loyds Banking Group and drugs giant GSK have raised their 2022 guidance after publishing robust half-year results today.
The UK’s biggest lender reported “continued business momentum” and said asset quality was strong despite the cost of living pressures. Profits were lower at £2.8 billion due to comparisons with last year’s release of pandemic impairment provisions.
GSK’s first set of results since the demerger of its consumer healthcare business revealed that it now expects sales growth of between 6% and 8%, compared with 5% and 7% previously.
Alphabet reassures, focus on Federal Reserve decision
Google and YouTube business Alphabet has set the tone for an improved session on Wall Street, having delivered a reassuring update after last night’s closing bell.
Its second quarter figures, which included a 16% rise in revenues to $69.7 billion, eased anxiety over advertising demand since a warning from Snapchat owner Snap.
Alphabet’s shares rose 5% in extended trading and Microsoft also improved 4% after its results included solid forward sales guidance.
Their performances mean the tech-heavy Nasdaq is set to rebound by more than 1% later today, having fallen by 1.9% yesterday due to ongoing recession fears.
Tuesday’s sell-off also reflected jitters ahead of tonight’s US Federal Reserve rates decision and press conference. A further 75 basis points increase is seen as a certainty, with the focus now on whether a similar hike is in the pipeline for September’s meeting.
However, August’s Jackson Hole gathering of central bankers and two sets of inflation and payroll reports mean there’s much that can happen before the next meeting.
For now, Michael Hewson of CMC Markets thinks the Fed will stick to the narrative that it needs to get inflation under control even if it pushes headline unemployment higher.
He added: “Anyone thinking that in light of recent data that the Fed is likely to soften its tone is probably going to be disappointed.”
In Europe, investors are focused on the threat of recession after EU members agreed to cut gas demand by 15% in response to Nord Stream 1 being at 20% of pipeline capacity.
Yesterday’s session also saw consumer stocks under pressure after a warning over slower general merchandise spend at US giant Walmart. CMC expects the FTSE 100 index to open 25 points higher at 7311.
Credit: www.standard.co.uk /