ADVFN UK Market News

Category: Top Story

  • Wall Street futures point lower as AI concerns pressure technology shares: Dow Jones, S&P, Nasdaq

    Wall Street futures point lower as AI concerns pressure technology shares: Dow Jones, S&P, Nasdaq

    Tech stocks expected to lead declines at the open

    U.S. equity futures traded lower on Tuesday, indicating a weaker start for Wall Street as investors looked set to trim exposure following Monday’s rally. Technology shares were expected to be the main drag after renewed concerns about artificial intelligence spending weighed on the semiconductor sector.

    Samsung sell-off sparks broader chip weakness

    Market sentiment deteriorated after South Korean chipmaker Samsung Electronics suffered a near 7% decline despite reporting a 19-fold increase in second-quarter operating profit.

    The market reaction suggested investors remain cautious about whether the rapid pace of AI-related investment can be maintained.

    “Although Samsung’s results were stellar, investors are getting nervous about the scale of money ploughing into AI and whether it’s a bubble waiting to burst,” said Dan Coatsworth, head of markets at AJ Bell.

    Chip stocks also faced fresh pressure after Reuters reported that Chinese AI startup DeepSeek is working on its own artificial intelligence processor, potentially reducing future dependence on established chip suppliers.

    Strong finish on Monday

    Wall Street ended Monday’s session with broad-based gains following the Independence Day holiday.

    The Nasdaq Composite rose 288.49 points, or 1.1%, to 26,121.16, while the S&P 500 gained 54.19 points, or 0.7%, to finish at 7,537.43. The Dow Jones Industrial Average added 155.84 points, or 0.3%, ending at a record closing high of 53,055.91.

    Hardware stocks led the rally

    Technology companies drove most of Monday’s advance, with computer hardware names posting the strongest gains.

    The NYSE Arca Computer Hardware Index climbed 3.4%, helped by a 4.4% rise in Dell Technologies (NYSE:DELL) after President Donald Trump highlighted the company’s computers during an Oval Office event.

    The NYSE Arca Networking Index gained 2.8%, while the Philadelphia Semiconductor Index advanced 2.2%.

    Elsewhere, brokerage firms, banks and steel producers also moved higher, while pharmaceutical, telecommunications, housing and utility stocks lagged the broader market.

    Services activity remains in expansion territory

    Economic data showed the U.S. services sector continued to grow in June, although at a slightly slower pace.

    The Institute for Supply Management reported its Services PMI eased to 54.0 from 54.5 in May, matching market expectations. Any reading above 50 signals continued expansion.

  • European shares trade mixed as investors lock in gains and geopolitical tensions return: DAX, CAC, FTSE100

    European shares trade mixed as investors lock in gains and geopolitical tensions return: DAX, CAC, FTSE100

    European markets delivered a mixed performance on Tuesday as investors took profits in technology stocks following recent gains, while renewed geopolitical concerns weighed on sentiment after reports that two commercial vessels were struck by Iranian missiles in the Strait of Hormuz, lifting both oil prices and government bond yields.

    Germany’s industrial output beats expectations

    Economic data released by Destatis showed Germany’s industrial production rose more strongly than forecast in May.

    Industrial output increased 0.9% month-on-month, accelerating from April’s revised 0.2% gain. It marked the strongest monthly expansion since September.

    Compared with the same month last year, industrial production was unchanged after declining 0.9% in April.

    UK housing market returns to growth

    In the UK, the latest Halifax survey compiled by S&P Global showed house prices rose for the first time in four months during June.

    Average house prices increased 0.2% month-on-month, reversing the 0.2% decline recorded in May and exceeding economists’ expectations for a 0.1% increase.

    European indices move in different directions

    Germany’s DAX declined 0.5%, while France’s CAC 40 gained 0.3%. The UK’s FTSE 100 outperformed, rising 0.6%.

    Technology shares remained under pressure as investors reassessed valuations following the sector’s strong AI-driven rally. Infineon Technologies (TG:IFX) dropped 5.4%, while ASML Holding (EU:ASML) lost 5.1%.

