FTSE 100 holds above 7,000, DXY reclaims 90.00, Bitcoin falls on China crackdown By Investing.com

Key Points

• FTSE 100 closing price of 7,016.5, -0.05%
• Card Factory falls after trading update
• UK retail sales surge, PMI hits record high
• Bitcoin falls as China crackdown intensifies

By Samuel Indyk

Investing.com – The FTSE 100 finished relatively flat but closed above 7,000 in a relatively quiet day for UK shares.

Shares in Card Factory (LON:CARDC) underperformed after the greetings card retailer announced that store sales were lower on a like-for-like basis in the five weeks since non-essential retail could reopen.

The disappointing figures from a retail name were at odds with official figures from the Office for National Statistics. Retail sales increased 9.2% MoM in April in the first month of stores reopening. The ONS said that a rise in clothing sales was one of the main drivers but the share of online retail spending dropped to 30% from 34.7% in March.

That was not the only strong UK data released on Friday. IHS Markit’s composite PMI hit its highest level since inception in May, rising to 62.0 from 60.7.

“The UK is enjoying an unprecedented growth spurt as the economy reopens,” said IHS Markit Chief Business Economist Chris Williamson. “The strongest upturns in demand were reported for hotels, restaurants and other consumer-facing services, though improvements were reported across the board in all sectors.”

Despite the strong data, GBP was relatively subdued, suggesting that the UK economic rebound is somewhat priced into the currency. GBP/USD traded below 1.42 as the US Dollar Index moved back above 90.00. EUR/USD retreated back below 1.22.

In the world of digital currencies, Bitcoin shed gains after the Chinese Vice-Premier Liu He called for a crackdown on mining and trading activities at the State Council Financial Stability and Development Committee.

Bitcoin fell back below $40,000 to at a low of around $36,675, still above the trough nearer $30,000 hit on Wednesday. Other major cryptocurrencies tumbled too. Ethereum dropped back toward $2,500 and Dogecoin dropped towards $0.34.

In regards to more traditional stores of value, Gold looked set to record a third consecutive week of gains and hit its highest level in four months.

WTI and Brent crude futures gained despite fears that an Iranian nuclear deal could unlock a flood of Iranian crude just as demand begins to pick up from the pandemic. Despite fears that the pandemic is going to dampen demand in Asia, European and US demand should pick up in the second half of the year as countries reopen their borders and travel resumes.

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