London (AFP) – Global stock markets diverged on Thursday as investors assessed the latest corporate earnings, with tech firms back under pressure, while awaiting developments over a potential US-Iran deal to reopen the Strait of Hormuz. Oil prices edged higher as investors sought confirmation that a deal was progressing. London, Paris, and Frankfurt stock markets were all higher nearing midday.
Alcoholic drinks maker Diageo jumped seven percent to top London’s FTSE 100 index as it unveiled a major cost-cutting plan to help reverse sliding profit. Shares in industrial giant Siemens fell five percent in Frankfurt after its forecasts fell short of investors’ hopes. In Asia, tech-heavy indices were weighed down by concerns over the profitability of AI investments following disappointing earnings from US giants SanDisk and Western Digital. A sharp decline in shares of Elon Musk’s SpaceX on Wednesday also soured the mood after its earnings results raised worries about huge AI spending. Tech stocks had staged a rally earlier this week, after a month-long rout that slashed billions of dollars off valuations.
Seoul — the poster child of the sell-off since June — shed more than four percent on Thursday, led by a 10 percent plunge in SK hynix and Samsung’s loss of more than six percent. Tokyo’s Nikkei — another tech-heavy index — lost nearly one percent, with chipmaker Kioxia down more than 10 percent and Tokyo Electron more than five percent lower. There was also selling in Hong Kong, Wellington, Manila, and Taipei, although Shanghai, Sydney, and Singapore rose.
Easing tensions in the Middle East and a potential US-Iran deal to reopen the Strait of Hormuz have helped keep a lid on oil prices and tempered inflation and rate hike concerns. Iran said Wednesday it had agreed on a route with Oman for ships transiting the waterway and were adding the final touches to arrangements for jointly managing it. Official sources briefing Iranian media stressed that any reopening would depend on the United States fulfilling what Tehran sees as its commitment to end its own naval blockade of Iran’s ports.
“Caution in the oil price today is a sign that the market needs confirmation from the White House that this is all true, and the prospects of a deal to reopen the Strait of Hormuz is not a false dawn,” said Kathleen Brooks, research director at traders XTB. Investors are keenly awaiting the release of key US jobs data on Friday, hoping for an idea about the state of the economy as the Federal Reserve plots its next moves on borrowing costs. Figures on Wednesday showed hiring in the US private sector was significantly below expectations in July, with industries such as leisure and hospitality shedding jobs.
Key figures around 1115 GMT:
– London – FTSE 100: UP 0.1 percent at 10,900.17 points
– Paris – CAC 40: UP 0.6 percent at 8,719.75
– Frankfurt – DAX: UP 0.3 percent at 26,202.13
– Tokyo – Nikkei 225: DOWN 0.9 percent at 65,683.26 (close)
– Hong Kong – Hang Seng Index: DOWN 1.5 percent at 25,530.28 (close)
– Shanghai – Composite: UP 0.6 percent at 3,900.35 (close)
– Seoul – Kospi: DOWN 4.6 percent at 6,296.38 (close)
– New York – DOW: UP 0.5 percent at 54,349.12 (close)
Currencies:
– Dollar/yen: UP at 157.92 yen from 157.79 yen on Wednesday
– Euro/dollar: DOWN at $1.1544 from $1.1549
– Pound/dollar: UP at $1.3465 from $1.3463
– Euro/pound: DOWN at 85.75 pence from 85.78 pence
Oil prices:
– Brent North Sea Crude: UP 1.1 percent at $80.33 per barrel
– West Texas Intermediate: UP 0.9 percent at $75.93 per barrel
© 2024 AFP
