Traders are ramping up bets on the Bank of England cutting interest rates this summer amid optimism that the US Federal Reserve is poised to begin reducing borrowing costs in America. Money markets indicate there is more than a 50pc chance that policymakers will cut rates in Britain next week - with a 92pc chance of them doing so by September. Traders began ramping up bets on a summer rate cut today, up from a 45pc chance on Wednesday, as money markets indicated a rate cut in the US was becoming more likely.
Data today showed an unexpected slowdown in consumer spending on durable goods like cars and washing machines, dropping by 6.6pc despite predictions it would rise by 0.3pc.
The figures cemented bets on the Federal Reserve cutting interest rates in September, which is now fully priced in. Money markets showed confidence in rate cuts despite official figures showing the American economy expanded faster than expected in the second quarter of the year. US GDP grew by 2.
8pc in the three months to June, according to the Commerce Department, which was much faster than the 2pc that had been predicted by analysts. Stephen Brown, deputy chief North America economist at Capital Economics, said: “The sharper-than-expected pick-up in second-quarter GDP growth to 2.8pc annualised should make the Fed a bit more comfortable about keeping policy unchanged next week, but the recent loosening of labour market conditions and signs of slower price growth still mean that there is a strong case for a cut at the following meeting in September.
” 06:09 PM BST Signing off...
Thanks for joining us today. will be back in the morning before London’s markets open, but I’ll leave you with our report that . 05:55 PM BST Miliband picks leading Brexit critic as GB Energy chairman Ed Miliband has appointed a former Siemens executive and leading critic of Brexit to run the new state-owned power business Great British Energy.
reports: Jürgen Maier, a British-Austrian businessman who previously headed up wind turbine producer Siemens UK, has been chosen by the Energy Secretary to chair the company and accelerate Britain’s renewable electricity programme. Mr Maier warned before Britain’s departure from the European Union that quitting would hit the country’s economy like a “slow puncture”, making it far harder for British companies to export their products. He used the phrase in a Guardian interview in 2020, following it up with a post on his personal website which argued that closer ties with the EU would be vital in the coming years – and suggesting the country could even go back into the single market.
At the time, Mr Maier wrote that repairing the alleged economic damage “will only be possible by creating more alignment and not less, as some key Brexit promoters are arguing for post Brexit”. 05:53 PM BST Car giant Stellantis could axe brands Stellantis, the owner of 14 car brands including Vauxhall, Maserati and Fiat, could axe one or more of its brands if they fail to deliver a profit, chief executive Carlos Tavares has said. The warning for lossmaking brands is a turnaround for Mr Tavares, who has maintained since Stellantis was created in 2021 that all of its 14 brands have a future.
“If they don’t make money, we’ll shut them down,” Carlos Tavares told reporters after the world’s fourth-largest carmaker delivered worse-than-expected first-half results, sending its shares down as much as 10pc. “We cannot afford to have brands that do not make money.” In an interview with Bloomberg TV, he said that “there’s absolutely no taboo” if their performance deteriorated.
“If they are not able to monetise the value that they represent, then decisions will come.” 05:37 PM BST Luxury group Hermes outshines rivals with strong profits French luxury group Hermes has reported strong sales and profit for the first half of the year, outshining rivals hit by a slowdown in the key Chinese market. Sales reached €7.
5bn (£6.3bn) in the first six months of 2024, up 12 percent from the period last year. Net profit rose 6.
4pc to €2.4bn. Axel Dumas, executive chairman, said: The solid first-half results, in a more complex economic and geopolitical context, reflect the strength of Hermes’ model.
Louis Vuitton and Dior owner LVMH, the world’s biggest luxury group, said earlier this week that its net profit slid 14pc to €7.3bn in the first half. Another major French group, Gucci owner Kering, said on Wednesday that its half-year net profit fell by half and warned that operating earnings for the second half of the year would be down around 30 percent.
British brand Burberry and Cartier owner Richemont both reported last week sharp drops in sales in China. 05:30 PM BST German railways to slash 30,000 jobs German rail operator Deutsche Bahn plans to cut 30,000 jobs, or around 9pc of its staff, it said today, after huge investments to repair its rail network, strikes and bad weather led to a billion-euro first-half loss. The cuts are to be made over the next five years and mostly affect administrative jobs, finance chief Levin Holle said, adding this year around 1,500 jobs would have to go.
“We must achieve more railway with fewer people in future,” he said. After more than a decade of underinvestment, Deutsche Bahn has started massive repair works on its tracks, crossings and overhead lines that will take years and which are already causing hefty train delays and cancellations. The German government’s introduction of a so-called Germany ticket last year that allows travel on all regional and local trains for €49 a month led to a huge spike in passengers and added to the problems.
Bad weather worsened the already-stretched situation for passenger and freight transport in the January-June period. Workers’ strikes that snarled rail traffic for several days at a time cost the firm around €300m, it said. Deutsche Bahn said it invested €4bn in its rail networks and services in the first half, a 35pc increase over last year.
It employed 324,000 staff in 2022. 05:19 PM BST Shares in Vauxhall-owner Stellantis plunge Shares in car giant Stellantis, whose brands include Vauxhall, Jeep and Fiat, plunged on Thursday after it published disappointing earnings while French rival Renault also tumbled despite record profitability. Stellantis fell 8.
7 percent, the second worst performer on the Paris Cac 40 index, with Renault in third place as it fell 7.5pc. Stellantis, a 14-brand group that also includes Alfa Romeo, Chrysler, Dodge and Maserati, reported Thursday a 48-percent drop in net profit to €5.
6bn (£4.7bn) for the first half of the year. Sales fell 14pc to €85bn.
Carlos Tavares, chief executive, said: The Company’s performance in the first half of 2024 fell short of our expectations, reflecting both a challenging industry context as well as our own operational issues. Stellantis, however, maintained its forecast of a double-digit operating margin this year. 05:11 PM BST World stocks are mixed after selloff World stock indexes were mixed on Thursday, with the S&P 500 higher after the yesterday’s selloff.
The Dow Jones Industrial Average is up 1pc, the Nasdaq is up 0.3pc and the S&P 500 is up 0.6pc.
Meanwhile, the pan-European Stoxx Europe 600 is down 0.7pc, France’s Cac 40 is down 1.2pc and Germany’s Dax is down 0.
5pc. The MSCI gauge of stocks across the globe is flat. 05:05 PM BST Nasdaq boss predicts increasing numbers of flotations Lower interest rates could fuel initial public offerings next year, the head of the Nasdaq stock exchange has said.
Adena Friedman told Bloomberg TV: We’re seeing good progress and we think that going into 2025 we should see more momentum in terms of the pipeline of companies we have been talking to. Ms Friedman reportedly said that IPO market has been muted because of higher cost of capital, which impacts future earnings projections. If costs come down, “that could be a catalyst for more IPOs going forward,” she said, in comments reported by Bloomberg.
