FTSE 100 LIVE: Storming start for markets as FTSE leads European charge

Things weren’t as bright further afield, however. The US saw its largest gross domestic product contraction since World War 2 today. This ramped up fears over an economic recovery from the coronavirus pandemic being further away than first thought. Julian Evans-Pritchard, senior China economist at Capital Economics, told the FT: “The current rapid pace of recovery is likely to slow in the coming months as the initial boost from reopening businesses fades.” 

Japan’s benchmark Topix index fell 1.4 percent in early trading in Asia-Pacific while Australia’s S&P/ASX 200 dropped 1.5 percent.

The S&P 500 closed 0.4 percent lower, despite companies including Amazon, Apple and Facebook recording huge quarterly results.

The US benchmark is expected to rise 0.6 percent when trading starts later today.


FTSE 100 LIVE: Global stocks struggled on Friday

FTSE 100 LIVE: Global stocks struggled on Friday (Image: GETTY)

12.47pm update: Expert discusses euro surge

The euro traded below $1.10 as recently as May, but after EU leaders agreed this month to a 750 billion euro economic recovery fund many investors have warmed to the currency again.

On a trade-weighted basis, the euro is at its highest since 2014.

“Disinflationary pressure from the unprecedented hit to demand alongside the strengthening euro will keep pressure on the ECB to deliver further policy stimulus,” MUFG analyst Lee Hardman said.

12.10pm update: Dollar heads for biggest monthly drop in a decade

The dollar extended its dramatic fall on Friday.

It puts the currency on course for its biggest monthly drop in a decade.

Experts fear the huge tumble is due to growing fears over the coronavirus crisis.

The dollar index slid as low as 92.546 in early trading on Friday, a level last seen in May 2018, before recovering to trade flat at 92.847.

11.30am update: NatWest caps off bad week after COVID hit

NatWest Group capped off a bad week for the UK’s high street banks with a £2.1 billion hit from the impact of the coronavirus crisis.

Chief executive Alison Rose said: “Our performance in the first half of the year has been significantly impacted by the challenges and uncertainty our economy continues to face as a result of COVID-19.

“However, NatWest Group has a robust capital position, underpinned by a resilient, capital-generative and well-diversified business.”

10.45am update: Portugal’s GDP slumps 14.1 percent

Portugal’s gross domestic product shrank 14.1 percent in the second quarter of 2020.

The fall marks the biggest contraction ever, as lockdowns imposed to contain the spread of the coronavirus hit key sectors of the economy.

Filipe Garcia, information economist at Financial Markets, in Porto, said: “It is a number which will be remembered in the history of Portuguese economy, a consequence of strong confinement, particularly between mid-March and the end of April, which affected almost all economic sectors.”

Rishi Sunak

Chancellor Rishi Sunak (Image: getty)

10.25am update: Italian 10-year bonds set for best month since January

Italian 10-year bond yields were set for their biggest monthly drop since January on Friday.

It came following a boost after EU leaders agreed a mammoth recovery fund.

Italy’s 10-year yield dropped 30 basis points in July to its lowest since early March, its biggest monthly fall since January.

That also dragged down the risk premium it pays over Germany for 10-year debt to March lows.

10.00am update: Bright start for EU markets

Like FTSE, markets across Europe are also enjoying a positive start to the day’s trading.

Euronext 100, CAC 40, DAX and Swiss Market Index are all up this morning.

Euronext is up 1.05%, CAC 0.97%, DAX 1.17% and Swiss Market 1.01%.

FTSE is up 0.93%.

8.30am update: FTSE opens strong after week of morning losses

In a break from this week’s pattern, FTSE has opened the week with a bang.

Whereas yesterday and earlier in the week the UK index fell on open, today it has risen 0.50%.

After closing yesterday at 5,989, it has this morning risen to 6,022.

5.56am update: Asian stocks stumble as global growth fears temper tech boost

Asian shares struggled this morning as economic data from the United States and rising global COVID-19 cases played a huge factor, despite strong US tech earnings and signs of manufacturing recovery in China and Japan.

The US dollar was also set for its worst month in a decade amid expectations the Fed will maintain its ultra-loose monetary policy for years.

US GDP collapsed at a 32.9 percent annualized rate in the second quarter, the deepest decline on record, while jobless claims rose last week, adding to signs the momentum of economic recovery has slowed.

“We are seeing some tentative signs of an improvement in global trade flows as economies reopen, but the overhang from recessionary conditions in the developed world and rising infection rates are kind of a focus for investors at the moment,” said Ryan Felsman, senior economist at CommSec in Sydney.

Additional reporting by Rachel Russell. 

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