- FTSE 100 up 25 points at 8272
- SpaceX launches succesfully
- EU cuts interest rates
4.02pm: FTSE 100 to close higher
The FTSE 100 is set to close higher for a second consecutive day, having recieved a a slight boost from Europe's Central Bank deciding to cut interest rates.
Borrowing rates were trimmed by a quarter of a percent to 4.25%, as analysts had forecast, marking the first drop by the ECB in nine years following a nine-month pause.
Top risers in the blue-chip index included Sage Group, JD Sports, Diageo, NatWest and Barclays.
Meanwhile, Vodafone, National Grid, WPP and Sainsbury all led the fallers after they went ex-dividend.
3.47pm: Bitcoin chases all-time high
Bitcoin (BTC) continued to climb against the US dollar with another 0.8% gain on the BTC/USD pair.
The world’s largest cryptocurrency is now trading above $71,000 for the first time in over two weeks as the bulls aim to reclaim its all-time high of $73,777 achieved in mid-March.
Week on week, BTC/USD has added 3.5%, bolstered by a stable exchange-traded fund (ETF) market and promising regulatory developments across the globe.
3.24pm: Salesforce opens first AI centre in capital
Salesforce Inc (NYSE:CRM, ETR:FOO) has opened its first AI Centre in London, in Southwark at the Blue Fin Building, signalling what the global CRM giant called “a vote of confidence in the United Kingdom’s AI economy”.
It forms part of Salesforce's $4 billion investment pledge into the UK’s artificial intelligence sector.
Since announcing the pledge in June 2023, Salesforce has invested over $200 million into companies including AI-powered text-to-speech software platform ElevenLabs.
ElevenLabs achieved unicorn status earlier this year following an $80 million funding round led by Andreessen Horowitz.
3.08pm: Badenoch to meet with Royal Mail takeover bidder
Royal Mail takeover bidder Daniel Kretinsky is set to meet with the UK's business secretary Kemi Badenoch to discuss the £3.7 billion deal.
Badenoch will meet with the 'Czech Sphinx' in the middle of next week, according to reports.
While the government has yet to raise any fundamental objections to the takeover, it will be reviewed under the National Security and Investment Act and could face more intense scrutiny following the culmination of the general election.
Representatives from Kretinsky's EP Group met with union bosses earlier this week to discuss the commitments being made to postal workers.
Bosses of the Communication Workers Union (CWU) said they underwent a “useful and constructive” meeting but warned the promises being made weren't strong enough.
2.49pm: Wall Street opens flat
US stocks have opened relatively flat a day, but the S&P 500 has continued to push ahead from yesterday's record highs, up 0.11% or 6 points.
Meanwhile, the Dow Jones has remained flat at 38,822 and the Nasdaq has lifted 0.18% or 30 points.
In equities, Lululemon, the sports clothing retailer, lifted around 5% after it beat Wall Street guidance with its first-quarter report.
Robinhood popped 6% following it sealing a deal to acquire crypto exchange Bitstamp for US$200 million, helping form part of the group's expansion outside of the US.
Discount store chain Five Below (NASDAQ:FIVE) dropped 15% after its sales missed analyst estimates, with the effect of inflation still dampening its performance.
2.24pm: UK growth forecasts lifted
Britain's economy will grow at a faster pace than what was initially forecast, the UK’s leading business and industry lobby group revealed.
Upgraded forecasts from the British Chambers of Commerce revealed the UK’s economy is now set to rise by 0.8% in 2024, compared to previous predictions of a 0.5% jump.
Moving into 2025, the BCC predicts the economy will expand by 1%, notching up previous forecasts of 0.7%.
Driving the lifted forecasts was a better-than-expected start to the year, with the first quarter seeing output growth of 0.6%, its fastest pace since 2022.
Growth forecasts for 2026 have been maintained at 1%.
“There is life in the UK economy but if it is to gain momentum then it must be nurtured,” Vicky Pryce, chair at the BCC’s economic advisory council said.