04:58 PM BST Royal Mail faces assault from US fund with £2.7bn takeover of rival Evri Royal Mail is facing an assault from one of the world’s biggest buyout funds as Apollo announced a £2.7bn deal to buy the British parcel company Evri.
reports: The US investment firm said it will inject fresh funding to grow Evri’s parcel business after outbidding rival suitors in an auction for the delivery group. Alex van Hoek, a partner at Apollo, said the hedge fund would “support and invest in Evri’s continued success and expansion” as its new owner. He added: “We are excited to leverage our capital and experience in logistics and transportation to serve as value-add partners in this next phase.
” The Apollo backing is expected to hand Evri fresh firepower to take on Royal Mail. 04:53 PM BST FTSE 100 closes up The FTSE 100 closed up 0.4pc this afternoon.
Unilever was the biggest riser, up 6.2pc, followed by British American Tobacco, up 5.3pc.
The biggest faller was British Gas owner Centrica, down 9.9pc, followed by Airtel Africa, down 7pc. Meanwhile, the FTSE 250 fell 0.
3pc. City firm IG Group rose 6.7pc, while Ocado rose 3.
5pc. The biggest faller was Hochschild Mining, down 8.1pc, followed by gold miner Centamin, down 7.
7pc. 04:41 PM BST EU to fine Facebook owner over alleged breach of competition rules Social media giant Meta is reportedly facing its first fine under EU competition rules for tying its Marketplace classified advertising service to its Facebook social network. The move by the European Commission, first reported by Reuters, comes more than a year and a half after it accused the US tech giant of giving its classified ads service an unfair advantage by bundling it with its main social network.
Meta could face a fine of as much as $13.4bn (£10.4bn), or 10pc of its 2023 global revenue.
However, EU sanctions are usually much lower than that cap. A Meta spokesman told Reuters: “The claims made by the European Commission are without foundation. We continue to work constructively with regulatory authorities to demonstrate that our product innovation is pro-consumer and pro-competitive”.
The Telegraph has approached Meta for further comment. 04:20 PM BST Russia claims no friction with Opec+ despite overproducing oil Vladimir Putin’s oil point man said on Thursday that there was no friction with oil cartel Opec+ after Russia exceeded crude production quotas. Russia yesterday unexpectedly announced that its crude oil production in June exceeded quotas set by the Opec+ cartel but said that it would resolve the issue and stick to agreed output levels this month.
The news triggered speculation among some oil traders about tension between Saudi Arabia, the world’s biggest exporter which leads the Organization of the Petroleum Exporting Countries, and Russia. Together Opec and others including Russia, in a group known as Opec+, have made a series of deep output cuts since late 2022. Asked by reporters in Moscow if Arab members of the Opec+ club were unhappy with Russia’s overproduction, Russian deputy prime minister Alexander Novak said: “We have no friction.
” “What we are under-fulfilling is very meagre,” he added. “These are errors that will actually be eliminated, secured and obligations will be fulfilled.” An industry source told Reuters that Mr Novak held a call last week with Saudi officials, who expressed concern about Russia’s overproduction.
“I spoke with the minister [of Saudi Arabia] last week,” Novak said. He gave no further details. 04:13 PM BST Apple’s China iPhone shipments drop as Huawei surges, data shows Apple’s smartphone shipments in China fell by 6.
7pc in the second quarter of 2024, as the tech giant faced intensifying competition from rivals like Huawei, according to data from market research firm Canalys. Apple’s total shipments for the quarter ending in June stood at 9.7m units, down from 10.
4m in the same quarter last year, Canalys data shows. In contrast, Huawei’s smartphone shipments surged 41pc year-on-year to 10.6m in the quarter, bolstered by the launch of its new Pura 70 series in April.
Huawei made a comeback to the high-end smartphone segment last August with the release of a device powered by a domestically-made chip, defying US sanctions that have cut off its access to the global chipset supply chain. 04:00 PM BST US small caps up 1pc as investors look towards rate cuts The Russell 2000 index of smaller US stocks has climbed 1pc in trading this afternoon, doing better than the three main US market indexes. It’s up more than 8pc this month, versus a 1pc dip for the big stocks in the S&P 500.
Because inflation has largely resumed its slowdown following a rough start to the year, traders are largely expecting the US Federal Reserve to begin cutting its main interest rate in September. Such cuts would release pressure that’s built up on both the economy and financial markets, and investors are thinking it could offer a particularly big boost to smaller stocks and other areas of the market that have been left behind by Big Tech in recent years. Chris Beauchamp, chief market analyst at online trading platform IG, said: Most indices are still lower this afternoon, though another 1pc rise for the Russell 2000 on Wall Street shows that last week’s rotation is still going on beneath the surface.
All eyes are on the Magnificent 7 and USD/JPY [dollar to Japanese yen exchange rate], both viewed as the main culprits of the recent selloff. While buying the dip in these two markets has paid off handsomely so far this year, with a Fed meeting and tech earnings on next week’s calendar, the risk of renewed volatility is very high. 03:54 PM BST Saudi airline Flynas to buy 90 Airbus planes European aviation giant Airbus announced Thursday that it has signed a deal with Saudi low-cost carrier Flynas for 75 single-aisle A320neo jets and 15 long-haul A330-900 planes.
The planes have a catalogue price totalling $13bn (£10bn), though big orders usually have significant discounts. The two sides signed a in principle agreement at the Farnborough International Airshow, an event that also landed large orders for Airbus’s US rival Boeing this week. Flynas, which was founded in 2007, only uses Airbus planes.
Its fleet includes 52 A320 planes and four A330 jets that it rents. The company has already ordered 65 A320 and A321 planes. The A330 ordered by Flynas will be modified to fit 400 passengers, Airbus said, instead of up to 300 under the current configuration.
03:49 PM BST US hopes to dissuade China from pursuing ‘regrettable’ WTO dispute, amabassador says The US ambassador to the World Trade Organisation has she hopes China could be persuaded to drop a dispute initiated by Beijing in order to protect its interests in the electric vehicle industry. “We find it regrettable that China is taking this step, we hope that we can dissuade them from moving forward in the future,” Maria Pagan told reporters on Thursday. The dispute which concerns electric vehicle subsidies under the US Inflation Reduction Act is due to be formally raised at a WTO meeting on Friday.
03:46 PM BST Hasbro shares jump amid tight control of costs Hasbro shares are up 3.8pc after it posted a smaller-than-expected drop in second-quarter sales and beat profit expectations. The results were helped by cost-control measures and steady demand for digital gaming, sending shares of the toymaker upwards.
