FTSE 100 live: Blue-chip index lower as election campaigning hots up

The latest updates on the FTSE 100 and London’s financial markets from City A.M.’s newsroom in the heart of the City of London.

The Nasdaq Composite saw its largest drop in almost two months, primarily due to a sell-off led by Nvidia and other major tech stocks, which countered gains in the broader US stock market. 

Overnight, the S&P 500 fell by 0.29 per cent, ending the day at 5,448.89 points, while the Nasdaq Composite decreased by 1.09 per cent to close at 17,499.17. Conversely, the Dow Jones Industrial Average rose by 0.66 per cent, reaching 39,408.32.  

Within the S&P 500’s 11 sectors, only technology and consumer discretionary saw declines, whereas the energy sector led the gains with a 2.73 per cent increase. 

Nvidia dropped 6.68 per cent for the third consecutive session, with analysts pointing to profit-taking after its rapid rise last week, which had made it the world’s most valuable company.  

Other semiconductor stocks such as Taiwan Semiconductor Manufacturing, Broadcom, Marvell Technology, and Qualcomm saw declines ranging from 3.53 per cent to 5.7 per cent, causing the chip stocks index to fall by 3.02 per cent. 

In Asian markets, Japan’s Nikkei 225 climbed 0.5 per cent, while Chinese stocks had modest gains; blue chips edged up by 0.1 per cent, and Hong Kong’s Hang Seng index increased by 0.9 per cent.  

The Topix index in Japan rose by 1.3 per cent, with robotics company Keyence, up by 0.9 per cent, making a significant contribution due to its large market capitalization.  

Taiwan’s Taiex index fell by 1.2 per cent, following a 1.1 per cent drop in the Nasdaq Composite on Monday, with Taiwan Semiconductor Manufacturing Company, the world’s largest chip producer, slipping by 1.1 per cent. 

Futures for the S&P 500 and Nasdaq remained unchanged. In Europe, EURO STOXX 50 futures rose slightly by 0.04 per cent. The FTSE 100 finished Monday up by 0.5 per cent, but its futures indicated a weak start for Tuesday, decreasing by 0.22 per cent to 8,327.5 points. 

In commodities, oil prices were stable. Brent crude held at $85.95 per barrel, and US crude remained around $81.60 per barrel. Gold prices fell by 0.3 per cent to $2,325.52 per ounce. 

On Monday, China’s yuan fell to a seven-month low against the dollar, nearing its official policy band limit. The drop was due to the dollar’s strength and a weakening yen. This decline signals significant capital outflows to Hong Kong, reflecting cautious sentiment among domestic investors amid market uncertainties. 

Roaring Kitty saw losses as GameStop shares briefly dropped below his purchase price of $23.4135 for a 2.1 per cent stake. His return to social media discussions last month initially boosted the stock. 

Japanese Chief Cabinet Secretary Yoshimasa Hayashi addressed concerns about the yen nearing 160 per dollar, stating the government is ready to manage currency fluctuations to protect economic stability for businesses and households. 

This week, investors are focused on Friday’s US PCE price index report, the Fed’s preferred inflation gauge, expected to show easing price pressures.  

Markets anticipate around two rate cuts this year, with a 61 per cent chance of a 25-basis-point reduction in September, and the Fed’s latest projection hints at a possible rate cut in December. 

Key data releases this week also include durable goods orders, weekly jobless claims, final first-quarter GDP figures, and the annual Russell Index reconstitution. Several quarterly earnings reports are also on the docket. 

On Thursday, President Joe Biden and Republican rival Donald Trump will debate in Atlanta, an event that could impact the tight race for the November election, according to recent polls. 

Investors will be paying attention to comments from Federal Reserve governors Michelle Bowman and Lisa Cook, as well as the Conference Board’s consumer confidence index for June. 

In the UK, there are no major economic reports scheduled for release this week, while market caution is increasing as the British parliamentary election approaches in less than two weeks.