    Company movers

    Victrex (LSE:VCT) surged 19% after reaffirming its full-year guidance and reporting stronger-than-expected third-quarter revenue growth.

    Halma (LSE:HLMA) slipped more than 1% after announcing the acquisition of French automated tissue sample management specialist Dreampath Diagnostics.

    Shell (LSE:SHEL) advanced 3% after improving its second-quarter outlook for liquefied natural gas (LNG) production.

    Keller Group (LSE:KLR) climbed 21% to a record high after upgrading its full-year earnings guidance.

  • ITV drops as J.P. Morgan downgrades stock after Sky deal terms disappoint (ITV)

    ITV drops as J.P. Morgan downgrades stock after Sky deal terms disappoint (ITV)

    ITV (LSE:ITV) shares fell more than 6% on Tuesday after J.P. Morgan Cazenove downgraded the broadcaster to “neutral” from “overweight” and reduced its price target to 85 pence from 104 pence, arguing that the company had not achieved the valuation it had hoped for in the sale of its Media & Entertainment division to Sky.

    ITV confirmed the disposal of the M&E business for up to £1.6 billion. The consideration includes £1.2 billion in cash, £200 million linked to the contribution of Love Productions and a further £200 million in contingent cash tied to ITV’s 2027 advertising revenue. Based on a headline valuation of £1.4 billion to £1.6 billion, Sky is paying around 5.6 to 6.4 times EBITDA.

    “In our view, Sky is paying fair value for M&E with Sky keeping all of the upside from cost savings, synergies and strategic benefits, while ITV is bearing separation / deal costs of c£150m and stranded Studios costs of c £30m,” the broker said.

    Separation costs weigh on proceeds

    ITV will also transfer its sports production business to Sky, representing around £50 million of revenue and £5 million to £6 million of EBITA.

    J.P. Morgan noted that net advertising revenue growth is expected to reach 8% in the second quarter, below guidance of 10%, which the broker said was “likely not helped by UK political uncertainty and 3 months of conflict in the Middle East.”

    The bank estimates ITV will receive net cash proceeds of about £1.05 billion from the £1.2 billion cash payment after roughly £150 million of post-tax separation costs. ITV plans to return £950 million to shareholders, equivalent to 25 pence per share.

    Following the deal, the remaining ITV Studios business is expected to carry net debt of 1.5 times EBITDA, with ITV aiming to retain its investment-grade status.

    Regulatory approval still required

    The transaction remains subject to regulatory approval. J.P. Morgan said Sky would control about 70% of the television advertising market after the acquisition, although it would represent only around 7% of the broader advertising market.

    The broker warned that if the UK’s Competition and Markets Authority adopts a narrow definition of the television advertising market, it could require structural or behavioural remedies before clearing the deal.

    ITV Studios becomes the focus

    Following the transaction and the inclusion of Love Productions, ITV Studios is expected to generate pro forma revenue of around £2.1 billion, EBITDA of £330 million and EBITA of £300 million.

    The remaining Studios business will also enter a long-term content supply agreement with ITV M&E and Sky, including a minimum spending commitment of £2.1 billion between 2028 and 2032.

    At ITV’s current share price, J.P. Morgan estimates the implied enterprise value of ITV Studios at about £2.6 billion, equivalent to 7.8 times EBITDA.

    “ITV has not been able to secure the deal that we had hoped for – not helped by the ongoing UK and global political / macro uncertainty over the past 6 months (and indeed the last 10 years since Brexit),” the broker said. “Our PT falls from 104p to 85p – with the 19p downgrade reflecting the lower disposal price, separation costs and stranded Studios costs..”

    J.P. Morgan’s revised 85 pence price target is based on a discounted cash flow model using an 11.4% weighted average cost of capital and a 0% terminal growth rate.