2.14pm: ECB still has 'room' to cut twice more this year
The ECB rate cut rate cut was as forecast but the new forecasts for inflation to remain above target may have surprised markets, but this "still leaves room for a few more cuts", says economist Claus Vistesen at Pantheon Macroeconomics.
That the ECB statement repeats the line from the March statement about the “appropriateness” of easing policy if inflation forecasts continue to signal 2% in the medium term "is a dovish surprise to us", Vistesen says, but assistance that future decisions "will ensure that its policy rates will stay sufficiently restrictive for as long as necessary", still signals the clear bias, he adds.
Upgraded inflation forecasts, where the near-term profile has been revised to well above 2% next year, "is consistent with our view that the policy rate won’t fall below 3% next year, though that still leaves room for a few more cuts", Vistesen says.
"We still see the ECB cutting in September and December, and we’re leaning towards a third rate cut in March if our Q1 forecasts hold over the summer."
The press conference is underway and there will be more reactions during and after that.
2.03pm: ECB path to future cuts now looks 'slower than anticipated'
"Any celebrations about today’s 25bp rate cut by the ECB are likely to be muted at best," says economist Andrew Kenningham at Capital Economics, "given that the decision was fully discounted by financial markets and the most recent inflation and wage data have dampened expectations for a rapid easing cycle."
He says, the bank’s forecasts and statements are "slightly hawkish", ie do not imply lots more rate cuts.
The market focus is on the ECB’s revised economic forecasts and policy guidance, with headline and core inflation expected to average 2.2% next year rather than 2.0% and 2.1% respectively.
"This implies that the future path of rate cuts may be a little slower than previously anticipated," says Kenningham.
"At the press conference, President Lagarde will give little away and will not pre-commit to any further rate cuts. However, she may offer some clues about how concerned policymakers are by the stickiness of wage and services inflation."
1.58am: SpaceX Starship launch successful... so far
The super-massive SpaceX giant Starship has successfully launched on its fourth test flight, with its Super Heavy booster having achieved a 'soft splashdown' as planned.
The Starship spaceship has entered space, as its predecessor did in the third flight though it was unable to be returned to Earth.
Watch Starship’s fourth flight test → https://t.co/bJFjLCiTbK https://t.co/SjpjscHoUB
— SpaceX (@SpaceX) June 6, 2024
1.40pm: ECB forecasts hit bonds
European bond movements suggest the ECB move, or maybe just the inflation forecasts, were not fully priced in by markets.
Bond yields have risen and UK, German and French stock indices are heading lower.
ECB cut backfires: eu govt bonds yields up, spread de-us 10s narrows further pic.twitter.com/cUEByZOzdF
— jck✨ (@Alea_) June 6, 2024
Meanwhile, US weekly jobless claims are in.
The initial reading for the week ending last Saturday that claims rose to a four-week high of 229k, above the 220k expected and the prior week's 219k.
Continued jobless claims were also up, to 1.792 million from 1.791 million, beating the 1.790 million expected.
1.29pm: Inflation is down but not out, forecasts hiked
The ECB governing council said it decided to lower the three key interest rates as the time was right, due to the fall in inflation by more than 2.5 percentage points since its September meeting.
"Based on an updated assessment of the inflation outlook, the dynamics of underlying inflation and the strength of monetary policy transmission, it is now appropriate to moderate the degree of monetary policy restriction after nine months of holding rates steady."
The inflation outlook has also "improved markedly", the council felt, with underlying inflation having also eased, "reinforcing the signs that price pressures have weakened, and inflation expectations have declined at all horizons".
Monetary policy has dampened demand and kept inflation expectations "well anchored," the council said, helping bringing inflation back down, though domestic price pressures remain strong from elevated wage growth.
The next move from the ECB was not clear, as the governing council expects inflation to stay above target "well into next year", with latest staff projections for revised up for 2024 and 2025.
Headline CPI inflation is now forecast to average 2.5% in 2024 and 2.2% in 2025, with core inflation, which excludes energy and food, seen at 2.8% in 2024, falling to 2.2% in 2025.
Economic growth is expected to pick up to 0.9% in 2024 and 1.4% in 2025.