The Nerf toy gun maker’s turnaround strategy to limit expenses and maintain a tight inventory amid an industrywide slowdown in toy demand has helped its margins grow in the quarter to 21.3pc, compared with a 15.6pc decline a year earlier.
James Zahn, of trade magazine The Toy Book, said: Hasbro has made great strides in reducing its inventory...
which will lead to cost savings in various ways, including lower production costs, shipping, and storage, and reduced markdowns and close outs.” Steady growth in its mobile and video games, including Monopoly Go! and Baldur’s Gate 3, led to a 20pc jump in quarterly revenue from the company’s Wizards of the Coast unit. Total quarterly revenue fell 18pc to $995.
3m (£772.5m) in the reported quarter, compared with a 22.02pc fall estimated by analysts, according to LSEG data.
03:40 PM BST NHS spending rules risk depriving Britain of new medicine, warns AstraZeneca boss NHS spending rules risk depriving Britain of new medicines, the boss of AstraZeneca has warned, amid a row over a decision to block its life-extending breast cancer drug. reports: Sir Pascal Soriot warned that access to medicine in England would “totally shrink” without a review of how the NHS spending watchdog assesses new drugs and decides if they are value for money. He said: “The methodology needs to be adjusted and patients need to get access to the medicines that can really change their life.
” It comes amid a backlash over a decision by the NHS spending watchdog, the National Institute for Care and Health Excellence (Nice), to reject AstraZeneca’s Enhertu drug for breast cancer. The treatment has been found to double the life expectancy for terminal breast cancer patients, with trials also suggesting that the drug can cut the risk of terminal breast cancer spreading or growing by 38pc when compared with standard chemotherapy. 03:36 PM BST Investors ‘increasingly twitchy’ ahead of next week’s tech results Two of the three main Wall Street indexes are in negative territory this afternoon, with the tech-heavy Nasdaq Composite down 0.
7pc and the S&P 500 down 0.1pc. The Dow Jones is up 0.
5pc. David Morrison, senior market analyst at financial services provider Trade Nation said: Investors are becoming increasingly twitchy ahead of next week’s earnings reports which sees results from other Mag 7 [Magnificent Seven] members Microsoft, Meta, Apple and Amazon. This year’s tech rally has been fuelled by high hopes regarding artificial intelligence, but analysts have warned that the party could soon come to an end.
Fawad Razaqzada, analyst at City Index, said: The robust rally in the first half of the year set high expectations, particularly in the technology sector. Investors are concerned about the substantial investments in AI by companies like Alphabet, which currently act more as costs than revenue drivers. While AI could be profitable long-term, the short-term results have not met expectations, leading to investor caution.
03:33 PM BST Musk: Tesla board to discuss investing in xAI Elon Musk has said the board at Tesla will discuss making an investment in his artificial intelligence start-up xAI after holding a poll with users of his social media platform X, formerly known as Twitter. He tweeted: Looks like the public is in favor. Will discuss with Tesla board.
— Elon Musk (@elonmusk) With that I will sign off for the day and hand you over to the ever eager . 03:23 PM BST Ford shares crash as profits hit by warranty costs Ford shares suffered their worst drop in four years after profits were off-roaded by a surge in warranty repair costs. The car maker plunged 17pc in New York after it revealed as $800m spike in warranty payments the second quarter, catching investors by surprise.
Chief financial officer John Lawler called it a “one time” jump due to quality-related issues for models built in 2021 and earlier. As a result, adjusted earnings per share were 47 cents, well short of average estimates of 67 cents per share. Second-quarter revenue rose 6.
2pc to $47.8bn (£37.1bn).
Mr Lawler said: “We can’t read this quarter as the year is coming off track — it’s not.” 03:03 PM BST Anglo takes $1.6bn writedown on Yorkshire mine Anglo American revealed it has taken a $1.
6bn (£1.2bn) hit from its Yorkshire fertiliser mine as it slows down the pace of its development. The FTSE 100 miner announced in May that it is planning to scale back investment at the Woodsmith Mine in North Yorkshire after fending off a £39bn takeover bid from rival BHP.
BHP is no longer chasing a bid for Anglo but the group has committed to the Woodsmith overhaul after complaints about its cost from shareholders. It revealed the writedown on the Yorkshire mine, aimed at accessing the world’s largest known deposit of polyhalite, as part of its restructure designed to fend off further takeover attempts. It aims to spin off or sell De Beers diamond unit, separate platinum and sell its coal mines.
It also has also halted development of the Woodsmith project in Britain. Anglo American revealed underlying profits of $5bn (£3.9bn) in the first half of the year, helping shares rise 0.
8pc. Chief executive Duncan Wanblad said: Our decision to temporarily slowdown the Woodsmith crop nutrients project and thereby push out its production timing has resulted in a $1.6 billion impairment of the project.
As we progress our portfolio transformation, we expect to substantially reduce our overhead and other non-operational costs in phases, but weighted towards the end of the process to minimise business risk. 02:46 PM BST Jailed traders allowed to appeal rate-rigging convictions at Supreme Court Tom Hayes, the first trader jailed worldwide for interest rate rigging, has been given permission to appeal against his conviction at the UK Supreme Court, his lawyers said. Hayes, a former star Citigroup and UBS trader, was convicted in 2015 of conspiracy to defraud by manipulating Libor, a benchmark rate once used to price trillions of financial products globally.
He appealed against his conviction earlier this year alongside Carlo Palombo, a former Barclays trader convicted in 2019 of skewing Libor’s euro equivalent, Euribor. The Court of Appeal in London dismissed their appeals in March, ruling that it was illegal to take commercial interests into account when setting Libor or Euribor rates. But the Supreme Court has given them permission to appeal against that ruling, their lawyers said, meaning their battle to clear their names will go the UK’s highest court.
02:37 PM BST Wall Street edges higher as economy surges The main US share indexes opened flat - having earlier been expected to suffer losses - as investors drew comfort from stronger-than-expected economic growth a day after a tech stock rout on Wall Street. The Dow Jones Industrial Average was up 0.1pc at the open to 39,902.
32. The S&P 500 opened higher by 1.57 points, or less than 0.
1pc at 5,428.70, while the Nasdaq Composite gained 10.23 points, or 0.
1pc to 17,352.64 at the opening bell. Richard Flynn, managing director at Charles Schwab UK, said: Today’s figures show that the economy has grown more than expected.
Investors will likely feel reassured by this robust economic growth, which indicates that the Fed’s efforts to bring down inflation are not having the unwelcome side effect of tipping the economy into a recession. To limit price increases in recent months, the Fed has adhered to monetary policy that has limited earnings growth and spending power, leading to softening in the labour market. Historically, the sort of employment figures we are now seeing have been a clear indicator of recession, but today’s report indicates that the economy is not experiencing a slowdown – yet another instance in which this unusual economic cycle has bucked historical trends.
