Stock markets will be reacting on Thursday to one of the most important financial updates of the month after Nvidia’s earnings report saw revenue of $46.7bn (£34.5bn), ahead of estimates, but with data centre earnings slightly lower than predicted. The FTSE 100 fell slightly yesterday as retailers were hit again, but London’s index remains strong over the last month and this year as a whole.
In business, Tesla sales across Europe fell once more last month, while the owner of TikTok, ByteDance, is to complete a share buyback valuing the company at $330bn (£244bn). The owner of the Wagamama restaurants is also considering a bid for Costa Coffee.
Meanwhile, Rachel Reeves has been warned that uncertainty over policy changes is not only hampering businesses, but is now actively slowing down the property market too.
Follow The Independent’s live coverage of the latest stock market and business news here:
Key points
- Nvidia shares fall after hours despite beating earnings expectations
- Landlords could face additional tax from Rachel Reeves
- Wagamama parent company among potential buyers of Costa Coffee
- Tesla sales fall 40% in Europe as EV slide continues under Musk
- Experts react to Nvidia: 'Politics got in the way' and 'a rising tide' for AI firms
Car firm Lotus cuts 550 jobs - but ‘remains committed’ to the UK
14:00 , Karl MatchettLotus Cars is to cut 550 jobs in the UK - but the sportscar manufacturer insists it remains “fully committed” to building in the UK.
Speculation earlier this year suggested Lotus could close a factory in Norfolk and relocate to the US. However, the firm rejected that and after a review of options across the global market, the carmaker has instead decided on changing their work approach across the business.
That will result in the job losses, but gives a “sustainable future” for the company which, like other car manufacturers, has seen tariff uncertainty and pricing battles impact on profitability and planning.
Details:
US stocks set to fall with Nvidia weighing down index
13:30 , Karl MatchettNvidia’s share price represents about 8 per cent of an S&P 500 index now, such is the size of the company.
So it’s no surprise to see the index as a whole is set to open lower - though only marginally so, with futures pointing to a 0.05 per cent drop this afternoon.
The Nasdaq is 0.12 per cent down, while the Dow will rise 0.11 per cent according to the latest numbers.
Meanwhile the FTSE 100 is down 0.3 per cent today, with the Euro Stoxx 50 up 0.08 per cent.
Bankers found out they were being fired after email asking for their laptops to be returned sent by mistake
13:00 , Karl MatchettAustralian bank ANZ has been forced to apologise to employees after emails were sent to them asking them to return their laptops – before management had told them they were losing their jobs.
Automated emails were sent out earlier than planned to more than 100 bankers, with a spokesperson saying the company had “apologised unconditionally” for the error and distress caused.
Full details here:
Bankers learn they’ve been fired via accidental email asking for laptops back
Nvidia reaction: Share price with more room to run?
12:41 , Karl MatchettWhat’s next for the Nvidia share price then, set to open at around $178?
Hard to predict as always and most assessments should be taken with a pinch of salt - such is the rate of change - but plenty are forecasting target prices even higher.
Morgan Stanley lifted their target to $210, KeyBanc to $230, DA Davidson to $195, Truist to $228, Benchmark to $220 and Rosenblatt to $215.
The biggest of those suggests a further 29 per cent climb to come - but again, they are targets which frequently change and do not necessarily all have a successful hit rate.
Matt Britzman, senior equity analyst at Hargreaves Lansdown, believes more share price movement will happen across the week rather than immediately after the results.
“Smart investors will look through the noise. Nvidia has a history of soft trading on earnings day, only to do all the heavy lifting after markets have had time to digest the results,” he pointed out.
Richard Hunter, Head of Markets at interactive investor, added that “the resumption of [chip] sales to China could leave the share price akin to a coiled spring, even after a stellar run”.
That’s due to some investors now seeing China sales as an “extra” to company guidance rather than built in, because of policy uncertainty.
Nvidia reaction: 'Monster' earnings are 'a rising tide moment' in AI
12:22 , Karl MatchettIt’s far from all about the negatives of course - this was still a huge report. And shares were up 3.5 per cent for the week ahead of last night’s numbers.
Kate Leaman, chief market analyst at AvaTrade, points out that usually this would be seen as a long-term success story:
“Nvidia just posted another monster quarter – revenue and earnings per share exceeded expectations, while the company also announced a jaw-dropping $60bn share buyback. That’s the kind of signal markets usually love as it says, ‘We’re confident. We’re here to stay’.”
Ms Leaman added that “the big picture is still intact” and that it showed AI is “a rising tide moment” for more firms than just Nvidia.
There could be more ahead, too, says IG’s Chris Beauchamp.
