Netflix and Tesla shares fall, FTSE 100 flat
Wall Street’s tech sector is under pressure after updates from Netflix and Tesla left their shares sharply lower in trades after last night’s closing bell.
The electric car maker fell 4% despite a 47% jump in revenue in the second quarter as investors focused on the outlook for lower margins.
Streaming giant Netflix missed sales estimates for the quarter and gave a weaker-than-expected forecast for the current period, sending its shares down 8%.
The updates left futures markets in the United States pointing lower after yesterday’s positive session, when the S&P 500 index rose for the third day in a row to set a new 15-month high.
London stocks posted the strongest performance on Wednesday after interest rate expectations were revised down following weaker inflation of 7.9% in June.
A weaker pound helped the FTSE 100 index rise 1.8% to 7,588, while the UK-focused FTSE 250 jumped 3.8%. Today’s session is likely to be less interesting, with the IG Index predicting a flat start for the FTSE 100.
Easyjet’s earnings beat expectations as it seeks to expand its aircraft fleet
Easyjet is gearing up to expand its aircraft fleet to drive future growth as it recorded a better-than-expected profit increase.
The airline said it currently has 163 aircraft on order for delivery through 2028, but is “now leading a process to secure additional firm order positions for our longer-term fleet plan”.
Pre-tax profits reached £203million in the three months to the end of June, leading to a loss of £114million the previous year and well beating City expectations of around £160million.
Revenue rose 34% to £2.36billion, while annual profits were on course for a new record high.
Morning refreshment: what you need to know to start the day
Hello from the municipal office of the Evening Standard.
Tesla shares fell about 4% in aftermarket trading overnight after profitability slipped in the second quarter and investors braced for further declines after Elon Musk said he expected to continue to cut prices for electric vehicles if rising interest rates persist.
But Musk insisted the drop in profits was a blow and the company could one day grow to up to ten times its current size.
Here is a summary of our main headlines from yesterday:
Inflation fell more than expected in June, dropping below 8% for the first time in a year. City analysts lowered their bets on interest rate spikes and the pound fell against the dollar as a result.
One of the biggest technology deals in history, between Broadcom and VMware, has received the provisional green light from the British competition regulator.
Jaguar Land Rover owner Tata has confirmed speculation it is planning a new battery gigafactory in Somerset after announcing a £4billion investment.
This morning we are also expecting trade updates from airline easyjet, winemaker Chapel Down and international defense firm Babcock. In the afternoon, we’ll report on earnings figures from private equity giant Blackstone and pharmaceutical company Johnson & Johnson.