What you need to know:
>Energy stocks weigh on indices as Brent oil falls more than 3%.
>Well-received earnings from BofA help limit S&P losses
>Netflix due to report second-quarter figures after the close
>China GDP growth misses forecasts
>Investors on lookout for further Trump rhetoric on EU at meeting with Putin
“There is no doubt that President Trump has been highly positive for US equity markets, which has fed through to rising global markets, but his increasingly erratic behaviour is making it very difficult for investors to work out whether he remains a friend or foe” — Rebecca O’Keeffe, head of investment at Interactive Investor.
“The first of the Faangs to report, Netflix earnings are hugely important for investors to confirm whether the outperformance of technology stocks is warranted or if the market has got ahead of itself.”
Positive quarterly earnings from BofA-Merrill Lynch and solid US retail sales data are helping to limit the fallout from a fresh slide for energy stocks as participants also watch for potential disruption from geopolitics.
Brent crude is down more than 3 per cent as worries about potential supply disruptions eased and Libyan ports reopened. Shares in oil majors are dragging on London’s FTSE 100, which is down almost 1 per cent.
Second-quarter earnings from Bank of America have been well-received, with its shares up 2.2 per cent.
The S&P 500 is down 0.1 per cent from Friday’s five-month closing high. The Nasdaq Composite is also down 0.1 per cent.
Netflix is due to become the first of the Faang stocks to file its earnings later in the day. The wider group of companies — made up of Facebook, Amazon, Apple Netflix and Google’s parent Alphabet — have made some of the sharpest gains in the US stock market’s record-breaking run higher.
The dollar is retreating, looking tired after an advance to an 11-session high touched on Friday. The index tracking it is down 0.3 per cent at 94.46
With President Donald Trump meeting his Russian counterpart in Helsinki, sharp White House rhetoric toward the EU before the summit added to the uncertainty.
Frankfurt’s Xetra Dax 30 is up 0.2 per cent, while the region-wide Europe-wide Stoxx 600 is down 0.2 per cent and the CAC 40 in Paris is 0.3 per cent weaker.
The FTSE 100 is falling further — down 0.9 per cent — with its heavily weighted resource stocks taking the biggest toll. BP is down 2.4 per cent and Royal Dutch Shell is weaker by 2.3 per cent.
The CSI 300 index of China’s major mainland stocks lost 0.6 per cent after the country’s official growth data came in at 6.7 per cent in the second quarter. The GDP reading reflected the impact of an aggressive deleveraging campaign on reduced investment in infrastructure and manufacturing.
Hong Kong’s Hang Seng ticked up 0.1 per cent.
Sydney’s S&P/ASX 200 slipped 0.4 per cent, as did the Kospi in Seoul.
Markets in Japan were closed for a national holiday.
Forex and fixed income:
The euro is up 0.3 per cent at $1.1715, while the pound is 0.1 per cent higher at $1.3250. Japan’s yen is steady at ¥112.31 per dollar.
In China, the onshore renminbi exchange rate, which moves within a trading band of 2 per cent to either side of a midpoint, was steady at Rmb6.6893 against the dollar.
The yield on the 10-year Treasury is up 4 basis points at 2.87 per cent and the two-year yield is 3bp higher at 2.61 per cent. US retail sales rose by 0.5 per cent in June, in line with expectations — the fifth straight monthly increase.