FTSE 100 sinks but Magnificent 7 supports Wall Street

Indices are generally lower on both sides of the Atlantic but at least big tech is helping US indices avoid deeper losses, says Chris Beauchamp, Chief Market Analyst at online trading platform IG.

European markets sink into the red

Stocks in Europe have fallen victim to further profit-taking this afternoon despite the passage of Trump’s tax bill in the House of Representatives. Such progress on a deal might normally be seen as a positive, but the worsening US debt situation continues to drive higher yields in bonds and wariness among the investing community. Weakness in a host of consumer-related names in London, from housebuilders to retailers, shows that worries about the health of this key part of the economy are bubbling back to the surface.

Tax bill progress fails to lift Wall Street 

An absence of new trade ‘deals’ and continues worries about the US’ fiscal trajectory mean that optimism remains hard to find on Wall Street. Fortunately the early part of the session has seen some healthy buying in most of the Magnificent 7, providing further signs that risk appetite hasn’t dissipated entirely. Nvidia’s earnings loom large in next week’s calendar, providing a final pivotal moment as Q1 earnings season winds down.