The big banks kicked off earnings season on Friday, with JP Morgan, Citi and Wells Fargo starting the profits announcements on a relatively positive note. Some key players due to announce their earnings this week include Tesla, Netflix, ASML, Johnson & Johnson, Phillip Morris and Schlumberger. As these are spread across different sectors, from tech to construction, the week could be a turbulent one, not just for understanding the effects of the current economic climate on these major companies, but also for market sentiment in the coming months.
It was announced over the weekend that China’s economic growth increased in the second quarter of the year by 0.8%, which exceeded most analysts' expectations. However, markets were subdued on the back of the news, as the economic growth of 6.3% is still down compared to last year. The Chinese Yuan also fell on the back of the news, which many believe the Central Bank in China will be relatively happy about, as a weaker Yuan could stimulate some much needed economic growth.
Elon Musk, the CEO Twitter, announced in a Tweet that the company had lost nearly 50% of revenue usually generated by advertising. The silver lining is that whilst June had been a rough month, July was looking “a bit more promising”. Having been bought by Musk in October for $44 billion, the company is in a situation of high debt and negative cash flow. With rival Threads by Meta popping up, Twitter has a lot of work to do.
Sources: IG, AJ Bell, The Guardian, Reuters, Financial Times, BBC