  • US futures ease as investors digest Samsung earnings and Fed signals: Dow Jones, S&P, Nasdaq, Wall Street

    US futures ease as investors digest Samsung earnings and Fed signals: Dow Jones, S&P, Nasdaq, Wall Street

    US equity futures traded slightly lower on Tuesday after the Dow Jones Industrial Average reached another record high in the previous session, with investors assessing Samsung Electronics’ (USOTC:SSNHZ) blockbuster earnings, fresh remarks from Federal Reserve Governor Christopher Waller and renewed geopolitical tensions in the Middle East.

    Markets pause after record Wall Street close

    As of 03:02 ET (07:02 GMT), Dow Jones futures were little changed, while S&P 500 futures slipped 0.2% and Nasdaq 100 futures fell 0.8%.

    Wall Street ended Monday on a positive note, with the Dow closing above the 53,000 mark for the first time. Technology stocks led the gains, particularly semiconductor names such as Advanced Micro Devices (NASDAQ:AMD) and Western Digital (NASDAQ:WDC). Broadcom (NASDAQ:AVGO) also advanced after announcing a custom chip partnership with Apple, helping the Philadelphia Semiconductor Index recover from last week’s losses.

    Despite the strong headline performance, Deutsche Bank cautioned that market breadth remained weak.

    “On paper the headlines were pretty decent,” analysts led by Jim Reid wrote. “But under the surface, things weren’t quite as robust as they seemed.”

    Samsung delivers record profit but shares retreat

    Samsung Electronics reported preliminary second-quarter operating profit of 89.4 trillion won, or approximately US$58 billion, nearly twenty times higher than the same period last year and above market expectations. Revenue is forecast to reach 171 trillion won.

    Even so, Samsung’s shares dropped more than 6% in Seoul as investors questioned whether current valuations across the AI semiconductor sector have become too demanding.

    Fed keeps inflation firmly in focus

    Investors also weighed comments from Federal Reserve Governor Christopher Waller, who warned that inflation risks have become a greater concern than labour market weakness.

    Waller said employment conditions have stabilised while inflation is “taking off,” reiterating that the Federal Reserve’s 2% inflation objective remains essential and will not be compromised.

    Banks reportedly consider payments network acquisition

    The Wall Street Journal reported that JPMorgan Chase (NYSE:JPM), Bank of America (NYSE:BAC), Wells Fargo (NYSE:WFC) and PNC Financial Services (NYSE:PNC) have discussed acquiring one of Fiserv’s (NASDAQ:FISV) debit payment networks.

    According to the report, ownership of a payments network could help banks reduce the impact of federal interchange fee restrictions, although discussions remain preliminary and no transaction is considered imminent.

    Strait of Hormuz tensions intensify

    Geopolitical concerns also remained elevated after Axios reported that Iran launched missiles at commercial vessels in the Strait of Hormuz, ending a week-long pause in attacks.

    Separately, UK Maritime Trade Operations said a tanker near the Omani coast had been struck by an unidentified projectile, causing a fire. The incidents followed unsuccessful indirect talks between Washington and Tehran over security in the strategic waterway.

  • European shares trade sideways as AI concerns weigh on technology sector: DAX, CAC, FTSE100

    European shares trade sideways as AI concerns weigh on technology sector: DAX, CAC, FTSE100

    European equity markets were little changed on Tuesday as investors adopted a cautious stance towards technology stocks amid growing concerns over valuations linked to the artificial intelligence boom, while attention also turned to the NATO summit in Turkey for potential defence spending announcements.

    The pan-European STOXX 600 index was broadly unchanged at 650.84 points by 07:13 GMT after ending the previous session just below record highs.

    Technology stocks lead market declines

    Technology shares were the weakest performers, with the sector falling 1.6% as semiconductor companies extended the global selloff triggered by concerns that the recent rally in AI-related stocks may have become overstretched.

    Chip equipment manufacturer ASML (EU:ASML) and semiconductor producer Infineon (TG:IFX) both declined around 4%.

    Siemens Energy (TG:SIE) also came under pressure, falling 5.5% after Barclays downgraded the stock to “underweight” from “equal-weight.”

