FTSE 100 edges higher as traders eye EU summit and Netflix impact on tech stocks
The FTSE-100 Index was set to rise modestly today as investors juggle with a mixed picture on the global economy and a sharp decline in Netflix shares.
The US tech giant warned that the astonishing levels of growth it has enjoyed during the peak covid months cannot last forever and its third quarter forecasts fell short of investors’ expectations. The shares sold off heavily in after-hours trading and some fund managers expect the news to add a dose of realism to the whole tech sector today.
Tech stocks have driven the Nasdaq index to record highs during recent weeks but it has trailed other equity benchmarks this past week, highlighting something of a dimming of confidence levels and perhaps foreshadowing the Netflix reset.
Some traders said that could follow through into UK tech hopefuls such as Ocado which have also boomed through covid.
The FTSE-100 was priced to open 16 points higher at 6266 by CMC Markets, while the DAX 30 in Germany was called up 24 at 12898 and France’s CAC 40 up 7 at 5092.
Investors will be eying the EU summit today as the bloc’s leaders attempt to thrash out a solution to the splits over whether taxpayers should stump up for a e750 billion rescue fund for regions hit hardest by covid. The Netherlands, Sweden, Denmark and Austria are opposing putting their hands in their pockets to help out those whose populations and economies were most badly scarred such as Italy and Spain.
Last night saw US shares taper downwards, pushing investors into the dollar although CMC sees support levels for the pound at around $1.2421 should it track lower today. If it gains, CMC expects it to find resistance at $1.2696 to the pound.
The US economy clearly seems to be rebounding from the covid hibernation. Retail sales data yesterday came out higher than forecast despite some states pausing their reopenings. Manufacturing had a tougher time though. Nevertheless the OPEC+ oil cartel is likely ease back on its planned cuts to output as demand is expected gently to rise.Around 400,000 Americans laid off in the crisis went back to work according to yesterday’s jobs data.
Asian stocks are having a mixed session today with China’s index first rising but then falling back into negative territory.
