Highlights
- FTSE 100 set to open 38 points lower
- Asian markets lower as tech sell-off continues
London set for lower start
The FTSE 100 looks set to open 38 points lower after another sell-down of tech stocks in Asia as investors digested the impact of the 'bluewash' midterm defeat for the Republicans.
Market focus is now on the AI trade with Democrats holding sway in both houses, raising the prospect of tighter tech regulation.
Here in London, there is a dribble of big cap news, led by Marks & Spencer, which should be provide a decent proxy for high street confidence.
Asian markets fall as US midterm result hits AI trade
Asian markets were mostly lower on Wednesday as investors assessed the US midterm election results and their potential impact on artificial intelligence investment and regulation.
Japan’s Nikkei 225 was down around 1.4%, while South Korea’s Kospi fell 0.5% and Hong Kong’s Hang Seng lost 0.3% by early afternoon Australian time.
Technology-heavy markets remained under pressure amid concerns that stronger Democratic gains in the US could lead to tighter scrutiny of data-centre development and AI infrastructure spending.
The Financial Times said Democratic victories in key US states had raised concerns that new data-centre construction could slow, with Nasdaq 100 futures falling around 0.7%.
Australia extends losses
Australia’s S&P/ASX 200 was down around 0.6% at 8,832, with financial and healthcare stocks among the main drags after the Reserve Bank of Australia raised the cash rate to 4.85% on Tuesday.
The Australian dollar was broadly flat around US69.7 cents.
Tech remains the key pressure point
The regional weakness came despite a firmer finish for parts of Wall Street overnight, where the Nasdaq Composite gained 0.8% and the S&P 500 rose 0.4%, while the Dow Jones slipped 0.4%.
Investors remain wary that the recent AI-led rally has left technology valuations stretched, while rising bond yields are also adding pressure to growth stocks.
Oil edges higher
Brent crude futures were up around 0.8% at US$104.47 a barrel, while gold added 0.3% to about US$3,940 an ounce.
Iron ore was also firmer at around US$91.55 a tonne.
Attention remains on the final US midterm outcome and whether the result changes expectations around fiscal policy, technology regulation and data-centre investment.
