It has been an eventful week for the technology sector and the US market was notably weak on Thursday with a major sell off in the NASDAQ index, the sharpest since 2011. Major fallers included Facebook down 5.2%, LinkedIn lost 3.5% and Google was down 4.1%. The issue seems to be the very high valuation levels combined with early evidence that the rapid earnings growth in the sector is beginning to slow. The retailer, Bed Bath & Beyond was down just over 6% on a profit warning. Financials were poor with American Express declining 3.78%, JP Morgan fell 3.1% and Bank of America was down 3%. McDonalds was one of the few stocks to rise, the shares were up 1.1% to reach the highest level since July 2013.
Asia was also down overnight with falls experienced across the region, Tencent, China’s biggest internet company lost over 6% on the sector rout. Samsung Electronics was down 1.1%, Yahoo Japan fell 2.1% and Softbank dropped 3.8%. It was an awful week for Japanese retailer, Fast Retailing, falling nearly 15% on rising costs and weakening domestic demand. In Australia, the drinks company, Coca Cola Amatil suffered the biggest fall in the stock for 23 years, down 15% on weak sales in Australia and rising costs in Indonesia.
Europe is weaker in early trading on Friday, marking a volatile week for the equity markets. In France, the defence giant, Thales, is down 4% after a disappointing investor day. JP Morgan have downgraded the stock with earnings forecasts reduced by 10% for both 2016 and 2017. Other fallers include Roche down 2%, Airbus down 1.4% and Kuehne/Nagel is down 1.5%. In the UK, there are further signs of profit taking in previous strong performers. ARM Holdings is down 4.23%, Barratt Developments is 3.16% lower and Sage Group is down 2.7%.
Morning Spread 8th March 2017 European shares traded flat this morning, the modest moves masking significant results driven games by several companies on a bust day for European earnings.
Morning Spread 2nd November 2016 Asian stocks followed global equities lower despite gauges of manufacturing in China topping estimates and the Bank of Japan maintained its record stimulus program.
Morning Spread 1st November 2016 Asian stocks were mixed as declines in oil prices dragged energy shares lower and investor anxiety grew over next week’s US presidential election.
Morning Spread 28th October 2016 Asian stocks fell as oil explorers pushed down Hong Kong gauges, while investors digested earnings from several companies.
Morning Spread 27th October 2016 US stocks were mixed following the release of earnings from several companies.
Morning Spread 24th October 2016 US stocks were little changed as a record day for Microsoft and earnings from McDonald’s helped offset a fall in energy and healthcare shares.
Morning Spread 19th October 2016 Asian shares rose as a barrage of Chinese data confirmed the economy had stabilised on the back of government spending and a hot housing market, even if worries about debt continue to mount.
Morning Spread 10th October 2016 Asian stocks were mixed following the second US presidential debate between Hilary Clinton and Donald Trump.
Morning Spread 5th October 2016 Most Asian stocks outside Japan slid on concern central banks will reduce stimulus, while the Nikkei climbed after the yen weakened.
Morning Spread 27th September 2016 Asian stocks advanced with investors viewing Democratic candidate Hillary Clinton as having gotten the upper hand in the first US presidential debate.