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MARKET WRAP: FTSE finishes flat, USD soft, Bitcoin steady

© Reuters.

Key Points

FTSE 100 closing price of 7463.95 (-0.03%)
Vodafone higher as an activist investor takes stake
UK PM addresses parliament after the report on lockdown parties released
GBP steady, USD weaker
Oil higher as focus on Ukraine, OPEC+
Bitcoin holds near $37K after quiet weekend

By Samuel Indyk – The FTSE 100 finished little changed on Monday as focus turns to key central bank meetings this week, including the Bank of England and European Central Bank decisions on Thursday.

Vodafone (LON:VOD) shares were higher after reports activist investor Cevian Capital had taken a stake in the telecommunications company. The Financial Times report said that Cevian is pushing for an overhaul to enhance its strategy in key markets and refresh its board.

“Activist investors are becoming increasingly vocal within FTSE 100 companies, perhaps spurred on by one another, particularly on issues like ESG and executive pay,” writes interactive investor Head of Investment Victoria Scholar. “Unless drastic action is taken to overhaul Vodafone, the stock looks set to continue to underperform the FTSE 100, at a time when the UK market is looking increasingly compelling from a valuation perspective, having underperformed other global indices since Brexit.”

The long-awaited partygate report from civil servant Sue Gray into the goings-on at 10 Downing Street during lockdowns was finally released. The report found that the behaviour surrounding these “gatherings” was difficult to justify.

Gray said 16 different events fell within her remit, of which 12 are now being investigated by the Metropolitan Police. Prime Minister Boris Johnson apologised in parliament and said changes will be made to how No. 10 and the Cabinet Office are run.

GBP was unperturbed by the initial release of the report with Johnson still hanging on by a thread to his job as Prime Minister. GBP/USD held above 1.34, although EUR/GBP rose back above 0.8350.

WTI and Brent crude futures were both marginally higher with the latter knocking on the door of $90/barrel. The ongoing situation on the Ukrainian border with Russia continues to support prices although there were no material developments on Monday. The UN Security Council is set to meet today to discuss Russia’s build up of troops on the border.

Meanwhile, OPEC+ meets this week to discuss production plans for March. The cartel is expected to stick with its plan to lift output by 400,000 barrels per day in March despite some countries struggling to hit their production quotas.

Bitcoin was little changed despite a jump in US stocks in early trade. The largest cryptocurrency by market cap traded in a relatively tight range over the weekend and has shown signs of stability after dropping below $33,000 last Monday.


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MARKET WRAP: FTSE finishes flat, USD soft, Bitcoin steady

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