Skip to Content
News & Analysis at your fingertips.

We use a range of cookies to give you the best possible browsing experience. By continuing to use this website, you agree to our use of cookies.
You can learn more about our cookie policy here, or by following the link at the bottom of any page on our site. See our updated Privacy Policy here.



Notifications below are based on filters which can be adjusted via Economic and Webinar Calendar pages.

Live Webinar

Live Webinar Events


Economic Calendar

Economic Calendar Events

Free Trading Guides
Please try again
More View More
Breaking news

NFP prints at 339k vs estimates of 190k, ave earnings in line at 0.3% MoM

FTSE 100 Tumbles Below 7,000 on Virus Concerns and Tobacco Review

FTSE 100 Tumbles Below 7,000 on Virus Concerns and Tobacco Review

Daniela Sabin Hathorn,
What's on this page

Key Talking Points:

  • Tobacco shares drop as Biden studies new regulation regarding nicotine usage in the US
  • FTSE 100 hangs on to the longer-term bullish trend as key support halts losses
Equities Forecast
Equities Forecast
Recommended by Daniela Sabin Hathorn
Get Your Free Equities Forecast
Get My Guide

The FTSE 100 fell sharply on Tuesday, dropping below the 7,000 only two days after managing to push above it for the first time in 14 months. The UK index was hard hit by a sharp fall in tobacco shares as news broke out that Biden is looking at introducing new regulations in the US regarding the level of nicotine in cigarettes. Imperial Brands PLC and British American Tobacco were down around 7%.

But the biggest loser in yesterday’s session was IAG, which dropped over 8% as airlines were bringing the FTSE 100 down further. The recent spread of an Indian variant of Covid-19 has investors worrying again about the prospects of international travel this summer, which jeopardizes the plans of European airlines like Easyjet, Ryanair, and Iberia to resume more normal activity in the next few months.


FTSE 100 Levels

It’s definitely premature to call yesterday’s pullback a change in trend. For now, it seems more like a short-term correction in the longer-term ascending trend, which would allow new buyers to come in at lower levels to bring the index higher again. Selling pressure was halted around the 6,846 level, which has been of increased significance in the last few weeks, so it will be a good area to monitor to see if further pullbacks are likely to be achieved.

If so, the ascending trendline from the January 31st lows will be the next reference support in the short-term, which is converging nicely with the 6,800 mark, a round level that could see some sideways pressure as it is likely to be an area with increased stop-losses and take-profits.

As long as the FTSE 100 stays above the ascending trendline then the longer-term bullish trend will be in play, so I would expect the index to drift higher towards the 7,000 mark again, although we may see some consolidation as increased resistance is found at the 76.4% Fibonacci (6,894). A break above 7,045 would likely see bullish pressure increase towards the 7,200 area.

FTSE 100 Daily chart

The Quiz
Discover what kind of forex trader you are
Start Quiz

Learn more about the stock market basics here or download our free trading guides.

--- Written by Daniela Sabin Hathorn, Market Analyst

Follow Daniela on Twitter @HathornSabin

DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.