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US stocks up and Europe down as inflation data hits expectations

How markets are performing on Friday

Lucy Harley-McKeown
Updated
FTSE NEW YORK, NEW YORK - JUNE 18: Traders work on the floor of the New York Stock Exchange (NYSE) on June 18, 2024 in New York City. After the S&P 500 and Nasdaq closed at record highs Monday, U.S. stocks were up in early trading Tuesday. (Photo by Spencer Platt/Getty Images)
The FTSE was up on Friday, while US stocks also rose as key inflation data hit expectations. (Spencer Platt via Getty Images)

The FTSE 100 was in the red on Friday in London, and European stocks were down, following a UK GDP print which showed the economy had grown at a faster clip than previously estimated in the first quarter of 2024, and at the fastest pace in the G7. Meanwhile, a key inflation data point hit expectations in the US.

  • FTSE 100 (^FTSE) was down around 0.2% by the time the US stock market opened.

  • The DAX (^GDAXI) was almost flat while the CAC (^FCHI) fell 1%. The pan-European STOXX 600 (^STOXX) fell 0.3%.

  • Over in the US, stocks rose as a closely-watched inflation gauge showed that prices rose last month at the slowest clip since 2021, and investors absorbed the fallout of the Biden-Trump debate.

  • The core personal consumption expenditures (PCE) index, which strips out the cost of food and energy and is closely watched by the Fed, rose 0.1 % in May from the prior month, in line with Wall Street's expectations.

  • The S&P 500 (^GSPC) ticked up 0.3%, the Dow (^DJI) was 0.3% higher, and the Nasdaq (^IXIC) was 0.4% higher.

  • Data released earlier on Friday in the UK shows that the first three months of the year saw the economy grow 0.7%. It had been estimated it would grow 0.6%. The pace of growth compared with the previous quarter was the fastest in the G7.

  • The most watched data release today was the PCE inflation data – a key measure of how inflation is affecting ordinary consumers and a signal of how quickly the US Federal Reserve might look to start cutting its key interest rates.

Follow along for live updates:

LIVE COVERAGE IS OVER17 updates
  • Lucy Harley-McKeown

    Thanks for reading

    Head over to our US site for more market moving news. Happy Friday!

  • Lucy Harley-McKeown

    Walgreens stages small recovery

    ... meanwhile, Walgreens is staging a small comeback, up 3% in early trade:

    The company's stock plummeted 22% on Thursday, its worst trading in at least four decades, closing at $12.19 per share.

    The stock slumped on the news the company slashed its profit guidance, the second time it has adjusted guidance downward this year.

    Walgreens now estimates earnings per share of between $2.80 and $2.95, down from guidance of $3.20 to $3.35 last quarter — when it narrowed guidance on the upper end.

    Investors are watching the company closely as CEO Tim Wentworth executes a new strategy for the company. He is focused on what he views as revitalising pharmacies and pulling back on healthcare services through VillageMD — of which Walgreens is no longer a major stakeholder.

  • Lucy Harley-McKeown

    Nike nearly 20% lower

    As we reported earlier, the market is bearish on Nike today — not long into the trading day and the share price is almost 20% lower:

  • Lucy Harley-McKeown

    How stocks are faring at the US open

  • Lucy Harley-McKeown

    A useful guide on potential volatility

  • Lucy Harley-McKeown

    US PCE comes in as expected

    Here are the numbers:

    • US Core PCE Price Index (M/M) May: 0.1% (est 0.1%; prev 0.2%)

    • Core PCE Price Index (Y/Y) May: 2.6% (est 2.6%; prev 2.8%)

    • PCE Price Index (M/M) May: 0.0% (est 0.0%; prev 0.3%)

    • PCE Price Index (Y/Y) May: 2.6% (est 2.6%; prev 2.7%)

  • Lucy Harley-McKeown

    Check out the stocks we're watching today

    Today's trending tickers

  • Lucy Harley-McKeown

    UK property transactions tick up, despite high interest rates

    Some data from HMRC, signalling positive things for the housing market:

    • Provisional seasonally adjusted estimate of the number of UK residential transactions in May 2024 is 91,290, 17% higher than May 2023 and 2% higher than April 2024

    • Provisional non-seasonally adjusted estimate of the number of UK residential transactions in May 2024 is 91,660, 24% higher than May 2023 and 18% higher than April 2024

    • Provisional seasonally adjusted estimate of the number of UK non-residential transactions in May 2024 is 10,130, 6% higher than May 2023 and 1% higher than April 2024

    • Provisional non-seasonally adjusted estimate of the number of UK non-residential transactions in May 2024 is 10,110, 9% higher than May 2023 and less than 1% lower April 2024