1.16pm: The ECB cuts
The ECB cuts rates as expected.
It repeats an intention to keep rates restrictive for as long as necessary to achieve its aims and repeats its data-dependent, meeting-by-meeting approach.
1.04pm: Royal Mail short bet
Just a few minutes until the ECB decision is confirmed.
Meanwhile, we've reports that Royal Mail's parent company, International Distributions Services PLC (LSE:IDS), is being shorted by a New York hedge fund.
This could be a bet on the collapse of the postal service group’s £3.6 billion takeover from Czech billionaire Daniel Kretinsky.
Sessa Capital initially reported it had opened a 0.73% net short position with IDS last Friday, just days after the board recommended the offer.
Earlier this week, the investment group upped its position to 0.83%, with analysts labelling the move "bold" but "intriguing".
12.59pm: More election tax sparring
Tory MP Laura Trott has accused Labour of "asking for a blank cheque" to raise taxes across the board this election.
Not so, shadow defence secretary John Healey told Sky News this morning. "The taxes that are most important to people – income tax, VAT and National Insurance – will not be raised under a Labour government."
But there is one field where promises are no so crystal clear: capital gains tax (CGT).
According to courses cited by The Guardian, shadow chancellor Rachel Reeves is under pressure from colleagues to commit to CGT increases, should she be the one to deliver the autumn budget...read more here.
12.47pm: Starship rocket's fourth flight test this afternoon
Starship, the giant rocket made by Elon Musk’s SpaceX, is scheduled to blast off on its fourth flight test later today.
With the launch taking place at the company's Boca Raton base on the Texas coast, the target time is 7.50am Central Time, which is 1.50pm London time.
It follows significant progress made on the previous test for the 120-metre tall rocket, which reached space but it did not successfully make it back to Earth in one piece.
Targeting Thursday, June 6 for Starship’s fourth flight test.
A 120-minute launch window opens at 7:00 a.m. CT → https://t.co/bJFjLCiTbK pic.twitter.com/jWdhCAyk8I
— SpaceX (@SpaceX) June 4, 2024
12.31pm: Swifties' economic sparks fly
Big news for financial publications, which don't get to write about pop stars much: Taylor Swift this week is kicking off the UK leg of her Eras tour, with a string of concerts which are expected to generate £1 billion for the British economy.
Fresh from her The Tortured Poets Department album release, Swift will get her tour of Britain underway at Edinburgh’s Murrayfield Stadium on Friday, Saturday and Sunday, with her frankly crazy levels of popularity expected to lead to road closures, record attendances and a horde of frenzied merchandise and other spending.
Some 220,000 fans are forecast to attend the three Edinburgh performances, with the local council warning that roads and areas near the arena would be disrupted - read more here if you like.
12.12pm: Markets tiptoeing higher
Trading in London shares remains positive at just after midday, tiptoeing higher ahead of the ECB meeting.
The FTSE 100 index up almost 35 points or 0.4%, while the FTSE 250 is up 65 points or 0.3%.
Top riser across both indices is John Wood Group PLC (LSE:WG.), up almost 10% after its board decided to engage in takeover talks with Sidara.
This followed a fourth possible offer from the Dubai-based rival at a "final price" of 230p per share in cash.
Wood's board said that while it "remains confident" in the current strategy and prospects, "having now weighed all relevant factors including, in particular, feedback received from Wood shareholders, the board has decided to engage with Sidara to determine if a firm offer can be made".
Sidara is being given access to the books to carry out due diligence and the put-up-or-shut-up (PUSU) deadline has been extended to 5pm on 3 July.
The biggest faller is Vodafone, down as its shares go ex-dividend, along with several others.
12.05pm: ECB 'should not cut rates'
The ECB should not cut rates, reckons Alberto Matellán, chief economist at Mapfre.
Economic data does not support a rate cut, as the "persistence of inflation, together with the improvement in growth data we’ve seen in recent quarters, means that the lowering of rates in Europe isn’t justified," he says.
"The macro situation in Europe doesn’t justify rate cuts, certainly not a cycle of them. We have growth, weak as it is, and it’s beginning to improve. There are other nuances, such as financial stability, but looking at the macro data, this isn’t justified."
