London markets dipped on Thursday as Apple’s sales downgrade hit the U.K.’s index of 100 leading shares and added to investor worries about China’s economic slowdown.
Other stocks reliant on Chinese consumption, such as Burberry PLC BRBY, -4.49% also dropped. But there was happier news for investors in the U.K.’s battered retail sector following a positive post-Christmas update from Next PLC.
What are markets doing?
The FTSE 100 UKX, -0.36% fell by 0.2% to 6,721.73 after finishing up 0.1% on Wednesday.
The British pound GBPUSD, -0.4441% was down to $1.2579 from $1.2745 late on Wednesday in New York.
What is driving the market?
In a surprise move, Apple downgraded its sales projections to an expected revenue of $84 billion for the quarter, about 9% less than a $91.3 billion estimate from analysts polled by FactSet.
In a letter to shareholders, Apple’s CEO Tim Cook attributed the projected fall to China’s slowing economy and recent U.S. tariffs on more than $200 million worth of Chinese goods. The company’s shares fell 7.6% to $146 in after-hours trading on Wednesday.
Asian markets were mostly down as a result of Apple’s announcement.
What stocks are active?
Brands reliant on Chinese consumption, such as mining stocks and Burberry PLC, struggled on Thursday. Burberry PLC BRBY, -4.49% lost more than 4%, while in mining company Evraz PLC EVR, -4.90% declined by 4%.
In the retail sector, Next PLC NXT, +4.67% managed to survive the Christmas period and held the top spot on the FTSE 100 on Thursday, gaining 5%. Richard Hunter, head of markets at Interactive Investor, cited careful management of its finances and strong online sales as reasons for the positive performance.
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