“The fact its shares have doubled since April mean that the bar was always going to be set pretty high,” he pointed out.
“The deliberate caution around China earnings means that the shares do have some room to go higher [...] while not exactly full of fireworks, last night's figures were perhaps enough to keep risk appetite supported.”
Politics at play denying $50bn from China
12:10 , Karl MatchettFirst we’ll look at the China aspect: restricted sales, a new deal signing over 15% of revenues to the US government and Beijing asking domestic firms to buy Chinese.
All of that has come in the last few months alone and certainly makes a difference.
Dan Coatsworth, investment analyst at AJ Bell, comments:
“AI demand is not the problem for Nvidia, it’s more how politics has got in the way of its grand ambitions for global domination.
“The company is stuck between a rock and a hard place. Nvidia has technology that countless companies are queuing up to buy, yet the US trade war has made it difficult to sell whatever it wants into China.
“Comments on Nvidia’s latest earnings conference call reveal that such sales have yet to restart.
“Nvidia seems to be shaking its head in frustration as its hands are tied with regards to the China situation. Chief executive Jensen Huang says China would be a $50 billion opportunity for Nvidia this year, with the potential for 50% annual growth if it were able to sell what it wants.”
Nvidia reaction: 'Politics got in the way' says expert
12:05 , Karl MatchettSome reaction coming up to Nvidia's earnings, ahead of the market reopening in the US this afternoon.
To recap, in financial terms last night’s report was a huge one - $46bn revenues, $1.05 earnings per share and so on. It hit every target and then some, with the exception of data centre revenue and H20 chip sales to China.
The outcome was a share price drop, however - 1.6 per cent in futures markets, not a spectacular fall by any means, but an indication that perfection is demanded for a $4tn company.
So what are the experts saying?
Tesla sales fall 40% in Europe despite rise in consumers buying EVs
11:54 , Karl MatchettSales at Elon Musk’s Tesla have fallen by a shocking 40 per cent in Europe amid increased pressure from Chinese rivals in the electric vehicles (EVs) industry.
New data from the European Automobile Manufacturers’ Association (ACEA) shows EV sales rose by more than a third in July (33.6 per cent), meaning that combined with Tesla’s own drop in sales, the company’s market share has dropped to below one per cent.
More details - and the big winners this year so far - here.
Poundland confirms major price changes amid store closures
11:18 , Karl MatchettDiscount retailer Poundland is set to revert to its core pricing model of £1, £2, and £3 across all UK grocery items, a strategic move aimed at revitalising its business following a recent brush with administration.
This shift, which will see approximately 60 per cent of its grocery range priced at £1, follows a successful five-month trial across 17 stores in the West Midlands.
The company stated the change marks a return "back to its roots" and signifies "the end of additional price complexity", with similar simplified pricing planned for general merchandise and clothing in the coming months.
An unexpected benefit of the trial was a significant reduction in shoplifting, with incidents falling by over a quarter.
TikTok parent company valued at over $330bn
10:40 , Karl MatchettThe owner of TikTok, ByteDance, is to hold a share buyback scheme for employees which will see the firm valued at more than $330bn (£244bn).
It’s expected that employees will be offered just over $200 per share, more than 5 per cent higher than a similar offering six months ago.
The offer will go live in autumn according to reports.
It earned greater revenues than Meta in the first quarter of this year, making it the world’s biggest social media firm.
TikTok was supposed to be sold by January after a presidential intervention by Donald Trump but he has backed down to offer extensions multiple times, with the latest running to 17 September.
Lidl to create hundreds of jobs after £435m investment
10:20 , Karl MatchettLidl is poised to create more than 500 new jobs across the UK as part of a significant £435 million investment in its logistics infrastructure, which includes the completion of a major expansion at its London site and the commencement of construction on a new warehouse in Leeds.
The German-owned supermarket chain confirmed the £285 million redevelopment of its Belvedere warehouse in London, which involved the construction of a second building, effectively tripling the site's capacity.
This expanded facility is expected to serve 120 stores once fully operational. Concurrently, Lidl has begun work on a new £150 million warehouse in Leeds.
These combined developments are projected to generate more than 500 new roles, with 120 positions in London and 400 in Leeds.
PA:
UK supermarket to create hundreds of jobs in £435m expansion
Costa Coffee: How much will it cost and what happens next?
10:00 , Karl MatchettReports suggest Costa Coffee could be on the market for around £2bn.
That’s half of what it was bought for six years ago but coffee sales in the UK are below the level now from when Coca-Cola bought it.
There are more than 2,000 stores in the UK and Costa operates across 50 different countries, though Coca-Cola have not released figures on total stores or employees worldwide.