As other economists have said, what comes after this first small cut is almost more important, as one quarter-point reduction won't move the economic dial much, and as Matellan suggests, a big move is not warranted.
Comments at the meeting might give a clue.
11.56am: White House Gaza statement
The White House has issued a joint statement from the leaders of the US, Argentina, Austria, Brazil, Bulgaria, Canada and others on Gaza, calling on Hamas to move towards a ceasefire and hostage-release deal.
"As leaders of countries deeply concerned for the hostages held by Hamas in Gaza, including many of our own citizens, we fully support the movement towards a ceasefire and hostage release deal now on the table and as outlined by President Biden on May 31, 2024," the statement says.
"There is no time to lose. We call on Hamas to close this agreement, that Israel is ready to move forward with, and begin the process of releasing our citizens.
"We note that this agreement would lead to an immediate ceasefire and rehabilitation of Gaza together with security assurances for Israelis, and Palestinians, and opportunities for a more enduring long-term peace and a two-state solution."
The price of gold, which has risen from $1800 per oz before the Hamas attack in October to $2400 is little moved today at $2360.
Oil prices, which have been up and down in that period, are up slightly today, with Brent crude futures rising 0.36% to $78.69 a barrel.
11.50am: Blackout risk lessens, green investment increases
Ahead of the ECB announcement, most European markets are moving largely sideways after initially starting higher, including the Footsie.
Meanwhile, National Grid’s Electricity System Operator (ESO) has published its outlook report, showing reduced risks of blackouts this winter, with a 9.4% margin between expected capacity and demand, up from 7.4% last winter.
"Rebalancing in European energy markets has further reduced the risk of fuel shortages for gas generation in Great Britain and increased the resilience of interconnector imports to supply-side shocks,” the ESO said.
Elsewhere in the energy market, the International Energy Agency has forecast that worldwide investment into low-carbon energy is expected to be double that of fossil fuel power, having overtaken climate-damaging energy for the first time last year.
A spike in solar project spending is expected to be the main engine of growth, as $2 trillion of cash is beamed into clean energy, which includes sectors such as renewables, nuclear power, electric vehicles, heat pumps, and energy storage.
11.23am: Shein push-back from fund managers
UK fund managers have expressed concerns about supporting fashion company Shein's potential flotation in London due to allegations about its treatment of workers, according to a report this morning from the Financial Times.
Recent indications have suggested the $66 billion Chinese online fashion company is seeking to list in London after getting pushback in the US from its hoped-for IPO in New York.
While a London IPO could potentially help revive a dormant market in the Square Mile, leading UK institutional investors are hesitant to invest due to allegations of forced labour in Shein's cotton supply from Xinjiang. Shein has denied these claims.
"It’s a tricky one," one UK fund manager told the paper. "I don’t think anyone with an ESG team will be able to buy it. It smacks of desperation for the London Stock Exchange — they’ll take anything." He added that there is a risk of "collateral brand damage" for the LSE.
A Shein spokesperson stated the company has a zero-tolerance policy for forced labour and is committed to respecting human rights.
11.10am: Super-rich pack up to avoid election tax hikes
Bloomberg is reporting that wealthy UK residents, including foreign billionaires and City bankers, are "rushing to shelter their money" following Rishi Sunak's snap election call.
Some are cashing in investments, paying off bills that may soon rise or leaving the UK entirely, the report suggests, having interviewed over 20 high-net-worth individuals and wealth advisers.
10.55am: UK publishers' Google trial to proceed
An interesting story I missed yesterday, a potential £13 billion-plus claim by UK publishers against Google over its "anti-competitive" advertising technology has been permitted to move to trial.
The claim alleges that Google abused its dominant position in the adtech market, causing billion of pounds of losses for UK publishers.
London’s Competition Appeal Tribunal yesterday certified the claim to allow it to go to trial, dismissing Google’s arguments - thats via the Press Gazzette.
10.49am: ECB preview
The European Central Bank decision is due just after 1pm today.