    The weakness followed a negative session in Asia, where Samsung Electronics (USOTC:SSNHZ) shares fell despite issuing strong earnings guidance, while Nasdaq futures were also trading nearly 1% lower, reflecting broader caution towards technology shares.

    Defence companies remain in focus

    In contrast, European defence stocks edged higher as investors monitored the NATO summit in Turkey, where member states were expected to announce new defence agreements in response to continued pressure from the United States to increase military spending across Europe.

    The defence sector has been the strongest performer within the STOXX 600 so far this month.

    Swedish defence manufacturer Saab (TG:SDV1) gained 5.3% after Morgan Stanley upgraded the stock to “overweight” from “underweight.”

    Shell advances after guidance update

    Elsewhere, Shell (LSE:SHEL) rose 2.2% after the energy group modestly increased its outlook for integrated gas production during the second quarter.

  • Market Open: Shell Q2 Trading Update, Capita Pension Administration

    Market Open: Shell Q2 Trading Update, Capita Pension Administration

    FTSE 100 opens steady as Shell upgrades second-quarter trading outlook, Capita addresses pension concerns and Brent crude edges lower.

    Market Overview

    The FTSE 100 opened broadly unchanged at 10,651.30, while the Euronext 100 edged 0.07 per cent higher and Germany’s DAX slipped 0.21 per cent at the open. Overnight, the Nasdaq closed higher at 26,121.16 and the S&P 500 gained to 7,537.43 as investors balanced improving UK housing data, the start of the NATO summit and expectations for upcoming Federal Reserve policy signals.

    Commodity markets were mixed, with copper, gold, Brent crude and natural gas all trading lower at the open, while Bitcoin fell against sterling. Sterling was broadly steady against the major currencies as oil markets continued to weigh renewed Strait of Hormuz security concerns against Saudi price cuts and higher OPEC+ supply expectations.

    Market Numbers

    FTSE 100: Down (-0.00%), 10,651.30

    Euronext 100: Up (+0.07%), 1,935.63

    DAX: Down (-0.21%), 25,764.94

    NASDAQ: Up, 26,121.16

    S&P 500: Up, 7,537.43

    In the Headlines

    Trading Update – Shell (LSE:SHEL)

    Shell said second-quarter trading and refining performance is expected to be stronger than previously guided, signalling resilient earnings despite ongoing volatility across global energy markets. The update may support investor confidence ahead of the company’s full quarterly results.

    Pension Administration – Capita (LSE:CPI)

    Capita responded to concerns surrounding its administration of the Civil Service Pension Scheme, seeking to reassure stakeholders over service delivery and operational performance. The update is relevant as investors continue to monitor execution and contract quality across the outsourcing business.

    Currencies (vs GBP)

    USD: Down (-0.00%), $1.3394

    CHF: Up (+0.00%), Fr.1.0784

    EUR: Up (+0.00%), €1.1707

    JPY: Up (+0.00%), ¥217.113

    AUD: Down (-0.03%), $1.9259

    Bitcoin (BTC/GBP): Down, £47,131.58

    Commodities

    Copper: Down

    Gold: Down

    Brent Crude: Down

    Natural Gas: Down

  • FTSE 100 rises as UK house prices recover and investors monitor NATO summit

    FTSE 100 rises as UK house prices recover and investors monitor NATO summit

    The FTSE 100 traded higher on Tuesday, recovering from the previous session’s losses as investors welcomed an improvement in UK house prices while closely following developments at the NATO summit in Ankara and ongoing tensions in the Middle East.

    The UK’s benchmark index gained 0.25% after Monday’s 0.3% decline. Elsewhere in Europe, Germany’s DAX slipped 0.22%, while France’s CAC 40 advanced 0.58%. Sterling edged 0.07% lower against the US dollar to 1.3379.

    Fresh housing data showed the UK property market returned to growth in June, with the Lloyds House Price Index recording a 0.2% monthly increase. The average home price rose to £299,330 from £298,812 in May, while annual house price growth edged up to 0.6% from 0.5%. Northern Ireland remained the strongest-performing region, posting annual growth of 7.4%, whereas London recorded a 1.1% year-on-year decline, leaving the average property price at £534,831.

