Morning Note: A Round-up of Global Financial Market News.
Market News
US equities fell again last night – S&P 500 (-1.4%); Nasdaq (-2.2%) – as a fresh bout of selling weighed on the technology sector ahead of highly anticipated results from memory chipmaker Micron Technology. The Philadelphia Semiconductor Index — which had doubled from war-driven lows — slid sharply. Bank of America’s Bubble Risk Indicator puts the Nasdaq just below the 0.8 level associated with elevated near-term tail risks. After-hours, Nasdaq 100 futures recovered somewhat, with the market currently expected to open 0.5% higher this afternoon.
NIKE rose by 2% after hours following an update on its Q4 results which will include a benefit from tariff refunds that was not contemplated in the company’s previously provided guidance. Excluding this one-time benefit, the figures are expected to be generally in line with previously provided guidance. The full results will be released as scheduled next Tuesday. The company also announced a planned CFO transition in which David Denton, currently CFO of Pfizer, will join the company in October.
In Asia this morning, equities were mixed: Nikkei 225 (-0.8%); Hang Seng (+0.4%); Shanghai Composite (+0.1%). Samsung Electronics was supported by a report that the firm may announce a buyback. Traders are on intervention watch after renewed weakness in the yen.
The FTSE 100 is currently little changed at 10,429, while Sterling trades at $1.3190 and €1.1620. The UK 10-year gilt yield has fallen to 4.78%, extending declines for a second session, as weaker UK flash PMI data reinforced expectations of slower economic momentum and reduced the likelihood of Bank of England rate hikes.
The UK property sector is firm this morning in response to takeover news. US-based giant Prologis has offered 925p per share in an all-share deal to buy SEGRO. The Board has unequivocally rejected the proposal which is equal to SEGRO’s last reported EPRA NTA per share. SEGRO is up 16% to 860p in response, while peers Tritax Big Box and LondonMetric have also risen.
The yield on the US 10-year Treasury fell to 4.49%, while gold has slipped below $4,100 an ounce. Brent Crude moved down to $76 per barrel on expectations of smoother crude flows via Hormuz.
The European Commission’s fiscal monitoring regime has passed a key test — granting limited budget room to indebted governments (including Italy) without rattling sovereign bond markets or ratings agencies.