02:27 PM BST Fed to make ‘one or two’ rate cuts by the end of the year CJ Cowan, portfolio manager at Quilter Investors, said: It is worth noting that there are a lot of estimates in the first cut of GDP which means the figure is often heavily revised one way or the other. Structural changes to the economy in recent years mean revisions can be even more significant now, so it is worth taking today’s print with a pinch of salt and keeping a close eye on future readings. The US economy remains in a stronger position than the UK and Europe, adding complexity to the Federal Reserve’s interest rate decision making and increasing the apparent risk of a reacceleration in inflation.
This latest GDP print likely removes any hope of a July interest rate cut but we can still expect to see one or two by the end of the year. 02:14 PM BST Fed will have ‘strong case’ for September rate cut, say economists Stephen Brown, deputy chief North America economist at Capital Economics, said: The sharper-than-expected pick-up in second-quarter GDP growth to 2.8pc annualised should make the Fed a bit more comfortable about keeping policy unchanged next week, but the recent loosening of labour market conditions and signs of slower price growth still mean that there is a strong case for a cut at the following meeting in September.
01:54 PM BST US growth will ‘give Fed a headache’ As the US economy grew faster than expected in the second quarter Premier Miton chief investment officer Neil Birrell said: The US economy was flying in the second quarter, and GDP growth has blown estimates away. Even though inflation has eased a bit, it is still higher than many had hoped, and this cocktail will give the Fed a headache in advance of its meeting next week. It is likely we will see rate cut expectations wane and the volatility we are currently seeing in markets is unlikely to subside as a result of this strong data.
01:50 PM BST US unemployment benefit claims edge down Applications for US unemployment benefits remained at elevated levels, official figures show, although fewer Americans filed claims last week. Jobless claims for the week ending July 20 fell by 10,000 to 235,000 from 245,000 the previous week, the Labor Department reported. It is the ninth straight week claims came in above 220,000.
Before that stretch, claims had been below that number in all but three weeks so far in 2024. Weekly unemployment claims are widely considered as representative of layoffs, and though they have been slightly higher the past couple of months, they remain at historically healthy levels. The total number of Americans collecting unemployment benefits fell for the second time in three weeks.
About 1.85m Americans were collecting jobless benefits for the week of July 13, around 9,000 fewer than the previous week. The four-week average of claims, which evens out some of the week-to-week volatility, rose by 250 to 235,250.
4/ Continuing claims up 5% Y/Y, consistent with what is probably very slow, gradual, ongoing deterioration. — Guy Berger (@EconBerger) 01:45 PM BST Wall Street losses ease amid interest rate cut hopes US stock indexes reduced their losses after weaker-than-expected durable goods data lifted hopes for earlier interest rate cuts from the Federal Reserve. A report showed durable goods orders fell 6.
6pc in June, compared with expectations for a 0.3pc rise. Durable goods figures measure products such as vehicles and household appliances that are typically used repeatedly over a period of years.
Meanwhile, the US economy grew 2.8pc in the second quarter, the Commerce Department reported, which was well ahead of a forecast of 2pc. In premarket trading, the Dow Jones Industrial Average was up 0.
1pc, the S&P 500 was down 0.1pc, and the Nasdaq 100 e-had fallen 0.3pc.
United States Durable Goods Orders — TRADING ECONOMICS (@tEconomics) 01:41 PM BST US growth surges despite high interest rates US economic growth blew past expectations in the second quarter as it was boosted by consumer spending and stock building amid high interest rates. The Commerce Department said GDP grew by 2.8pc thanks to an increase in consumer spending “in both services and goods”.
Within services, the leading contributors were healthcare, housing and utilities, and recreation services. US consumers are still spending despite the Federal Reserve holding interest rates at 5.25pc to 5.
5pc, which is their highest level since 2001. United States GDP Growth Rate — TRADING ECONOMICS (@tEconomics) 01:32 PM BST US economy grows faster than expected The US economy expanded faster than expected in the second quarter of the year in a potential blow to hopes of imminent interest rate cuts. US GDP grew by 2.
8pc in the three months to June, according to the Commerce Department, which was much faster than the 2pc that had been predicted by analysts. The economy grew at a 1.4pc rate in the first quarter.
Growth remained considerably slower than the 4.2pc pace logged in the second half of last year. 01:22 PM BST Wall Street losses on track to continue after huge sell-off The Nasdaq and S&P 500 slipped further in premarket trading after a crushing selloff in megacap tech stocks steered the indexes to their biggest drop since 2022.
Lacklustre profit reports from Google-owner Alphabet and Tesla sparked jitters among investors about megacap stocks which have fuelled Wall Street’s rally this year. All three major US stocks indexes closed sharply lower, with the Dow Jones Industrial Average down 1.3pc, the S&P 500 falling 2.
3pc and the Nasdaq Composite dropping by 3.6pc. While the group of heavyweight stocks has powered the stock market to all-time highs this year, Wednesday’s sell-off was a wake-up call for investors, adding weight to fears that these stocks might be over-stretched and in for more turbulence.
Chris Weston, head of research at Pepperstone, said: One could argue that given the moves and flows we saw last week, the platform was already set, and investors were already questioning their position in big tech. Throw in clear disappointment in Alphabets Q3 capital expenditure guidance, and outright poor numbers from Tesla ..
. and we can see the effect in MAG7, semiconductors and the AI-related plays. In premarket trading, the Nasdaq 100 had fallen 0.
3pc, the S&P 500 was down 0.2pc and the Dow Jones Industrial Average was down less than 0.1pc.
Traders are now waiting to see US GDP figures due shortly. 01:07 PM BST Pound falls amid bets on summer interest rate cut The pound has fallen as traders ramped up bets on the Bank of England cutting interest rates for the first time in four years next week. Sterling dropped by 0.
3pc against the dollar to $1.287 having hit a one year high of $1.304 last week.
The pound was down 0.3pc against the euro, which was worth 84.3p, as traders increased bets ahead of the next Bank of England interest rate decision on August 1.
Two interest rate reductions now fully priced in by December, while next Thursday’s decision remains on a knife edge. Money markets indicate there is a 58pc chance of a cut. As a result, British bond yields fell, also weighing on the pound.
The shift was largely driven by a change in US interest rate expectations after a string of weaker than expected economic data and comments from former Federal Reserve officials backing a cut. Jane Foley, head of FX strategy at Rabobank, said: I think we are in for a little bit more volatility. But I do think sterling can continue to grind higher, particularly against the euro.
12:47 PM BST Nestle lowers growth expectations as shoppers look for cheaper products Swiss food giant Nestle has lowered its sales growth outlook for the year as it reduced the pace of its price increases. Shares in the group, whose brands range from Nespresso coffee capsules to Purina dog food, fell 4.6pc on the Swiss stock exchange as it indicated it has come under-pressure from consumers shopping for cheaper products.
