Market report

IMF follows World Bank and cuts growth forecast


5pm: London weaker

The FTSE 100 index closed slightly weaker, down 15.1 points at 7601.28 after the IMF followed the World Bank yesterday in downgrading its outlook for the global economy.

Michael Hewson, chief market analyst at CMC Markets (UK) commented: “The IMF reduced its global GDP outlook to 3.6%, from 4.4%, while upgrading its inflation outlook to 5.7% in advanced economies.”

In early Wall Street exchanges the Dow Jones Industrial Average was up 1.1% and the S&P 500 1.3% while the tech-laden Nasdaq index was 1.6% higher.

In the FTSE 100, oil majors Shell and BP ended up 1.6% and 0.4% respectively, tracking spot oil prices higher.

Brent oil was quoted at $107.80 a barrel at the London equities close, marginally up from $107.52 at the same time on Thursday, ahead of the Easter weekend.

ITV closed down 3.6% after Berenberg downgraded the broadcaster to ‘sell’ from ‘hold’.

Global markets

Brent crude oil futures were higher as markets found support after Libya was forced to shut its largest oil field.

The country’s oil exports tumbled by over half a million barrels a day as a wave of demonstrations hit key facilities.

Oil was also underpinned by an expectation of further EU sanctions on Russia and reports that Shanghai was preparing to ease lockdown restrictions, although the process is expected to be slow.

Figures on Monday showed China’s economic growth accelerated in the first quarter of the year to 4.8%, but the government warned of “significant challenges” ahead as the Covid-19 lockdowns ate into the data.

The FTSE 100 was expected to make little impression at the start of the shorter trading week after finishing up slightly at 7616.38 last week.

Wall Street closed slightly in the red overnight, and Asian shares are mostly in negative territory this morning.

The Dow Jones Industrial Average slipped 0.1%, the broad-based S&P 500 lost 0.90 of a point, and the tech-heavy Nasdaq Composite fell 0.1%.

Japan’s Nikkei 225 index was up 0.6%. In China, the Shanghai Composite was down 0.3%, while the Hang Seng in Hong Kong was down 2.2%. The S&P/ASX 200 in Sydney was up 0.5%.

The World Bank has cut its global growth outlook for the year to 3.2% from 4.1% and a similar downgrade is expected to follow from the IMF later this week.

Economists see a growing risk the UK will slip into a recession in the summer as the surging cost of living hits consumer spending.

Netflix earnings and subscribers slow down

Film and TV streaming service Netflix is one of the first of the FAANG’s to update the market with its first-quarter results today.  

Netflix is expected to report its slowest quarterly revenue growth in nearly eight years today, but the focus will be on its forecast in the run-up to new seasons of popular titles

It recently forecast subscriber growth numbers to slow down, adding only 2.5m new customers from 4m a year before. 

The share price has plummeted since in its last update in the middle of January, losing 22% to $397.20.  

In UK corporate news, there is an annual meeting for Anglo American, one of several big miners updating on production this week, along with results from Benzl, CRH, Foxtons and Rentokil Initial.

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