Here are the thoughts of a couple of economists (read more here).
After the Bank of Canada followed recent moves by the Swiss National Bank and Sweden's Riksbank in making the first interest rate cuts since the pandemic, Simon French at Panmure Gordon says Ottowa has made it easier for its European counterparts.
"Moving as a herd is an attractive feature for central bankers privately worried about being labelled the Jean-Claude Trichet of this economic cycle.
"The BoC has just made that task easier for its European counterparts," says French.
Francesco Pesole at ING says with a cut almost guaranteed and fully priced in by markets, the attention will be on communication.
And while there are risks for the euro, he doubts this will be a huge event for FX.
"Unless President Lagarde revamps some of her eloquence (she has seemingly made press conferences intentionally uneventful), then the FX market may be left with more questions than answers."
There's also a meeting later in the day at Denmark's central bank, whose mandate is to keep stability in the EUR/DKK exchange rate, so it will likely cut rates by the same 25 bps a few hours after the ECB.
10.35am: Sunak claim investigated
The UK Statistics Authority has launched an investigation into a statement by Rishi Sunak that the economy is "going gangbusters" and that parties could misuse economic data in election campaigning.
Robert Chote, chair of the statistics watchdog, said the body will scrutinise whether the prime minister's comments exaggerated the Tory’s economic performance.
Sunak used the "going gangbusters" phrase after it had been used by an ONS official in a media briefing, making the Daily Mail front page.
UK GDP growth was 0.6% in the first three months of the year, following a shallow recession in the second half of last year, with a decline of 0.3% in the fourth quarter after a 0.1% fall in the third.
10.22am: EU retail sales
Europe retail sales were down 0.5% month-on-month in April, worse than the 0.2% expected decline and after an increase of 0.7% the month before.
Compared to the previous year, sales were flat, which again was lower than an expected 0.1% rise, easing from the previous month's 0.7% growth.
10.05am: UK shares tick higher
Momentum is positive in the FTSE 100 index, with all but three of the top 20 largest stocks in green this morning.
But with ex-divs holding the index back a little, the gain is small, up 0.2% so far, while the FTSE 250 is up 0.4%.
A Nvidia-led storming run for the Nasdaq last night and the prospect of interest rate cuts in Europe today "have all combined to put investors in a good mood," says Russ Mould, investment director at AJ Bell, saying we're now "beginning the next phase in the cycle".
"The ECB is expected to follow the likes of Canada, Sweden and Switzerland by cutting rates later today, bringing the long-awaited pivot in monetary policy and signalling the start of a new era.
"After a long period of rock-bottom rates, the subsequent period shocked markets to the core as interest rates soared amid high levels of inflation.
"We’re now beginning the next phase in the cycle where inflationary pressures ease and central banks move to a new playbook to help prop up a flagging economy and make life easier for consumers and businesses who have had to stomach sky-high borrowing costs."
The Federal Reserve meeting comes next week (and Bank of England the week after), and while they might have given the impression they aren’t swayed by what the ECB and other countries do, "the greater the number of central banks cutting, the more pressure they will be under to do the same", says Mould.
On the FTSE's top riser, Antofagasta and its deal to improve the water supply at a copper project in Chile, Mould says: "Mining is a risky industry and anything a company can do to lower the risks is a positive for investors. Ensuring a smooth supply of water is important, particularly when a mine is in a remote or difficult to access location."
9.41am: Construction survey beats consensus
A couple of bits of macro data have just come out.
The UK construction PMI for May came in stronger than forecast at 54.7, up from 53.0 a month earlier and beating the 52.5 consensus estimate.
The Bank of England's monthly decision maker panel (DMP) survey for May finds UK businesses see year-ahead CPI at 2.9%, flat from the last count.
They also see output price inflation easing to 3.9% from 4.0% while businesses see year-ahead output wage growth easing to 4.5% from 4.8%.
The DMP survey gathers views from chief financial officers from large, medium and small businesses, which the BoE says it uses to monitor developments in the economy and to track businesses’ views.