Nestle said it now expected organic sales growth - which excludes currency fluctuations and acquisitions - of “at least 3pc” this year, down from its previous target of 4pc. The global packaged-food giant and its rivals had logged high sales growth in the past three years as they raised prices to make up for higher costs due to soaring inflation. The company increased prices by 2pc in the first six months of the year, compared to 9.
5pc over the same period in 2023, mirroring a slowdown in inflation in major economies. Organic growth slowed to 2.1pc in the first half, down from 8.
7pc in the same period last year. Nestle chief executive Mark Schneider said: “With this inflation wave now moderating very quickly, we are in a transition period. “There is value-seeking behavior among consumers.
There is pressure, especially in the low-income range. It’s a period right now where consumer mood is kind of muted.” 12:33 PM BST Beauty giant THG tells staff to come in five days a week Online beauty giant THG has told staff they must start coming in five days from next month, after too few staff were adhering to its request for them to ditch remote working.
Our retail editor has the latest: THG, whose brands include Myprotein and Espa, said the fact that people were not coming back into the office full-time was impacting the culture of the business, according to a memo, first reported by the Financial Times. In a separate memo, it said it would be making more job cuts, with around 171 roles at risk. Last December, THG asked staff to stop working from home, but said this was subject to potential flexibility.
In its latest memo, it said that “adherence to the policy has been inconsistent” and so it would now require people to return to the office from August 19. Any existing formal flexible working agreements will be upheld for now. Regarding the impending job losses, a spokesman said the company “is restructuring some business areas to ensure we continue to leverage recent investments, including in automation, technology and AI”.
The spokesman added: “Subject to the ongoing consultation, these changes will likely result in a limited number of roles becoming redundant. Whilst this is regrettable, THG will support all affected colleagues and seek to offer them an alternative role within the group.” 12:01 PM BST Crypto platform Coinbase fined £3.
5m for money laundering failures Cryptocurrency giant Coinbase has been fined £3.5m by the Financial Conduct Authority for failures in money laundering controls. Our technology editor has the details: The FCA said Coinbase’s UK entity, CBPL, had failed to honour an agreement not to take on “high-risk” customers while it improved its systems.
However, weaknesses in its controls meant it signed up 13,416 risky customers between October 2020 and October 2023, who were allowed to make transactions totalling $226m (£175m). The fine is the FCA’s first against a cryptocurrency company. It was reduced from £5m due to Coinbase agreeing to resolve the matter early.
The FCA said the customers’ activity had triggered 62 alerts to law enforcement about “potential money laundering, scams and fraud, and the sale of illicit substances and stolen credit card information on the darknet”. The transactions in question amounted to $1.75m.
There was no finding that the failings led to any financial crime. Coinbase entered into a voluntary agreement to avoid high-risk customers - a broad definition that includes unemployed individuals or those in industries such as pharmaceuticals and construction - after a routine FCA audit in 2020. 11:46 AM BST Banknote printer De La Rue raises doubts over future as loan repayment looms Banknote printer De La Rue has revealed doubts over its ability to continue as a going concern as it said it hopes talks over a sale of its two business divisions would reach a “successful conclusion” in the coming months.
The 200-year-old group - which recently put its currency and authentication businesses up for sale - said it had received further interest from suitors in both of its divisions and that negotiations are “progressing”. However, shares in the group fell 10pc as it revealed a “material uncertainty” over its financial future over the payment of a loan due in July next year. The group, which prints banknotes for the Bank of England and other central banks across the world, is hoping that the sale of its authentication arm will allow it to repay the loan.
However, it said there is uncertainty over the timing of any potential deal, which is “outside of the board’s control”. This means that there are doubts over its ability to continue as a going concern through to September 28 next year. De La Rue said that it was “confident that the range of strategic options and the progress being made with them will ultimately allow the group to repay the revolving credit facility in full before its expiration”.
Demand for notes has slumped after banks globally stockpiled cash during the pandemic, while online banking and contactless payments have soared in popularity. 11:30 AM BST State-owned energy company will ‘take time’ to make money, says Miliband Energy Secretary Ed Miliband has said “it’s going to take time” for Britain’s newly created state-owned energy company to start making money. He said the Government has set aside £8.
3bn to invest in new wind farms and solar projects, which must get built before Great British Energy, or GB Energy, can start generating a return. Legislation to establish the state-owned energy company needs to go through the House of Commons. He told BBC Breakfast: “Within the lifetime of this Parliament it will start generating returns.
” Asked when people can expect their bills to go down, he said: Within a couple of years, as we build new onshore wind, new solar, we’ll start to see the effect on bills, but there are lots of things going on here. So our exposure to gas prices, which are set internationally, is something I don’t control. In a sense, the whole point of what I’m saying is we’ve got to get off that lack of control where dictators like (Russian President Vladimir) Putin control the fossil fuel market, because I can’t promise you what’s going to happen to gas prices.
But I can say that, if we drive to clean, homegrown British energy, we will have much more control over what happens to bills. 11:20 AM BST Ford loses $50,000 on every electric car Ford loses nearly $50,000 (£38,700) on every electric car it sells, results from the company show, as traditional manufacturers struggle with the switch away from petrol. Our industry editor has the details: The company posted a loss of $1.
1bn for its electric vehicle division, Ford E – equivalent to about $47,600 per car. It sold 23,957 electric vehicles (EVs), an increase of 61pc from a year earlier. The numbers contributed to a , with the business on track to lose $5bn overall this year.
Ford blamed a for the loss, which came despite efforts to slash costs by $400m. Read how it . 11:11 AM BST HSBC punished for misleading customers over bank branch closures HSBC has been ordered to make changes by competition regulators after it was found to have mislead customers over bank branch closures.
The Competition and Markets Authority (CMA) said the lender had listed 167 closed branches as still being open. HSBC has closed 743 banks since 2015 according to Which?. The regulator has issued directions to prevent further breaches after HSBC also failed to keep some of its annual rates for business loans and overdrafts accurate and up to date on its website.
It found that HSBC also told some customers the incorrect maximum amount they would be charged for going into unarranged overdraft on their current accounts. The CMA announced that Lloyds, TSB and Allied Irish Bank (AIB) also broke Britain’s competition rules, but these were merely issued with public letters. CMA senior director Dan Turnbull said: People deserve banks they can trust to serve them well.
Having correct information is essential when making important decisions about our finances. Banks handling our hard-earned money should have adequate processes in place to ensure this happens. It’s disappointing that 7 years on, we have to put in place formal enforcement measures to secure better compliance from a major bank like HSBC which, yet again, is in breach of the rules.
