This morning Europe is picking up from the negative mood seen in New York yesterday and it’s a sea of red across the boards. The FTSE is down 0.5 per cent with similar falls seen in Paris and Frankfurt. It’s a very risk-off move with gold rising back above the $4,000 mark. There’s a lot for markets to digest at the moment with the Trump-Xi meeting, mixed signals from the Fed, updates from the world’s largest company and a lot of share buying earlier in the week, so this could be some profit taking too.

Yesterday, the S&P 500 fell 1 per cent and the Nasdaq 1.6 per cent, as some of the shine fell off the tech trade, with Meta’s lacklustre update doing enough to overpower Apple’s buster earnings update. However, since the market closed on Thursday, Amazon published its update, and the shares are up 13 per cent in after-hours trading, so while it’s a sea of red in Europe, and it was yesterday in New York, futures show the S&P rising in a few hours, and the Nasdaq could open as much as 1.2 per cent higher.

It’s a damp end to the month for Europe, though, where there isn’t any real impetus to keep the markets going. After last week, which was incredibly positive for the FTSE, this week’s yo-yo has taken the sting out of the positivity. The blue chip index is still up 4 per cent for the past month, but based on vibe, it should have been a lot higher than that, especially when you think that most of that has come from the miners, even though their shares dipped in the final week. It speaks to the industrial influence on the FTSE versus something like the S&P 500, which, while broader in terms of numbers, is naturally led by tech.

But there are cracks forming in the tech trade too. Amazon is up 12 per cent, Meta was down 10 per cent, and Nvidia fell 2 per cent yesterday because investors didn’t actually get any more details on the Blackwell chip exports to China, despite bidding the shares up the day before on that topic. Apple’s having a great time, as is Alphabet, but there’s so much AI capex going on, investors will need results.

By Taha Lokhandwala