9.09am: Big UK automotive order for US autonomous vehicles
Shares in Strip Tinning (AIM:STG), a maker of automotive components, had revved up more than 60% earlier after a large German auto group selected it for a "major high volume strategic nomination" for autonomous vehicles being developed by a huge US company.
It described the client as a "leading German automotive motion technology Tier 1 manufacturer", while the contract nomination is for the supply of cell contact systems for the battery pack modules.
The vehicle manufacturer is said by the AIM-listed company to be "owned by one of the world's largest corporations and is currently running trials on public roads in three US cities".
This seems to point to Waymo, owned by Alphabet Inc (NASDAQ:GOOG), Google's parent company.
8.52am: N Brown back in the black
It's a pretty quiet day in terms of blue-chip corporate results, but there's some mid-cap numbers out, including from Jacamo and SimplyBe owner N Brown Group PLC (AIM:BWNG), where the shares are up 20%.
The finals results from the struggling home shopping group N Brown are "nothing to shout about", says independent retail analyst Nick Bubb, with total revenue down 10%.
But adjusted EBITDA, while nearly 13% down, are above market expectations and that the company has returned to statutory profits.
CEO Steve Johnson trumpets that "we have delivered against our strategic and financial objectives this year”, while also saying that in current trading, the rate product revenue decline "has moderated", with Q1 declining by 6% and "this improvement is expected to continue as the year progresses".
8.44am: European markets up ahead of ECB decision
Ahead of the ECB meeting later, the FTSE's small gain is being eclipsed by those on the European mainland, with the ex-dividend stocks weighing on the UK market.
The FTSE 250 is up 66 points at 20,730.
In Europe, the DAX is leading with a 0.81% rise, France's CAC 40 up 0.40%, Spain's Ibex 0.37% and Italy's FTSE MIB ahead 0.24%. The wider Stoxx 600 has risen 0.58%.
8.33am: Can anything stop Nvidia?
A stunning fact is that, in just two years, Nvidia's market cap has increased more than 600%, with the chipmaker’s valuation rocket past Netflix, past Tesla, past Google, Broadcom, Amazon and Meta, to also overtake Apple in the past 24 hours.
As of this moment, Nvidia is valued at $3.01 trillion versus Apple’s measly $3 trillion.
The gap is expected to widen even further when US markets open today, with pre-market trades pointing to a 0.95% gain on Nvidia stock and a 0.17% loss on Apple stock, writes my colleague Billy Farrington as he takes a look at the meteoric rise of the semiconductor innovator.
8.27am: Modestly positive market sentiment
Positive stock market sentiment has been rekindled after an erratic May, says Richard Hunter, head of markets at Interactive Investor.
Investors will remain on "high alert" for further economic developments unfolding, he adds.
In the year to date, the FTSE 100 is up 6.7%, Nasdaq is ahead by 14.5% and the S&P 500 by 12.2%, Germany's Dax has risen around 11.6% and Japan's Nikkei jumped 16.3%.
Focusing on this morning, Hunter says: "The London market edged higher at the open, with tentative buying interest in the mining sector offsetting some of the more recent weakness across oil and commodity prices in general.
"Such weakness has tempered gains in the FTSE 100 after a record-breaking level was reached in May ... and despite the uncertainty of an imminent general election, the more domestically focused FTSE 250 has reversed early year losses to stand up by 5.3% in the year to date, latterly propelled by a UK economy which is seeing some benefit from easing inflation and the possibility of lower interest rates, in addition to recently having left a short and shallow technical recession."
He says the appetite for tech stocks is also driving many global indices higher.
"The likelihood of an interest rate cut later today from the ECB also boosted sentiment, potentially signalling a new era of easier monetary conditions across the globe," Hunter adds.
8.16am: FTSE reshuffle confirmed
In the UK, the FTSE index reshuffle was confirmed last night, involving three demotions from the blue-chip index, with LondonMetric Property, Vistry Group and Darktrace (temporarily as it is being taken over) replacing Ocado, RS Group and St James's Place.
Dropping out of the FTSE 250 into the small caps will be Ferrexpo, Mobico Group (National Express) and Octopus Renewables Infrastructure Trust, replaced by Alpha Group International, Renewi and XPS Pensions Group.