The CMA will continue to closely monitor all banks’ compliance to ensure customers can clearly and confidently manage their finances. 10:51 AM BST Hammerson pushes for ‘logical’ tourist tax Brent Cross and Bullring owner Hammerson has thrown its backing behind calls for the government to scrap ‘tourist tax’. Our correspondent has the latest: Chief executive Rita-Rose Gagné said it is “absolutely logical” that tax-free shopping for tourists “will help the UK economy”.
Ms Gagné said: “It is something that must continue to be pushed. In the business community, we continue to advocate for it.” The landlord sold its stake in Bicester Village owner Value Retail earlier this week for £600m to LVMH-backed fund L Catterton, three years into its turnaround strategy.
However, that stake was sold for £483m under its book value, causing the landlord to post a £517m loss for the six months ending 30 June and slip back into the red. Ms Gagné said the sale “unlocks” Hammerson’s potential, adding: “The best phase is yet to come..
. we can turn the page now and put ourselves in a completely different place. We’ve reshaped, refocused and will scale back up.
” Hammerson shares were down 1.4pc. 10:38 AM BST UK bond market rallies amid stock sell-off Investors raced to buy-up British debt amid a rush to safe haven assets following the global rout in stocks.
The yield on two-year UK gilts - the return the government promises to pay buyers of its bonds - fell to 3.89pc, which is its lowest level since February. It comes as traders also ramped up bets on a summer interest rate cut by the Bank of England, with money markets indicating there is a 55pc chance of a cut in August.
The yield on 10-year gilts fell nearly five basis points to 4.11pc. Yields move inversely to prices.
10:30 AM BST Egypt puts up petrol prices by 15pc Egypt has announced a 15pc increase in petrol prices as part of a reform package requested by the International Monetary Fund in exchange for a $5bn (£3.9bn) loan to the cash-strapped government. The Egyptian petroleum ministry said the price rise would come into effect on Friday.
The announcement comes ahead of an IMF meeting on Monday to review the April payout package, unlocking $820m in funds after Cairo received another such tranche of the loan in late June. Egypt is suffering its worst ever economic crisis, with ballooning foreign debt driving up inflation and resulting in several consecutive devaluations of the local currency against the dollar. Inflation peaked at nearly 40pc last year, before winding down to 27.
5pc in June. The IMF has demanded wide-ranging reforms, most notably adopting a liberal exchange regime as well as limiting government spending and incentivising private investment. Alongside the economic crisis, Egypt has also been caught in regional tensions, with bloody wars raging in neighbouring Gaza and Sudan.
10:18 AM BST TotalEnergies profits slump amid falling gas prices French oil heavyweight TotalEnergies reported falling profits in the second quarter, blaming lower margins in refining and falling sales and prices for natural gas. Net profit in the three months to June fell to $3.8bn (£3bn), down 7pc on the same period last year.
Analysts had forecast around $4.9bn. TotalEnergies’ liquid natural gas (LNG) business saw its adjusted net operating income retreat 13pc “in a context of lower LNG demand in Europe” sapping both sales and prices.
Prices and demand for LNG have fallen as European stockpiles remain higher than usual for the time of year amid milder weather and as the energy crisis triggered by the war in Ukraine has abated. There was a still steeper tumble of more than a third for TotalEnergies’ refining and chemicals operation, which it blamed on “lower refining margins mainly in Europe..
. and the Middle East”. But elevated oil prices ensured the group’s exploration and production division, by far its largest, saw a 14pc boost in its operating result.
The electricity unit, which includes renewable energy, also scored a double-digit increase. Over the first six months of 2024, TotalEnergies’ adjusted net income fell 15pc to $9.8bn.
10:02 AM BST China cuts rates in bid to reinvigorate economy Just as world stocks suffered a downturn, China ratcheted up its effort to reinvigorate its economy by cutting a key policy rate and interest paid on bank deposits. The People’s Bank of China said it cut the lending rate for one-year medium term policy loans by 20 basis points to 2.3pc.
It is the biggest rate cut since China’s economy was brought to a halt by the pandemic in 2020. The rate on 7-day loans was reduced to 1.7pc.
Separately, |Beijing said it will allocate 300 billion yuan (£32.2bn) in ultra-long-term treasury bonds to support a programme of equipment upgrades and consumer goods trade-ins. Of the total, 148 billion yuan will be used for supporting equipment upgrades, according to a notice issued by the country’s state planner and finance ministry.
Amid the global stocks sell-off, Chinese markets extended this year’s declines, which has seen it trail rising share prices in many other countries. The Hang Seng in Hong Kong fell 1.8pc to 17,004.
97 while the Shanghai Composite dropped 0.5pc to 2,886.74.
09:49 AM BST German economy ‘stuck in crisis’ as confidence unexpectedly falls German’s economy is “stuck in crisis,” new research suggests, after confidence among bosses unexpectedly fell. The ifo Business Climate Index fell to 87 points in July, after hitting 88.6 points in June, as all sectors suffered a downturn.
Bosses assessment of the climate for its significant manufacturing sector was “considerably poorer” as expectations and order backlogs declined. It comes after closely watched PMI data on Wednesday showed an unexpected decline, highlighting Germany’s struggle to move past two years of stagnation since the pandemic. Ifo President Clemens Fuest said: The companies were less satisfied with the current business situation.
Skepticism regarding the coming months has increased considerably. The German economy is stuck in crisis. 09:38 AM BST Unilever leads FTSE 100 as turnaround shows ‘promising signs’ Consumer goods giant Unilever has risen 5.
4pc to top the FTSE 100 after it increased its profitability in the first half of the year. Julie Palmer, partner at Begbies Traynor, said: Today’s results from Unilever suggest that the new CEO’s focus on streamlining the conglomerate’s operations is beginning to pay off. After a difficult patch, the underlying sales performance increased 4.
1% which suggests he’s having some early success. The planned sale of its ice cream division, which is clearly still a weakest link, alongside the decision to cut 3,200 office jobs in Europe, have already begun to revitalise the FTSE 100 giant and its share price after a period of slower growth and activist pressure. With a diversified portfolio containing iconic products from Marmite to Dove soap, the decision to home in on these so-called Power Brands is a strategy that is already showing some promising signs of success.
The brands represent around 75pc of group revenue and delivered 5.7pc growth in H1. Despite inflation falling, consumers are clearly still feeling the pinch, making these power brands all the more valuable in their ability to deliver volume-led growth at a time where price increases are difficult to implement.
As the consumer goods giant presses on with its much-needed turnaround, the market should feel more confident that Unilever is positioned for sustainable growth at a time where other big names in consumer goods are floundering. 09:30 AM BST Traders ramp up bets on summer interest rate cut Money markets show increasing bets on a summer interest rate cut by the Bank of England amid signs that the UK economy is growing steadily. Traders think there is a 55pc chance that policymakers will cut interest rates next week, up from a 45pc chance on Wednesday.