  • Lucy Harley-McKeown

    How US stocks are faring in premarket, ahead of PCE

  • Lucy Harley-McKeown

    Growth may continue into Q2, with 'consumer-led recovery'

    Here's EY Item Club's take on the potential growth path in the UK. Peter Arnold, EY UK chief economist, said:

    “Looking ahead, the EY ITEM Club expects GDP to grow at a decent pace in Q2. The composite Purchasing Managers’ Index (PMI) averaged the same level in Q2 as Q1. However, the earlier-than-usual Easter appeared to boost consumer activity in March at the expense of April, while strike action in the healthcare sector in June will likely drag on output this month. Therefore, the EY ITEM Club thinks quarter-on-quarter GDP growth will probably come in a bit softer than Q1's strong rise.

    “Further ahead, the EY ITEM Club expects low inflation and persistently strong pay growth to mean real household incomes continue to grow strongly. Provided rising consumer confidence results in households gradually moving away from the cautious sentiment exhibited over the last year, the EY ITEM Club thinks there is a prospect of a decent consumer-led recovery.”

  • Lucy Harley-McKeown

    Stocks to watch: Nike

    Shares in sportswear giant Nike sank on Friday in premarket trade, after it issued a full-year outlook that missed expectations, with revenue declining in the mid-single digits in the company’s current fiscal year. Analysts had expected growth of about 2%, according to Bloomberg.

    The company said quarterly revenue in the fourth quarter fell 2% from the year prior to $12.61bn, below Wall Street's estimates for $12.9bn. Nike's $0.99 earnings per share exceeded analysts' expectations of $0.66. Nike's direct-to-consumer sales declined 8% from the same quarter a year ago to $5.1bn.

    Shares were trading as much as 13% lower in premarket. The news also hit London-listed JD Sports (JD.L) which was among the top fallers in the FTSE 100.

  • Lucy Harley-McKeown

    European stocks at the open

    Here's how Europe's biggest indexes are faring:

  • Lucy Harley-McKeown

    GDP commentary: Why construction lagged

    Rohit Kohli, director at The Mortgage Shop said:

    "The construction sector's 0.6% drop in Q1 2024 is a massive red flag. Bad weather and less new work played a part, but so did the Bank of England keeping interest rates on hold even though inflation was returning back to target.

    "To top it off, even in this election campaign, none of the political parties have come up with real plans to tackle the housing crisis. This isn't helping anyone. Looking forward, things are still up in the air, depending on economic stability and some clear policy moves from the next government. One positive is that mortgage rates are now edging down."

  • Lucy Harley-McKeown

    Overnight in Asia

    Asian stocks regained steam on Friday after indexes saw heavy losses in the session before. Japan's Nikkei (^N225) was 0.6% higher, gaining steam off the back of a CPI report that showed underlying inflation remains weak. The Nikkei is set to add 3.2% in June.

    Chinese stocks also gained, with the Hang Seng (^HSI) up 0.1% in the session and the SSE Composite (000001.SS) rising 0.6%.

  • Lucy Harley-McKeown

    US trade on Thursday

    US stocks were little changed on Thursday as investors assessed fresh economic data ahead of an inflation reading key to Federal Reserve policy.

    The S&P 500 (^GSPC) rose nearly 0.1%, edging back toward an all-time high. The Dow Jones Industrial Average (^DJI) also rose about 0.1%. Meanwhile, the tech-heavy Nasdaq Composite (^IXIC) led the gains, gaining 0.3%.

    Memory maker Micron's (MU) shares slid more than 7%, dragging chip stocks. Nvidia (NVDA) was down nearly 2%, reviving worries of a return to the sell-off that rattled markets last week.

    Investors were weighing a new batch of economic data ahead of the PCE inflation print on Friday that will influence the Fed's thinking on the timing of interest rate cuts.

  • Lucy Harley-McKeown

    UK GDP outperforms estimates in Q1; but construction sector lags

    Here are the top lines:

    The UK economy grew 0.7% in the first quarter, according to data. The figures were revised up from an earlier estimated increase of 0.6%, according to the Office for National Statistics.

    In output terms, services — businesses like hairdressers, banks, and hospitality — grew by 0.8% on the quarter with widespread growth across the sector.

    Elsewhere the production sector grew by 0.6% while the construction sector fell by 0.6%.

    Read more on Yahoo Finance UK

  • Lucy Harley-McKeown

    Good morning

    Good morning from London. We've already had the UK GDP reading — we'll be looking ahead to the US PCE inflation data later on today, too. FTSE 100 futures are pointing to gains at the open. Let's get to it.

Watch: Why interest rates matter to bonds, stocks and cash