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Stock prices in Europe and Asia were supported by the tantalising prospect of Federal Reserve interest rate cuts, shaking off geopolitical worries. Jobs data revisions in the US added to the conviction that the Fed will cut this month. Elsewhere, earnings from Oracle impressed overnight. The FTSE 100 index rose 23.65 points, 0.3%, at 9,266.18. The FTSE 100 has risen every day this week. The FTSE 250 was up 48.83 points, 0.2%, at 21,645.54, and the AIM All-Share was down 3.01 points, 0.4%, at 765.29. The Cboe UK 100 was up 0.2% at 928.73, the Cboe UK 250 was up 0.1% at 18,940.84, but the Cboe Small Companies was 0.2% lower at 17,070.88. In Paris, the CAC 40 was up 0.7%. In Frankfurt, the DAX 40 was 0.5% higher. Much like the FTSE 100, the CAC 40 has closed higher every day this week so far. The DAX 40 declined on Tuesday. The White House distanced itself Tuesday from Israel’s strikes against Hamas in Doha, reiterating President Donald Trump’s support for ally Qatar, while declining to confirm if Israel had pre-notified Washington of its attack. While eliminating Hamas was a ‘worthy goal,’ a strike in the Qatari capital Doha ‘does not advance Israel or America’s goals,’ White House Press Secretary Karoline Leavitt told reporters, reading from a statement. ‘The president views Qatar as a strong ally and friend of the US, and feels very badly about the location of this attack,’ she said. Poland said Wednesday that ‘hostile objects’ had been downed by Polish or allied aircraft scrambled in response to multiple violations of its airspace during a Russian attack on Ukraine. ‘Aircraft have used weapons against hostile objects,’ Defence Minister Wladyslaw Kosiniak-Kamysz said on social media, adding: ‘We are in constant contact with Nato command.’ Russian drones and missiles have entered the airspace of Nato members including Poland several times during Russia’s three-and-a-half-year war, but a Nato country has never attempted to shoot them down. ‘Away from geopolitics, risk assets remain in rude health. Helping US equities have been some stellar results from Oracle, where its data centre business is performing well and supporting the hype in AI investment. And the prospect of the Fed cutting rates by 125-150bp over the next nine months can only support leverage and demand that asset managers remain fully invested to earn their fees. This is a benign, bearish environment for the dollar,’ analysts at ING commented. Nonetheless, the dollar was resilient early Wednesday, with only sterling progressing against it. The pound traded at $1.3536 early Wednesday, up slightly from $1.3531 at the time of the London equities on Tuesday. The euro fell to $1.1699 from $1.1724. Against the yen, the dollar bought JP¥147.46, up from JP¥147.20. Shares in Oracle leapt as it predicted buoyant cloud infrastructure sales, reflecting strong demand, after what it called an ‘astonishing’ quarter. Shares shot up 28% in after hours trading. The Austin, Texas-based, cloud technologies-focused company said net income was flat $2.93 billion in the three months to August 31 with diluted earnings per share up edging down to $1.01 from $1.03. Revenue increased 12% to $14.93 billion from $13.31 billion a year prior, shy of $15.03 billion consensus. Total remaining performance obligations were up 359% year-over-year to $455 billion, Cloud revenue rose 28% to $7.2 billion but software revenue was down 1% at $5.7 billion. ‘We signed four multi-billion-dollar contracts with three different customers in Q1,’ said Oracle Chief Executive Safra Catz. ‘It was an astonishing quarter - and demand for Oracle Cloud Infrastructure continues to build. Over the next few months, we expect to sign-up several additional multi-billion-dollar customers and RPO is likely to exceed half-a-trillion dollars,’ Catz added. In the US on Tuesday, the Dow Jones Industrial Average added 0.4%, the S&P 500 rose 0.3% and the Nasdaq Composite climbed 0.4%. The yield on the US 10-year Treasury widened slightly to 4.09% from 4.08%. The yield on the 30-year stretched marginally to 4.74% from 4.73%. Aiding Fed cut hopes, the US Bureau of Labor Statistics on Tuesday said it had overestimated total nonfarm employment by 911,000 jobs, or 0.6%, in the 12 months through March 2025, according to its preliminary benchmark revision. Analysts at Lloyds Bank commented: ‘While further revisions could still reshape this profile (and this is all backward looking), considering the events that have roiled the economy since March it is hard to have confidence that could mean a positive evolution. Really, this update should just reinforce concerns that the Fed are late in addressing labour market risks and gives the economy an even more stagflationary hue.’ The global economic calendar on Wednesday has US producer price inflation figures at 1330 BST. Consumer prices in China fell last month at their fastest rate in six months, official data showed Wednesday, a sign of persistent deflationary pressure in the world’s second-largest economy. Beijing has in recent years been battling sluggish domestic spending, dragged down by a prolonged slump in the country’s vast property market as pressure on exports mounts. The consumer price index a key measure of inflation dropped 0.4% year-on-year in August, compared to a flat reading in July, according to data released by China’s National Bureau of Statistics. The reading was lower than the 0.2% fall Bloomberg forecast based on a survey of economists. It also marked the steepest decline since February’s drop of 0.7%. In Tokyo on Wednesday, the Nikkei 225 rose 0.9%. In China, the Shanghai Composite was up 0.1%, while the Hang Seng Index in Hong Kong was 1.1% higher. In Sydney, the S&P/ASX 200 added 0.3%. Gold rose to $3,645.06 an ounce early Wednesday from $3,640.80 late Tuesday. A barrel of Brent eased slightly to $66.81 from $66.91. In London, shares in AB Foods slumped 9.4%, the worst FTSE 100 performer. It said it expects the consumer environment to remain ‘uncertain’, as it reported sluggish sales at Primark, and further struggles at its Sugar business. Primark sales growth is expected to be around 1% in the second half of the financial year to September 13 compared to the year prior, below Visible Alpha consensus of 3.4%, with growth of 1% in the third quarter and projected growth of 1% in the fourth quarter. Primark like-for-like sales in the second half are expected to be around 2% below last year, versus VA consensus for a drop of 1%, with a decline of 2.4% in the third quarter and a projected decline of around 2% in the fourth quarter. Haleon shares rose 2.8%, as Goldman Sachs raised the consumer healthcare firm to ’buy’. Elsewhere, Gym Group surged 9.5%. It said its half-year profit jumped as a ‘growth plan continues to deliver progress’. The low-cost gym operator said pretax profit in the half-year to June 30 surged to £3.3 million from £200,000 a year earlier, while revenue increased 7.9% to £121.0 million from £112.1 million. Adjusted earnings before interest, tax, depreciation, and amortisation, less normalised rent, climbed 24% to £27.4 million from £22.1 million. ‘This strong set of half year results reflects continued progress against the strategic objectives set out in our next chapter growth plan 18 months ago. Our high value, low cost proposition continues to resonate, with members visiting the gym more often than ever,’ Chief Executive Officer Will Orr said. ‘Encouragingly, the sites opened this year, which reflect new design features, are performing ahead of expectations, and we are on track to deliver our target of opening 14-16 new gyms this year, all funded from free cash flow, taking us beyond 250 sites. In a growing sector, we have once again increased membership, revenue and profit and are well set to deliver full year results at the top end of market expectations.’ Gym Group said consensus expects an adjusted Ebitda, less normalised rent, between £50.6 million and £52.8 million. It added that ‘trading momentum continued in July and August’, cementing its confidence that it can deliver around 3% like-for-like revenue growth for the full year. Total member numbers at the half-year end rose to 949,000, up 7% from the end of December. Serica Energy shares plunged 11%. The North Sea-focused oil and gas producer lowered its annual outlook as ‘vibration issues’ mean production at the Triton asset is currently at a ‘significantly reduced rate’. Serica now expects output for 2025 between 29,000 to 32,000 barrels of oil equivalent per day. Its output forecast was previously a 33,000 to 35,000 range. ‘Following a successful ramp up which helped wider portfolio production reach over 55,000 boepd in mid-August, the operator of the Triton FPSO, Dana Petroleum, has notified Serica of a temporary reduction in production while further maintenance takes place. In addition, Dana has also notified the company that subsea intervention work on the Bittern field has been scheduled for November 2025,’ Serica explains. Copyright 2025 Alliance News Ltd. All Rights Reserved.
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