Register for Digital Look

London pre-open: Stocks seen lower amid Sino-US worries; Netflix disappoints

By Michele Maatouk

Date: Thursday 18 Jul 2019

London pre-open: Stocks seen lower amid Sino-US worries; Netflix disappoints

(Sharecast News) - London stocks were set for a weaker open on Thursday amid ongoing worries about Sino-US trade relations and following the release of uninspiring results from Netflix, with all eyes on the release of UK retail sales data.
The FTSE 100 was called to open 25 points lower at 7,510.

Disappointing results from Netflix overnight were likely to weigh on sentiment, as the company's quarterly subscriber growth failed to live up to expectations.

Nicholas Hyett, equity analyst at Hargreaves Lansdown, said: "Revenues continue to climb rapidly, up 26% year-on-year to $4.9bn, and operating profits of $706m have come in well above market expectations. However, subscriber growth has been subdued this quarter. Net additions of 2.7m new subscribers is well below both market expectations and the company's own guidance of 5m. Netflix now has 151.56m paying subscribers."

On home turf, UK retail sales figures for June will be in focus at 0930 BST.

Ipek Ozkardeskaya, senior market analyst at London Capital Group, said the data could hint at 0.2% month-on-month contraction in June, excluding auto fuel. "But the sales may have improved from 2.2% to 2.6% on yearly basis. A negative surprise may further revive the Bank of England doves and weigh on the pound," she added.

In corporate news, Anglo American said it was lowering full year production guidance to the bottom end of forecasts at its De Beers diamond operation in response to weaker market conditions.

The miner said overall second quarter production was up 2% due to the successful ramp-up at Minas-Rio after a shutdown in 2018 and strong performance at metallurgical coal after longwall moves and plant upgrade work in the first quarter.

SSE said its outlook for the current 2020 financial year remained unchanged from the one it gave in May in a trading update, despite lower-than-forecast renewable energy output in the first three months of the year.

The FTSE 100 energy firm said the shortfall in output was equivalent to less than 4% of the annual forecast total. It said its outlook for adjusted operating profit included suspended capacity market payments totalling £148m, and re-iterated its intention to recommend a full-year dividend of 80p per share - in line with the five-year dividend plan set out last year.

Hilton Food said that trading in its year to date has been broadly in line with expectations, with a slight dip in turnover from the Netherlands offset by "strong double-digit growth" in Australia and good progress in Western Europe at large.

The food packing business added its financial position remains strong despite the development of new facilities in Brisbane and New Zealand, with the business continuing to explore further opportunities to expand.


Email this article to a friend

or share it with one of these popular networks:

Top of Page