edged up on Friday, supported by pledges of continued U.S. monetary stimulus and a rise in Africa-focused oil group Tullow Oil
U.S. And Asian stocks rose for a second day after the Federal Reserve’s chairman-designate Janet Yellen defended the bank’s quantitative easing programme on Thursday, dispelling concerns about an early reduction of the asset  purchases.
The quantitative easing programme helped the FTSE 100 rise nearly 20 percent in the past year by driving investors out of safe bonds into higher yielding assets, such as stocks.
The FTSE was up 19.91 points, or 0.3 percent, at 6,686.04 points at 0911 GMT, building on a 36 points rise on the previous day when Yellen started her testimony before the U.S. Senate Banking Committee.
The FTSE 100 has been pulling back since hitting a five-month high at 6,819 points on Oct. 30, hit by concerns over an early end to QE and lacklustre corporate  results.
‘If the U.S. Keeps pushing forward I think eventually we’ll jump on their coat tails,’ Mark Priest, a senior trader at ETX Capital said, adding the FTSE could hit 7,000 points early next year.
‘The only thing that would stop us is early talk of early tapering which seems to be more and more distant.’
Shares in Tullow, up 1.4 percent, were the top risers on the FTSE after the firm said it had restarted operations in northern Kenya after reaching a deal with local leaders to prevent a repeat of protests that halted work last month.
Utility group Centrica pinned back the FTSE, falling for a second day as a string of analysts cut their target prices for the stock after a profit warning on Thursday.
‘On one hand, profits are being eroded by competitive pressures in energy retail and power generation; on the other the politic rhetoric in the media is hostile due to perceived profiteering,’ JP Morgan said in a note.
‘Until the public and political climate becomes more constructive, we see limited share price upside for either Centrica or (peer) SSE.’
Shares in SSE were little changed.
In a tactical note, Morgan Stanley estimated that there was 70 percent to 80 percent probability that Centrica would fall relative to the industry over the next 15 days. (AGENCIES)
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