    Commenting on the market, Amanda Bryden, Head of Mortgages at Lloyds, said:

    “Mortgage rates have eased from their recent highs, offering some encouragement to those considering a move.”

    She added:

    “The outlook for house prices will depend largely on inflation continuing to ease and household confidence gradually improving.”

    Meanwhile, geopolitical risks remained firmly in focus after a tanker caught fire in the Strait of Hormuz following a reported projectile strike, marking the latest disruption to commercial shipping since the outbreak of the conflict between the United States and Iran.

    Diplomatic negotiations between Washington and Tehran remained suspended during the funeral period for Iran’s Supreme Leader, Ali Khamenei. Speaking at the White House before departing for Ankara, US President Donald Trump said the United States would prevail in the conflict “one way or the other,” adding that Washington could destroy Iran’s electricity infrastructure in the “small part of an afternoon.”

    Attention also turned to the two-day NATO summit in Ankara, where alliance leaders are expected to discuss plans to implement last year’s commitment to increase defence spending from 2% to 3.5% of GDP by 2035. The meeting coincides with a major defence industry exhibition aimed at securing multi-billion-dollar procurement agreements, while President Trump is also expected to hold bilateral talks with the presidents of Ukraine and Syria.

    In commodity markets, Brent crude climbed 1.28% to $72.91 a barrel and US West Texas Intermediate crude gained 1.20% to $69.37. Gold prices moved lower, with futures falling 0.63% to $4,141.31 an ounce and spot gold declining 0.84% to $4,129.42.

    UK corporate highlights

    Shell (LSE:SHEL) increased its guidance for second-quarter integrated gas production, although it cautioned that output will remain well below first-quarter levels following the shutdown of its Pearl GTL facility in Qatar after the Ras Laffan attack.

    HSBC (LSE:HSBA) is scaling back higher-risk private credit lending in favour of lower-risk funds, according to a Financial Times report, as concerns grow over underwriting standards in the private credit market.

  • Young’s reports strong start to the year as sporting events and sunshine lift trading (YNGA)

    Young’s reports strong start to the year as sporting events and sunshine lift trading (YNGA)

    Young’s (LSE:YNGA) has reported a strong opening to its new financial year, with favourable weather and a packed summer sporting calendar helping to drive higher sales despite ongoing pressures across the hospitality sector.

    The London and south-east-focused pub and hotel operator said total revenue increased by 9.4% during the 14 weeks to 31 March compared with the same period last year. On a like-for-like basis, which excludes the contribution from newly acquired venues, sales rose by 5.5%.

    The company said trading was particularly strong over the late May bank holiday weekend, describing performance as “exceptional”, especially at pubs with outdoor gardens and riverside locations that benefited from the warm weather.

    Young’s also pointed to increased customer demand generated by the FIFA World Cup, with England’s progress in the tournament encouraging higher footfall. Extended licensing hours for later evening matches allowed a number of venues to remain open into the night for supporters. The Wimbledon Championships also contributed to trading, with the group operating several pubs close to the tournament.

    Chief executive Simon Dodd said the business had made a positive start to the financial year.

    “This was supported by favourable weather, a busy summer of sport, with England’s success in the World Cup so far, a welcome boost and contributions from our expanded estate, as we integrate the Cubitt House pubs.”

    Young’s recently completed the acquisition of eight gastropubs and pubs with rooms from Cubitt House London Pubs, further expanding its portfolio.

    Commenting on the outlook, Dodd added:

    “While the backdrop remains challenging, we are well-positioned and looking ahead to the rest of the year with confidence.”

    The wider hospitality sector continues to face rising operating costs, with businesses citing increases in the National Living Wage, higher employer National Insurance contributions, additional regulatory costs and renewed pressure from higher energy prices.

    The chief executive of rival pub operator Fuller’s recently criticised what he described as “government interference, additional taxes and regulations”, warning that rising costs “come with consequences” including pub closures and fewer employment opportunities.

