FTSE 100 today: Blue-chip poised to end two-week winning streak amid global uncertainty

Moving markets today: Asia follows Wall Street lower, oil prices slide, Japan core inflation rises, Netflix beats subscriber targets; Focus shifts to UK retail sales data 

US stocks declined overnight, continuing a broader downtrend after a tech-heavy sell-off the previous day. Asian markets are likely to end the week on a negative note due to ongoing geopolitical uncertainties and economic concerns, even as the global trend of easing interest rates begins. Oil prices dropped on Friday, setting up for a second consecutive weekly decline, as mixed economic signals and a stronger dollar dampened investor sentiment. Gold prices also fell on Friday but are on track for a fourth straight weekly gain, driven by expectations that the Federal Reserve might cut US interest rates in September, which has increased gold’s appeal as a non-yielding asset. In the UK, GfK consumer confidence has risen to its highest level in nearly three years. Meanwhile, Japan’s core inflation ticked up in June, keeping the possibility of a Bank of Japan rate hike in play. Netflix exceeded its subscriber targets but warned of slower growth in ad revenue. UK retail sales data is set to be released on Friday, and speeches by US Federal Reserve officials John C. Williams and Raphael Bostic, as well as earnings reports from American Express, are also anticipated. Britain’s FTSE 100 is poised to end the week with a loss, breaking a two-week winning streak, despite a 0.2 per cent gain on Thursday.

Here are five key takeaways for your day. 

UK consumer confidence reaches near 3-year high: GfK

Consumer confidence in Britain hit its highest point in almost three years this month, as reported by a survey on Friday.  

Despite the recent government changes and the England men’s soccer team’s activities, these factors did not significantly impact the results.  

The GfK consumer confidence survey, the oldest of its kind in the UK, improved to -13 in July, marking its highest level since September 2021, Reuters reported.

However, this was only a modest improvement from June’s -14 and fell short of the predicted -12. 

Japan’s core inflation rises in June, keeping BOJ rate hike possibility alive

In June, Japan’s core consumer prices rose by 2.6 per cent from the previous year, marking a second consecutive month of acceleration and fueling expectations that the central bank might soon increase interest rates.  

This core consumer price index (CPI), which excludes volatile fresh food prices, came in just short of the 2.7 per cent forecast but followed a 2.5 per cent rise in May.  

Higher energy costs, driven by reduced government subsidies for utility bills, surged 7.7 per cent year-on-year in June, up from 7.2 per cent in May, which helped boost overall inflation.  

Additionally, an index excluding fresh food and fuel costs, which the Bank of Japan monitors for broader price trends, increased by 2.2 per cent in June, slightly up from 2.1 per cent in May. 

Netflix surpasses subscriber targets but warns of slow Ad revenue growth

Netflix added 8 million new subscribers, fueled by hits like “Baby Reindeer” and “Bridgerton,” but warned of a slowdown in sign-ups for the current quarter compared to the same time last year.  

The company’s earnings jumped 42 per cent to $4.88 per share on $9.5 billion in revenue, exceeding Wall Street expectations.  

Despite this, Netflix expects fewer new subscribers this quarter compared to last year when their password crackdown took effect, leading to a 4 per cent drop in shares during after-hours trading.  

The company also noted that its ad-supported tier now accounts for 45 per cent of sign-ups in available markets, but doesn’t anticipate it becoming a major revenue driver until 2024 or 2025. 

What’s on the radar

UK retail sales figures are set to be released on Friday before the markets open, with economists anticipating a -0.4 per cent decrease, a sharp contrast to the previous 2.9 per cent rise.  

Attention will also be on speeches from US Federal Reserve policymakers John C. Williams and Raphael Bostic.  

Additionally, the earnings reports from American Express, Schlumberger, Travelers, and Halliburton are expected to be key points of interest. 

Asian stocks slide amid tech rout and global market uncertainty

The Dow Jones Industrial Average decreased by 1.29 per cent to 40,665.02, while the S&P 500 dropped 0.78 per cent to 5,544.59, and the Nasdaq Composite fell 0.7 per cent to 17,871.22.  

Though Nasdaq and Meta recovered slightly from steep declines earlier in the week, major tech stocks like Apple, Amazon, Microsoft, and Alphabet continued to slide. 

Domino’s Pizza saw a significant drop of 13.6 per cent after its quarterly same-store sales failed to meet expectations.  

On the other hand, homebuilder D.R. Horton exceeded profit forecasts and delivered more homes than anticipated, resulting in a 10.1 per cent surge in its shares and pushing the Philadelphia SE Housing index to a record high. 

Warner Bros Discovery shares increased by 2.4 per cent following news of potential plans to separate its digital streaming and studio businesses from its traditional TV networks.  

However, Netflix shares declined in after-hours trading after the company released its quarterly results. 

In Asian markets, Japan’s Nikkei N225 fell to its lowest in over two weeks, down 0.1 per cent, extending a sharp 2.4 per cent fall from the previous session.  

Tech stocks struggled, with South Korea’s KOSPI and Taiwan stocks both declining over 1 per cent. Chinese blue-chip CSI300 dropped 0.08 per cent and the Shanghai Composite Index fell 0.07 per cent, while Hong Kong’s Hang Seng index slid 1.5 per cent. 

In the commodities market, oil prices declined amid mixed economic signals affecting investor confidence. Brent crude futures fell by 0.58 per cent to $84.62 a barrel, and US crude futures dropped 0.81 per cent to $82.15 a barrel.  

Gold also fell by 0.8 per cent to $2,425.19 an ounce, pulling back from a record high reached earlier in the week due to prospects of lower global interest rates.

Britain’s FTSE 100 is poised to end the week with a loss, breaking a two-week winning streak, despite a 0.2 per cent gain on Thursday.