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MONDAY 17th JUNE

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Broadcom’s earnings and British interest rates

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Broadcom's earnings beat expectations

Last week, chipmaker Broadcom made headlines as it is on course to "join the trillionaires club," according to Bank of America, which raised its price target by 34%. Broadcom's shares soared 13% after surpassing earnings expectations and announcing a 10-for-1 stock split. Analysts are recommending buying the stock following the company's latest earnings report. Broadcom, a leading semiconductor company, is a key player in artificial intelligence, networking equipment, data centers, software, and telecommunications. The stock has risen 75.7% in the past 12 months and nearly 37.8% since the start of the year.

Britain’s interest rates

This week could shed some light on where Britain’s interest rates are headed and when, as the latest UK inflation figures will be released on Wednesday, followed by the Bank of England's interest rate announcement on Thursday. Economists expect May's inflation rate to fall to the Bank of England’s (BoE) 2% target for the first time since July 2021. However, inflation is predicted to rise again in the second half of 2024 to around 2.5%. Despite slowing inflation, April's figures showed higher-than-expected rates. Consequently, the BoE is unlikely to lower interest rates from their 16-year high this week. Economic data indicates a stalled recovery and rising unemployment, leading traders to anticipate rate cuts in September and December.

Nasdaq's New Heights

The Nasdaq-100 hit all-time highs every day last week, closing with another record. As a tech-heavy index, it reflects the strong performance of tech companies driving the U.S. market. Consequently, the Nasdaq-100 has outperformed other American indices, while European markets collectively declined, lagging behind in the tech sector.

Sources: Finimize, CNBC, Euroinvestor. 

Nina Dahl