If it does not happen, derivatives trades indicate that there is a 94pc chance of rates being reduced in September, up from 85pc a day earlier. It comes as PMI data showed Britain’s private sector increased prices at the slowest rate in almost three and a half years, while factory output grew at its fastest pace in two years. 09:15 AM BST Centrica falls to bottom of FTSE 100 as profits halved It has been a mammoth results day across the UK and Europe - with updates coming just as investors get jittery about share prices.
British American Tobacco rose 2.9pc after it reported a 1.3pc rise in half-year profit, which exceeded analyst expectations.
Centrica slipped to the bottom of the FTSE 100 with a 9.2pc decline after the energy company reported a fall in first-half adjusted operating profit. BT shed 3.
8pc after the mobile and broadband provider delivered its trading statement for the first quarter. 09:07 AM BST FTSE 100 hits lowest level in three months amid share sell-off The FTSE 100 fell to its lowest in nearly three months as the global sell-off in shares spread to Europe. The blue-chip index was down 0.
8pc, and the mid-cap FTSE 250 had fallen 1pc. Precious metal miners lead declines, dropping as much as 5.2pc, with gold miners Fresnillo and Endeavour Mining slipped over 3pc each, as spot gold prices tumbled.
Globally, investor sentiment was dampened after big tech companies Alphabet and Tesla failed to impress investors, leading to heavy losses on the Nasdaq and the S&P 500 on Wednesday. In Britain, Centamin slipped as much as 9.7pc to the bottom of the FTSE 250 after it announced its interim results and left its 2024 outlook unchanged.
Energy companies fell 1.4pc and industrial miners dropped as much as 1.8pc in tandem with oil and copper prices.
Rentokil shares fell 6.2pc after the pest-control company reported its interim half-yearly results. The personal care, drug and grocery sector was the only outlier, gaining as much as 4.
2pc as Dove soap maker Unilever climbed as much as 7.1pc after it beat profit estimates for the first half of the year. 08:51 AM BST Treasury rules out scrapping 1p and 2p coins The Treasury has denied that 1p and 2p coins are to be scrapped after none were ordered from the Royal Mint this year.
Multiple reports had suggested the coins could be reaching the end of their life amid the continuing decline in cash transactions. A HM Treasury spokesperson denied that this was the end of the road for the smallest denominations and the lack of orders was down to having enough coins in circulation. “We are not scrapping 1p or 2p coins,” they said.
“We are confident there are enough coins in the system without the need to order more this year.” The Treasury requests the Royal Mint to produce coins, which can have lifespans lasting decades, to meet the needs of the economy. There were several years in the early 1970s and early 1980s when no 2ps were produced with neither 1p or 2p coins produced in 2018.
In the same year, then Chancellor Philip Hammond labelled the smallest coins “obsolete” but pledged to keep them and protect cash a year later. A Treasury spokesperson told The Standard it estimates approximately 27 billion coins are in circulation in the UK. 08:33 AM BST Universal Music Group shares plummet after stock downgrades Universal Music Group shares suffered a record plunge after analysts downgraded the company amid concerns over is streaming income.
The company plunged by as much as 28pc despite revealing better than expected revenue amid growing subscription revenue and merchandising. Revenue rose to €2.9bn (£2.
5bn) in the three months to June, with its top sellers including releases by Taylor Swift and Billie Eilish. However, analysts at Citi, Barclays, Guggenheim and Kepler Cheuvreux all lowered their ratings, with Citi saying streaming and subscription growth was meaningfully below what had been expected. It raised concerns about volatility between the music giant’s different lines of revenue.
08:15 AM BST Gucci-owner tumbles after profit warning Gucci-owner Kering tumbled as trading began in Paris after it warned that profits will tumble in the second half of the year as demand for luxury goods slumps. The French multinational dropped 10pc as it said its recurring operating income, a key profit measure, could fall by about 30pc in the period compared with the previous year. The company is struggling with turnaround efforts at Gucci, which accounts for two-thirds of its profits.
It had issued an earlier profit warning in April because of weak demand, particularly in China. 08:04 AM BST UK markets slump amid tech sell-off The FTSE 100 has been swept up in the global market sell-off that began with a rout on Wall Street. The UK’s blue-chip index fell 0.
8pc to 8,098.45 shortly after markets opened, while the midcap FTSE 250 fell 1.1pc to 20,859.
00. 08:01 AM BST Hollywood strikes take shine off ITV results ITV suffered a drop in revenues in the first half of the year as an advertising boost from England’s Euros campaign was offset by the impact of Hollywood strikes. Our reporter has the details: The broadcaster reported a 13pc drop in revenues from its production business to £869m in the six months to the end of June.
Bosses have previously warned that the walkouts by US actors and writers, which brought Hollywood to a standstill last year, will lead to around £80m of revenue being delayed to 2025. ITV Studios has also been hit by lower demand for shows from other free-to-air broadcasters across Europe against a torrid backdrop for the sector. The production slowdown offset strong advertising growth for ITV, which cashed in on England’s journey to the final of Euro 2024.
Total advertising revenue jumped 10pc to £889m in the first half of the year, ahead of previous expectations. Overall, ITV reported a 3pc decline in total revenue to £1.9bn.
Statutory profit before tax was £330m, a sharp increase from last year as the company cashed in on the sale of its stake in streaming service Britbox International to partner BBC. ITV today also announced that it has bought Hartswood Films, the production company behind hit series including Sherlock. 07:56 AM BST Unilever sales disappoint as shoppers put off by higher prices Consumer goods giant Unilever reported worse than expected sales after it was unable to win back shoppers it had alienated in recent years with higher prices.
The maker of Dove soap and Hellmann’s condiments reported a 3.9pc rise in second-quarter underlying sales, missing an average analyst forecast of a 4.2pc increase.
Underlying price growth for the quarter was 1pc, which was lower than market expectations, but underlying volume sales growth ran ahead of estimates at 2.9pc. Chief executive Hein Schumacher has launched a turnaround plan for the business that involves spinning out its ice cream unit, which it aims to by the end of next year.
It emerged earlier this month that the Marmite maker is across Europe. He said: “There is much to do, but we remain focused on transforming Unilever into a consistently higher performing business.” The company maintained its underlying sales growth forecast of 3pc to 5pc, mostly driven by volume.
Underlying operating margin for the year is expected to be at least 18pc, it said. Underlying operating profit rose 17pc to €6.1bn (£5.
1bn) for the six months to June while the underlying operating margin widened 250 basis points to 19.6pc, although the company expects that to slow in the second half. 07:47 AM BST British Gas profits tumble as energy crisis payments end British Gas owner Centrica revealed tumbling profits in its household supply arm after an energy crisis allowance payment was not repeated and as it said the UK was moving to a “more normalised” gas and electricity market.