8.08am: FTSE starts higher, ex-divs weigh
The FTSE 100 is ambling higher, as predicted, rising 12 points or 0.15% to 8259 in the first few minutes of trading.
Top risers initially are copper miner Antofagasta, up 2.5% after a deal to improve the water supply at a copper project in Chile, and precious metals miner Fresnillo, though it's not immediately clear why.
Burberry and Rolls-Royce are next.
Vodafone is the big faller, down 5.8% after going ex-dividend.
Other ex-div fallers include WPP, Informa, Sainsbury and National Grid.
7.56am: More weak data from Germany
After recent data showed German inflation and unemployment claims increasing, this morning we hear that factory orders in Germany fell by 0.2% month-to-month in April, below the consensus for a 0.6% increase after a revised 0.8% decline in March.
The year-over-year rate improved to -1.6%. Net revisions to the month-to-month data were down 0.4%.
"This was a good deal weaker than we expected," says economist Claus Vistesen at Pantheon Macroeconomics, but the headline number was held back by a big fall in major orders that masks a 2.9% jump in core orders, which is more in line with forecasts.
7.49am: Regulator calls for scrutiny of AI sector
In a big tech story after the barnstorming Nvidia performance last night, there are reports that a major US investigation is brewing into the three major players in AI.
The New York Times reports that the US Justice Department and the Federal Trade Commission have reached a deal that allows them to proceed with antitrust investigations into the dominant roles that Microsoft, OpenAI and Nvidia are playing in the industry.
The two regulators have reached a deal to split responsibility for investigating the three major players in AI.
US antitrust watchdog also says "urgent scrutiny" is needed over big tech’s control of AI, according to a Financial Times story, where Department of Justice chief Jonathan Kanter says he is examining "monopoly choke points and the competitive landscape" in AI, covering aspects from computing power and data utilised for training large language models to cloud service providers, engineering talent, and essential hardware like graphics processing unit chips.
Regulators must act "with urgency" to prevent dominant tech companies from monopolising the market, he says, though he suggests a "real time" intervention can be "less invasive" for industries.
7.31am: Fever-Tree mixes top line gains with market growth
Fevertree Drinks (AIM:FEVR) said it remained "comfortable with full year expectations", reporting market share gains and topline growth.
Ahead of its AGM, the company issued a statement to say that it anticipates a strong summer trading period with new marketing initiatives.
In the UK, Fever-Tree has solidified its leading position, especially in the rum, vodka and cocktail mixer categories, while in the US it boasted that its products continue to be "the biggest contributor to growth within the carbonated mixer category", while also growing ahead of the market in Europe.
7.14am: Positive start expected for FTSE 100
The FTSE 100 is expected to hit the ground jogging on Thursday, after a strong finish on Wall Street overnight and ahead of the European Central Bank meeting later today.
Spread-betters have tipped the London benchmark to add 15 points this morning, adding to the 15 it made yesterday to finish at 8,246.95.
Last night Nvidia rocketed 5% to a new record higher, leading a tech melt-up, as the Nasdaq Composite index surged 1.95% and the S&P 500 jumped 1.18%, with the Dow Jones rising a more humdrum 0.25%.
Nvidia's continued ascent, up 154% this year, meant it topped a $3 trillion market cap and overtook Apple to become the second largest company in the world by market valuation.
Driving the mood yesterday were various factors, including weak ADP data and Canada's central bank cutting rates.
Lower yields boosted appetite in global indices, said market analyst Ipek Ozkardeskaya at Swissquote Bank. "The Canadian TSX rebounded past its 50-DMA, the European SXXP jumped while the S&P 500 was catapulted to a fresh record for the 25th time this year.
"Yes the S&P 500 renewed record 25 times since this year started – regardless of the fact that we spent most of the year scaling back the Fed cut bets and are still not sure if the Fed will be able to cut rates this year at all."
Yesterday Goldman Sachs predicted a "wall of money" from passive equity allocations will pour into the stock market in early July, setting up a rally through the early summer.