Morning Spread

Morning Spread

Friday 11th April 2014
IndexLevelChg (%)
UK Market6571.62-1.06
Dow Indust Avg16170.22-1.62
S&P 5001833.08-2.09
Nasdaq Composite4054.11-3.10
Nikkei 22513960.05-2.38
Hang Seng23003.64-0.79
IndexLevelChg (%)
Nymex 1m103.16-0.25
Gold Spot1316.29-0.19
GBP/USD1.678-0.02
GBP/EUR1.2076+0.07
EUR/USD1.3895+0.06
USD/JPY101.75+0.28

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%.