Centrica said that underlying earnings in British Gas Energy slumped to £159m in the six months to June 30 from £969m a year ago. It said that around £500m of the fall was due to the absence this year of energy crisis allowance payments. Regulator Ofgem allowed energy suppliers to recover costs that they had racked up during the crisis, but this has now come to an end.
The wider Centrica group reported underlying earnings of £1bn for the first half of 2024, but said group profitability will be “heavily weighted” to the first half. The company also announced that chairman Scott Wheway will step down after five years heading the board, to be replaced by senior independent director Kevin O’Byrne on December 16. Group chief executive Chris O’Shea said: Our core businesses continued to deliver in line with our expectations in the first half of 2024, against the backdrop of more normalised market conditions.
Against the medium-term profit objectives we set out last year, we are on track to deliver two years ahead of schedule for the majority of our businesses, and we continue to ramp up our investment programme, including in innovative technologies that will support the UK and Ireland’s net zero ambitions. 07:38 AM BST Centrica profits halved in blow to small investors British Gas owner Centrica revealed its profits were cut in half in the latest blow to Britain’s small investors and pension funds. Our energy editor has the latest: Centrica’s profits for the first half of this year fell to £1bn compared with £2.
1bn in the same period last year. British Gas, its main subsidiary, is the key cause of the decline. Its adjusted operating profit fell to £159m this year compared with £969m last year.
The news will be a blow to the group’s 500,000 small shareholders - many of whom are both customers and the original “Sids” - the name given to those who bought shares when British Gas was privatised. It will also impact pensioners more widely - the group’s main institutional investors are UK pension funds. 07:33 AM BST Lloyds profits better than expected as it sets aside less for bad loans Lloyds has revealed earnings dipped this year as it generated less income, although profits were higher than expected as it set aside less money for bad loans.
The banking group, which also includes brands Halifax and Bank of Scotland, said it made pre-tax profit if £3.3bn in the first six months of the year. This marks a 14pc decline from the £3.
9bn reported this time last year, however, it comes in higher than some analysts had predicted. It set aside £44m for bad loans during the latest quarter, which was much less than the £323m analysts were expecting. The bank also revealed that its balance sheet grew this year with both lending to consumers, including mortgages, and the amount in savings and current accounts increasing.
Lloyds chief executive Charlie Nunn said the bank delivered “robust financial results” in the first half of the year. 07:23 AM BST Revolut given UK banking licence after three-year wait Revolut has been given a UK banking licence bringing an end to its long wait for regulatory approval after a series of accounting missteps. The fintech company, which has nine million UK customers and 45m around the world, first applied to the Bank of England’s Prudential Regulation Authority for a banking licence in January 2021.
However, it was unable to secure the licence after its own auditors previously issued a qualified opinion on its accounts, saying they were unable to satisfy themselves over the “completeness and occurrence” of nearly £500m of revenue. Revolut recently published its full inancial accounts for 2023, announcing that group revenues surpassed $2.2bn (£1.
7bn), with record profits before tax of $545m (£422.9m). It has now received its UK banking licence with restrictions from the Prudential Regulation Authority.
It now enters the “mobilisation” stage, sometimes referred to as “Authorisation with Restrictions”, which is a common step for many new banks in the UK. Revolut chief executive Nik Storonsky said: “We are incredibly proud to reach this important milestone in the journey of the company and we will ensure we deliver on making Revolut the bank of choice for UK customers.” Its UK chief executive Francesca Carlesi added: “It is a tremendous responsibility to be a bank in the UK and we will work relentlessly to offer products and services that improve the financial lives of everyone who uses Revolut.
” 07:08 AM BST European markets poised to fall amid stocks sell-off European markets are on track to open lower as a slump in global tech stocks sent investors fleeing into less risky assets, including short-dated bonds, the yen and Swiss franc. Asian shares were hammered overnight, with the the FTSE 100 poised to open lower by 0.3pc, the Cac 40 in Paris set to drop 1.
1pc and the Dax in Frankfurt on course to fall 0.4pc. Chinese stocks, iron ore and oil prices dropped further after the country’s central bank sprang a surprise cut in longer-term interest rates, only stoking further worries about the world’s second-largest economy.
The sell-off in stocks saw investors ramp up bets on rate cuts globally, with futures implying a 100pc chance of a Federal Reserve easing in September. MSCI’s broadest index of Asia-Pacific shares outside Japan lost 1pc, while Japan’s Nikkei tumbled 3.3pc, exacerbated by a 11pc plunge in Nissan Motor after its quarterly profit slumped 99pc.
Taiwan’s markets were closed for a second day due to a typhoon. Chinese blue-chips slid 0.9pc with the Shanghai Composite index falling 0.
9pc to a five-month low. Hong Kong’s Hang Seng plunged 1.7pc, finding little support from Beijing’s latest easing step.
On Wall Street, the Nasdaq lost almost 4pc - the worst one-day fall since 2022 - as lacklustre Alphabet and Tesla earnings undermined investor confidence in the already lofty valuations of the “Magnificent Seven” stocks. 07:03 AM BST Good morning Asian markets tumbled after a tech-fuelled sell-off on Wall Street, as disappointing results caused traders to panic that a months-long rally in the sector may have been overdone. Tokyo’s Nikkei led the retreat in equities, with a stronger yen adding to the downward pressure on exporters, while technology giants across the region were deep in the red.
1) | Homeowners on cheaper deals risk falling behind on bills after refinancing, warns IFS 2) | Troubled supplier risks fines after credit rating slashed by Moody’s agency 3) | Vincent Bolloré’s’ TV channel C8 has been accused of promoting far-Right views 4) | Rents on primary care sites are too low to cover cost of Labour’s plan to ease burden on hospitals 5) | Deal comes as Gulf state aspires to become a major player in artificial intelligence Asian shares dropped after US stocks suffered their . Japan’s benchmark Nikkei 225 lost 3.1pc to 37,949.
50. Australia’s S&P/ASX 200 shed 1.2pc to 7,870.
40. South Korea’s Kospi declined 1.5pc to 2,717.
72. Hong Kong’s Hang Seng declined 1.7pc to 17,010.
89, while the Shanghai Composite fell 0.5pc to 2,887.48.
Among the region’s technology shares, Samsung Electronics fell 2pc, while Nintendo was down nearly 2pc. Tokyo Electron tumbled nearly 5pc. It comes after disappointing results from Tesla and Google-owner Alphabet sent US stocks plunging.
The S&P 500 lost 2.3pc, to 5,427.13 points, while the Nasdaq lost 3.
6pc, to 17,342.41, on its worst day in two years. The Dow Jones Industrial Average 1.
3pc, to 39,853.87. The yield on benchmark 10-year Treasury bonds rose to 4.
28pc from 4.25pc late Tuesday..
