The latest updates on the FTSE 100 and London’s financial markets from City A.M.’s newsroom in the heart of the City of London.
The S&P 500 halted its recent streak of gains after lower-than-expected inflation data for June prompted traders to anticipate potential interest rate cuts by the Federal Reserve later this year.
Overnight, the S&P 500 dropped 0.88 per cent to close at 5,584.54, and the Nasdaq fell 1.95 per cent to 18,283.41, ending its seven-day streak of record highs. The Dow Jones Industrial Average edged up by 0.08 per cent to 39,753.75 points.
This marked the Nasdaq’s biggest single-day drop since April 30. Despite signs of easing inflation, major tech stocks stumbled: Microsoft and Amazon both fell over 2 per cent, Meta Platforms slipped about 4 per cent, and Tesla plummeted 8.4 per cent following news of a two-month delay in its robotaxi launch.
Apple, after hitting a record high on Wednesday, declined 2.3 per cent even as BofA Global Markets raised its price target due to expected strong iPhone sales driven by new AI features.
Futures for the S&P 500 were stable, Nasdaq futures dipped slightly by 0.02 per cent, and EURO STOXX 50 futures remained flat.
In the UK, the FTSE 100 rose 0.36 per cent on Thursday, with predictions for a 0.10 per cent gain on Friday, reaching 8,256.0 points.
In Asia, Japan’s Nikkei N225 fell 2.3 per cent dragged down by tech stocks, and South Korea’s tech-heavy Kospi Index also saw declines.
In contrast, Australian shares advanced, and Hong Kong’s Hang Seng rose by 1.72 per cent. On the Chinese mainland, the Shanghai Composite and the Shenzhen Composite dropped by 0.09 per cent and 0.29 per cent, respectively.
In the commodities market, oil prices climbed during early Asian trading on Friday, buoyed by strong summer demand and lower inflation in the US Brent futures increased by 0.4 per cent to $85.74 per barrel, and US West Texas Intermediate (WTI) crude rose by 0.56 per cent to $83.08 per barrel.
Meanwhile, gold edged down 0.07 per cent to $2,413 an ounce.
China experienced an 8.6 per cent year-on-year increase in exports in June, while imports declined by 2.3 per cent, according to recent customs data released on Friday.
The two-year US Treasury yield, which reflects market expectations for interest rates, dropped to a four-month low of 4.1680 per cent overnight.
Japan’s top currency official hinted at potential intervention following a significant yen spike fueled by revived expectations of a US interest rate cut in September. The yen jumped nearly 3 per cent on Thursday, its biggest daily rise since late 2022.
Wall Street is gearing up for a busy earnings season, starting with reports from Citigroup, JP Morgan, and Wells Fargo on Friday.
Inflation remains a hot topic on both sides of the Atlantic. In the US, the Department of Labor will release June’s producer price data, and the University of Michigan will share preliminary results of its July consumer confidence survey, both of which could influence the markets.
Meanwhile, in Europe, consumer price data for June will be released for France and Spain.