Week in Review: FTSE 100 climbs higher as investors shrug off warnings over UK economy

FTSE NEWS

The FTSE 100 finished Thursday (9 April) strongly despite warnings that the UK economy could shrink by up to 25% in the second quarter of the year if the coronavirus lockdown persists. London’s index of blue-chip shares climbed 2.81% to 5,837.09.

• Monday (13 April) is Easter Monday and therefore financial markets are closed.
• On Tuesday (14 April), the German government is set to review the lockdown measures put in place to combat the coronavirus, with the outcome likely to move markets. Elsewhere on Tuesday, data firm Markit, which owns the Halifax House Price Index, is due to publish a regional breakdown for house prices for the first three months of the year.
• On Wednesday (15 April), HM Treasury will release a comparison of the various different forecasts for the UK economy from independent think-tanks and macroeconomic consultancies.
• On Thursday (16 April), the European Parliament will hold an extraordinary plenary session where it will debate a coordinated strategy to combat the Coronavirus. Meanwhile, the Bank of England is due to publish it latest Credit Conditions Survey, which highlights trends and changes in the cost and availability of credit in the UK.
• Investors will be keeping a keen eye on the latest quarterly Chinese GDP data to be published by the National Bureau of Statistics of China on Friday (17 April). The data is expected to show what effect COVID-10 has had on the Chinese economy during the first three months of the year.

SECTOR IN FOCUS

Investors were eagerly awaiting the outcome of a special Organization of the Petroleum Exporting Countries (OPEC) after markets closed on Thursday (9 April). Attendees met to discuss a deal between Saudi Arabia and Russia to cut production, with further talks due to be held on Friday (10 April). Analysts says that the price of oil could surge if a cut is agreed, which would probably push up the share of British oil giants BP plc (BP.) and Royal Dutch Shell plc (RDSA).  However, the price of oil could sink to fresh lows if a deal can’t be reached.

ECONOMIC UPDATE

We have seen in recent week that the coronavirus is having a damaging effect on the UK economy. But how are individual regions faring? On Wednesday (18 April), Natwest’s UK Regional PMI survey should tell us the pandemic is affecting business output in nine English regions, Northern Ireland, Scotland and Wales are coping with the pandemic. From this, we should be able to determine the areas of the UK most effected by the crisis.

FUND WATCH

With strong corporate governance, political stability and a host of global world-class companies available at relatively low valuations, Japan has long been a favourite with UK investors looking to diversify their portfolios. The five-star Morningstar rated JPM Japan Fund C – Net Accumulation (GB00B235RG08) gives you exposure to these companies for an ongoing charge of 0.82%.

COMPANY ANNOUNCEMENTS

15 April – Analysts have been fairly bullish about JD Sports Fashion plc’s (JD) prospects, with many believing the firm will emerge from the coronavirus crisis relatively unscathed due to its robust balance sheet and healthy trading figures. Investors will want to see further evidence of this when the sports retailer posts its full-year results on Wednesday (15 April).

16 April - Keyword Studios plc (KWS), a provider of technical services to the video games industry, is set to issue its full-year results on Thursday (16 April). The firm claimed at the end of last month that it had so far seen minimal disruption to business from COVID-19.