London pre-open: Stocks to fall after Wall St losses

(Sharecast News) - London stocks were set to fall at the open on Thursday following losses on Wall Street, where tech names came under pressure. The FTSE 100 was called to open down around 30 points.

Ipek Ozkardeskaya, senior analyst at Swissquote Bank, said: "Underwhelming results from Tesla and Alphabet painted the equity markets in the red yesterday. The S&P 500 experienced its worst selloff since December 2022 with a 2.30% drop. It tested its 50-DMA (near 5428) to the downside. Nasdaq 100 tumbled 3.65% and sank below its own 50-DMA.

"Tesla dived more than 12% on earnings miss and no fresh news on robotaxis, Google lost 5% on prospects of increased AI spending. Google's capex spending will reach or exceed $24bn that will bring the total spending this year to almost $50bn - or around 84% more than the past five-year average according to the WSJ. The company CEO thinks that underinvesting is a bigger risk than overinvesting. But that narrative is no longer welcome among investors."

In UK corporate news, Lloyds Banking Group reported a drop in first-half profit as costs rose.

In the six months to the end of June, statutory pre-tax profit fell 14% from the same period a year earlier to £3.32bn. This was due to lower net interest income and higher operating expenses, partly offset by a lower impairment charge, the bank said.

Underlying net interest income declined 10% to £6.3bn, while operating costs rose 7%.

Chief executive Charlie Nunn said: "In the first six months of 2024, the group delivered robust financial results with solid income performance and cost discipline alongside strong capital generation.

"2024 is a key year for our strategic delivery. We continue to deliver on our strategic transformation, as illustrated in the fourth of our investor seminars last month. We remain on track to meet our 2024 targeted outcomes. Indeed, our progress to date enables us to reaffirm 2024 guidance and remain confident in achieving our 2026 strategic objectives and guidance."

BT reiterated full-year targets after what it called a "solid start" to the year, with strong growth in fibre and customer numbers, though revenues were held back by a weaker performance in the business division.

Adjusted revenues in the first quarter ended 30 June were down 2% at £5.1bn due to legacy managed contract declines, reduced low margin sales activity and contraction in the portfolio unit within business.

The continued shift to mobile SIM only and a lower CPI benefit in a competitive market in the consumer division also weighed on the top line. Adjusted EBITDA rose by just 1% to £2.1bn.

AstraZeneca lifted its full-year guidance as it reported an 18% increase in total revenue for the first half to $25.6bn, driven by significant growth in product sales and alliance revenue.

The FTSE 100 pharmaceuticals giant saw 22% growth in revenue from oncology, CVRM, and R&I, while rare disease revenue grew by 15%, with a core operating margin of 33% and a core earnings per share increase of 5% to $4.03.

AstraZeneca declared a seven-cent increase in its interim dividend and raised its full-year 2024 guidance, expecting mid-teens percentage growth in total revenue and core earnings per share at constant exchange rates.