Costa has about 38% of the UK coffee market share according to research, but it is under pressure from cheaper alternatives like Gregg’s, and more upmarket offerings such as local specialist coffee boutiques or independent cafes.
Add in increased employer costs this year in the UK and it’s clearly a tough time for many businesses right now - though it’s still one which recorded revenues of £1.2bn in 2023.
Costa Coffee up for sale: Who wants to buy it?
09:45 , Karl MatchettCosta Coffee is a UK high street staple. You see it pretty much everywhere: main shops, inside shopping centres, even within petrol stations in a tiny kiosk or machine.
But it’s not a standalone company; Costa was bought by Coca-Cola in 2019 for nearly £4bn.
Since then the drinks firm has struggled to integrate it properly within its wider ecosystem and doesn’t feel the brand is generating the return it wanted. So, it’s up for sale - potentially at least, as one of several possible outcomes of a review.
At present there are three main parties who seem to be at least exploring a deal.
Apollo Global Management is the eventual parent of restaurants like Wagamama, and Bar Burrito.
KKR is a US-based private equity firm who have also held early talks, according to reports.
And Sky News initially reported a “small number” of firms who may have had exploratory talks.
There’s still a chance a sale doesn’t go through, but bids are expected in October.
Reeves ‘plots tax raid on landlords’ to help plug £40bn Budget black hole
09:10 , Karl MatchettRachel Reeves is reportedly plotting a tax raid on landlords in an attempt to plug the up to £40bn blackhole in the nation’s finances.
The chancellor is considering raising taxes for landlords in her next budget by applying national insurance (NI) to rental income, arguing the move would target “unearned income”, according to reports.
The plans aim to make the Treasury £2bn, as it attempts to avoid breaking the chancellor’s “red lines” outlined before the general election, which included not increasing VAT, income tax or national insurance.
Reeves ‘plots tax raid on landlords’ to help plug £40bn Budget black hole
Lottery firm valued at £9.6bn after Czech owner sells part of stake
08:45 , Karl MatchettCzech tycoon Karel Komarek’s investment vehicle has sold a stake in Allwyn in a deal valuing the National Lottery operator at 11.2 billion euros (£9.6 billion).
Allwyn said central European investment fund J&T Arch has snapped up a 4.27% stake in the business from Mr Komarek’s KKCG business, which remains the majority owner.
In 2019, KKCG took 100% control of European lottery group Sazka Group before rebranding it as Allwyn.
It was awarded the licence to run the National Lottery in 2022.
Later that year, Allwyn then agreed a takeover deal for Camelot, which had previously run the UK’s National Lottery licence.
More details here.
Nvidia: Shares fall despite $46.7bn earnings beating expectations
08:30 , Karl MatchettLast night was a key event in the stock markets as Nvidia reported their earnings for the last quarter.
Without going into the finances in too much detail, $46.7bn in earnings was more than expected and earnings per share was higher than analysts’ anticipated levels too - but the share price fell after data centre revenue fell $0.2bn short of predictions.
It fell around 3 per cent initially but has since bounced back in pre-market trading, with the Nasdaq firm set to open 1.9 per cent lower according to the latest futures markets.
Nvidia is the biggest company in the world, valued at over $4tn, and the share price hit a new all time high at just over $183 earlier this month.
It’ll be around $177-178 later this afternoon when markets open, if it stays down in the 2-3 per cent range.
It’s value is so carefully watched as it makes up a significant chunk of many funds, including a basic tracker of US companies or more specifically tech-focused ones.
Royal Mail launches services to help customers post to US after new charges
08:15 , Karl MatchettRoyal Mail has announced it will be the first international postal operator to launch new services so people can continue sending goods to the United States ahead of new customs requirements coming into effect on Friday.
From today, Royal Mail customers can use the company’s new postal delivery duties paid (PDDP) services.
The move follows a US executive order last month which said that goods valued at 800 dollars or less will no longer be exempt from import duties and taxes from August 29.
More details here.
Royal Mail launches services to help customers post to US after new charges
FTSE 100 in small rise after opening
08:06 , Karl MatchettThe FTSE 100 fell yesterday as an afternoon slump left it around 0.1 per cent down for the day - and it’s up by less than that at the start of trading, about 0.06 per cent in the green.
There are no massive names reporting today but a few such as the Macfarlane Group and PPHE Hotel Group - which owns brands like Park Plaza, Radisson Collection and others - are some of the smaller or FTSE 250 firms set for reporting.
Business and Money news live
07:54 , Karl MatchettGood morning all, we’ll get rolling today with FTSE 100 news and looking at Nvidia’s results from last night, then we’ve got a roundup of the bidding battle for Costa Coffee - a UK high street staple.
