Investors continue to put faith in the FTSE

19 October 2009
Last week saw the FTSE 100 strike a 12-month high, bolstered by a strong performance from mining and banking shares, while energy firms performed well as oil prices continued their recent ascent to stand near to 78 US dollars a barrel. Investors have continually capitalised on the market highs of recent weeks, with clients of Barclays Stockbrokers, the UK's largest stockbroker, reaching buy:sell ratios of 55% vs. 45% respectively on Monday and Tuesday.

On Wednesday buys dropped to 50%, as investors profited from the market peak of a one year high by increasing their sells, the sectors dominating the sell off were financials and mining/oil and gas stocks. Thursday saw the buy:sell ratio shoot back up to 56% in favour of buys, as investor confidence was further boosted by strong financial company results.

Barbara-Ann King, Head of Investments at Barclays Stockbrokers said: "Recent unemployment data has been poor and economic releases generally have been mixed, but equity markets have held on to their gains of recent months. However equity markets are a barometer, not a thermometer - they are forward-looking rather than an indication of current conditions - and this may help to explain the apparent anomaly of a strong equity market against the backdrop of a poor economic picture. Last week saw the FTSE reach a 12 month high as mining, banking and energy companies reported strong results which could be a strong indicator of the much talked-about green shoots of recovery.

"It is encouraging to see our clients continuing to trade cleverly, capitalising on the market rally of recent weeks, with positive buy:sell ratios and investors reacting to the strong market conditions. We expect to see this continue as the markets continue gaining strength."