6.50am: Plunge predicted for Friday
The FTSE 100 index looks set for big falls on Friday in tandem with overnight plunges by US stock futures and Asian markets after US tech results failed to excite and amid worries over spiralling coronavirus infections and the outcome of next week’s presidential election.
Spread betting firm CMC Markets expects the blue-chip index to open around 90 points lower at 5,490, having closed flat yesterday, just off 1 point at 5,581.75. The Footsie recouped earlier falls on Thursday after New York stocks started with gains after the US reported a record quarterly GDP growth number.
Overnight in New York, the Dow Jones Industrials Average closed 139 points, or 0.5% higher at 26,659, albeit having dropped 900 points on Wednesday, its biggest fall since June. The broader S&P 500 index recovered 1.2% and the tech-laden Nasdaq Composite rallied 1.6%
However, the mood turned after-hours in New York, with US futures dropping sharply as the big batch of tech numbers prompted profit-taking in the recent high-flyers.
Naeem Aslam, chief market analyst at Avatrade.com said: “Big tech stocks impressed Wall Street by beating their revenue estimates; however, some failed to excite other metrics. For instance, Apple smashed the sales number for the fiscal third quarter. The sale number came in at $64.7 billion; however, Greater China sales plummeted by 29%. This is a concern for investors because China is a major market for Apple, and the fact that sales have dropped in China has raised alarm bells for investors.
“As for the social media giants, Twitter’s sales number was impressive; sales revenue soared by 14% to $936 million. Speculators who were looking for a drop of 5% in the sales number are likely to face pain as the stock may attract new investors. However, the disappointing element was that the user growth wasn’t impressive, and this may trigger some profit-taking.
“Facebook showed that it has the ability to weather the ad boycott storm as the sales number bumped 22% to 21.5 billion. Monthly active users also confirmed strong growth.”
With the tech declines, Asian markets were hammered on Friday, with Hong Kong’s Hang Seng index dropping 1.8%, and Japan’s Nikkei 225 index off 1.5%.
In London, the corporate spotlight Friday will be on NatWest PLC (LON:NWB), the last of the FTSE 100 banks to report third-quarter numbers.
Around the Markets:
- Pound down 0.2% to US$1.2905
- Gold up 0.2% to US$1,870.15
- Brent Crude Oil down 1% to US$37.29
6.45am: Early Markets – Asia/Australia
Shares in the Asia-Pacific region fell heavily after US stock futures declined on Friday trading with the Dow Jones Industrial Average futures dropping 1.91%.
In Japan, the Nikkei 225 fell 1.52% whiles South Korea’s Kospi dived 2.33% below the flatline.
Hong Kong’s Hang Seng slipped 1.89% by the afternoon along with mainland Chinese stocks, with the Shanghai Composite down 1.19%.
Australia’s S&P/ASX 200 rose by as much as 0.4% in early trade but later gave up its gains and closed 0.55% lower.
Proactive Australia news:
Strategic Elements Ltd (ASX:SOR) is escalating development of self-charging flexible battery technology under collaboration with the University of New South Wales (UNSW) and will achieve scale-up of 1-litre of ink within the next four weeks.
Lithium Australia NL’s (ASX:LIT) (OTCMKTS:LMMFF) (FRA:3MW) 90%-owned Envirostream Australia Pty Ltd has received grant funding of $201,399 from Sustainability Victoria under the e-Waste Infrastructure Grant Round 2.
Lotus Resources Ltd (ASX:LOT) has completed a scoping study for Kayelekera Uranium Project in Malawi, Africa, which demonstrated its capacity to be one of the first operations to globally restart uranium production to meet a growing supply shortfall.
YPB Group Ltd (ASX:YPB) made significant business achievements with technical and commercial advances in the third quarter of the current year despite ongoing impediments from COVID-19 restrictions. Nanoveu Ltd (ASX:NVU) is experiencing growing interest in its antiviral products evidenced by the September quarter which saw increased international sales momentum.