    More about Young’s

    Young & Co.’s Brewery PLC is a premium pub, hotel and hospitality operator focused primarily on London and the south-east of England. The company owns and operates a portfolio of traditional pubs, gastropubs and boutique hotels, with a strategy centred on premium food, drink and accommodation offerings in high-quality locations. Recent acquisitions, including the Cubitt House estate, form part of Young’s long-term expansion strategy.

  • Keller upgrades 2026 expectations as record order book supports growth (KLR)

    Keller upgrades 2026 expectations as record order book supports growth (KLR)

    Keller Group plc (LSE:KLR) has raised its outlook for 2026 ahead of publishing its interim results, citing stronger-than-expected trading across the business, led by exceptional performance in North America. Demand for infrastructure and data centre projects in the United States and Canada has continued to accelerate, driving record activity levels and offsetting weaker conditions in the south Florida residential market.

    The group’s Europe and Middle East division also delivered a solid performance, with strong trading in Scandinavia, Central Europe and the Middle East compensating for softer markets in western Europe. In Asia Pacific, trading remained broadly in line with expectations as strong results from Austral balanced pricing pressures affecting the Australian foundations business. Supported by robust tendering activity and a record order book of approximately £1.9 billion, the Board now expects both full-year revenue and underlying operating profit for 2026 to come in materially ahead of current market forecasts, reflecting confidence in the group’s growth strategy and long-term prospects.

    Keller’s outlook continues to be supported by improving financial performance and an attractive valuation, with a relatively low price-to-earnings ratio. Recent management commentary has also highlighted strong free cash flow generation, a net cash balance sheet and enhanced returns to shareholders. Technical indicators remain positive, although elevated RSI and stochastic readings suggest the shares could be vulnerable to a short-term pullback after their recent gains.

    More about Keller Group plc

    Keller Group plc is the world’s largest geotechnical engineering contractor, specialising in advanced foundation engineering and ground improvement solutions for the global construction industry. The company employs around 10,000 people across five continents and completes approximately 5,500 projects each year, generating annual revenue of around £3 billion from infrastructure, commercial and large-scale construction developments.

    North America is Keller’s largest market, contributing around 60% of group revenue, with continued investment in infrastructure and data centre construction providing significant growth opportunities. The company’s diversified international operations and expertise in complex engineering projects underpin its long-term strategy for sustainable growth in geotechnical services.

  • Capita addresses concerns over Civil Service Pension Scheme administration (CPI)

    Capita addresses concerns over Civil Service Pension Scheme administration (CPI)

    Capita (LSE:CPI) has responded to criticism of its administration of the Civil Service Pension Scheme following a statement from the Paymaster General, acknowledging that service standards have fallen below expectations. The company said performance has been particularly disappointing in handling bereavement, retirement and pension quotation cases, and apologised to affected scheme members for the disruption and distress caused.

    The outsourcing group said it is working closely with the Cabinet Office to improve operations and resolve outstanding issues as quickly as possible. According to Capita, new processes and automation have already been introduced to help reduce the backlog and improve service delivery. The company is reviewing the implications of the ministerial statement and said it will provide a further market update if necessary. It also confirmed that a scheduled trading update later this week will outline progress against its wider strategic objectives.

    Capita’s outlook continues to be affected by weak financial performance, including losses during 2025, pressure on margins, inconsistent and negative free cash flow, and a highly leveraged balance sheet with limited equity. These factors are partly offset by positive technical indicators, with the shares trading above key moving averages and maintaining strong momentum, although overbought signals suggest there may be increased risk of a short-term pullback. Valuation remains challenging due to ongoing losses and the absence of a dividend.

    More about Capita plc

    Capita plc is a UK-listed outsourcing and business services company that provides technology-enabled services to organisations across the public and private sectors. Operating in eight countries, with a primary focus on the UK and Europe, the company helps clients manage complex operational processes while improving customer and citizen experiences.

    Its services span areas including government administration, customer management, digital transformation and business process outsourcing, supporting millions of people through essential public and commercial services.