Nvidia results are the main focus for investors after the chip giant’s quarterly figures beat expectations but shares still fell.
The retreat came after Wall Street’s S&P 500 index last night closed at a fresh record.
Drax shares fell after it disclosed an investigation by the Financial Conduct Authority into the firm’s sourcing of wood for biomass pellets.
FTSE 100 Live Thursday
- Nvidia shares fall on results
- Drax facing FCA probe
- Reeves mulls tax raid on landlords
Market update: FTSE 100 lower, JD Sports Fashion extends strong run
09:55 , Graeme EvansA downbeat reaction to the forecast-beating results of Nvidia today weighed on global sentiment as the FTSE 100 index drifted below the opening line.
The semiconductor giant’s July quarter revenues of $46.7 billion and its guidance for the current period were both ahead of Wall Street expectations.
However, Nvidia shares fell 3% in after-hours dealings as traders focused on uncertainty over China shipments and a small miss in Nvidia’s data centre division.
The fall for the $4.4 trillion-valued company follows a robust recovery since April’s tariffs turmoil, with shares up by more than a third this year.
AJ Bell investment analyst Dan Coatsworth said: “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.”
With futures trading pointing to a subdued start to today’s Wall Street session, the FTSE 100 index struggled to make headway.
London’s top flight drifted 18.13 points to 9237.37, with Aviva and Auto Trader among the biggest fallers after their shares were marked ex-dividend.
Diageo shares led the top flight, lifting 46p to 2100p amid the read across to the better-than-expected annual results of French spirits firm Pernod Ricard.
JD Sports Fashion also added another 2.3p to 99.7p, having risen 3.5% yesterday after reporting a recovery in North American trading in its second quarter update.
Berenberg analysts responded by maintaining their Buy recommendation with an improved price target of 155p.
In the FTSE 250, IT services business Softcat rose 5% or 73p to 1638p after it forecast mid-teens growth in operating profit for the year to the end of last month.
Burberry shares also lifted 43.5p to 1348.5p as the luxury goods group maintained its late push for promotion in the forthcoming FTSE 100 reshuffle.
Drax shares fell 10% or 67.5p to 636p after it disclosed an investigation by the Financial Conduct Authority into the firm’s sourcing of wood for biomass pellets.
The probe covers more than two years, from January 2022 to March 2024. It will also look at the compliance of Drax’s annual reports from 2021, 2022 and 2023 with rules over listing, disclosure and transparency.
Drax said it will “co-operate with the FCA as part of their investigation”.
FCA investigates Drax biomass sourcing, shares fall 7%
08:40 , Graeme EvansPower station business Drax is under investigation by the UK’s financial watchdog over the firm’s sourcing of wood for biomass pellets.
The London-listed group said the Financial Conduct Authority (FCA) probe covers more than two years, from January 2022 to March 2024.
The review will also look at compliance of Drax’s annual reports from 2021, 2022 and 2023 with rules over listing, disclosure and transparency.
Drax said it will “co-operate with the FCA as part of their investigation”. Shares in the FTSE 250 firm fell 7% or 48p to 655.5p.
Diageo leads FTSE 100, Drax shares fall 7% on FCA investigation
08:30 , Graeme EvansThe FTSE 100 index has made a steady start to the session, rising 7.05 points to 9262.55.
Diageo shares lead the top flight amid the read across to the better-than-expected annual results of French spirits firm Pernod Ricard. Diageo rose 30.1p to 2084.1p.
JD Sports Fashion added another 1.1p to 98.5p after Berenberg analysts highlighted a price target of 155p following yesterday’s reassuring trading update.
Ex-dividend stocks Aviva and Auto Trader were among the biggest fallers, down 13.4p to 663.8p and 8.6p to 809p respectively.
In the FTSE 250, IT services business Softcat rose 35p to 1600p after it forecast mid-teens growth in operating profit for the year to the end of last month.
Drax fell 7% or 48p to 655.5p after it disclosed an investigation by the Financial Conduct Authority covering certain historical statements regarding biomass sourcing between January 2022 and March 2024.
Reeves mulls £2bn tax raid on landlords - report
07:58 , Graeme EvansThe Treasury is reportedly considering a tax increase on landlords by imposing national insurance on rental income.
Officials are said to be looking at proposals to hike a levy on property earnings in the hope of raising £2 billion.
The speculation comes as Chancellor Rachel Reeves searches for ways to raise cash amid dire warnings about the state of the public finances.
The move is backed by some Labour MPs and Government aides, with some proponents saying that landlords were seen as a way of targeting “unearned revenue”, The Times reported.
Royal Mail launches new services ahead of US duty changes
07:44 , Graeme EvansRoyal Mail today launched new services so customers can continue sending goods to the United States ahead of new customs requirements.
The introduction of the company’s new postal delivery duties paid (PDDP) services follows a US executive order, which said that goods valued at $800 or less will no longer be exempt from import duties and taxes from August 29.
Iain Johnson, managing director international at Royal Mail, said: “We have been working hard with the relevant US authorities and our international partners to adapt our services in a very short timeframe.”
Car production higher for second month in row
07:20 , Graeme EvansCar production in the UK rose for a second successive month in July, up 5.6% on the same period in 2024 to 69,127.
Plant restructuring meant commercial vehicle output fell by 81.1% compared to 12 months ago, which saw the highest figure for 17 years.
This meant the total production number recorded by the Society of Motor Manufacturers and Traders fell by 10.8% year-on-year to 72,006.
Chief executive Mike Hawes said: “It remains a turbulent time for automotive manufacturing, with consumer confidence weak, trade flows volatile and massive investment in new technologies underway both here and abroad.”
Nvidia results beat forecasts, shares fall back
07:11 , Graeme EvansNvidia shares have dipped 3% in after-hours trading, despite another forecast-beating set of results.
Second quarter revenues of $46.7 billion compared with Wall Street estimates of $46 billion and the company’s initial guidance of $45 billion. Adjusted earnings per share of $1.05 topped predictions of $1.01.
Nvidia also produced top-of-the range revenues guidance of $54 billion for the current quarter, even though recent export restrictions mean this factors in no shipments of its H20 chips to China.
The China uncertainty and a small miss on revenues in Nvidia’s data centre division have been blamed for the weak share price performance.
Hargreaves Lansdown analyst Matt Britzman points out that Nvidia shares have traded flat or down after results in four of the past five quarters, only to rally after markets have had time to digest the figures.
He added: “Nvidia’s dominance in AI infrastructure remains unparalleled, cementing its position as the cornerstone of the AI revolution.
“With a customer base spanning cloud giants to sovereign entities and a relentless pace of product innovation, Nvidia continues to set the standard for the industry.
“Under the leadership of its visionary CEO, it’s proving to be the ultimate way to play the AI investment theme.“
The company is valued at $4.4 trillion after shares rose 35% this year to trade at a record above $180.
Nvidia falls after S&P 500 record, FTSE 100 seen higher
07:01 , Graeme EvansWall Street futures are mixed after forecast-beating results by semiconductor giant Nvidia failed to send its shares to fresh highs in after-hours dealings.
Nvidia dropped 3%, while the S&P 500 index is set for a slightly weaker start at Wall Street’s opening bell.
The leading US benchmark closed at a record high last night after adding 0.2%, while the Dow Jones Industrial Average finished up by 0.3%.
The FTSE 100 index is seen opening 0.1% higher, having closed down 10.30 points or 0.1% at 9255.50 yesterday.
