Brent oil enters a bear market, U.K. grows for the tenth quarter in a row and Twitter earnings due after the close. Here are some of the things that people in markets are talking about this morning.
Oil enters a bear market
Brent closed on Monday in London 20 percent below the peak it reached in May to meet the common definition of a bear market. Despite the recent drop, there is no sign of tightening supply with U.S. and OPEC production continuing to pump record output.
Big oil companies hit
Oil giant BP Plc reported a 64 percent decline in second quarter profit to $1.3 billion, well below the average $1.7 billion estimate of 17 analysts surveyed by Bloomberg. BP blamed the decline on $600 million in writedowns due to the conflict in Libya. Norway's Statoil beat estimates with net income excluding financial and other items falling less than expected to 7.2 billion kroner ($878 million). Shares in BP were trading nearly 2 percent higher and Statoil were up over 3 percent at 11:00 a.m. BST.
The U.K. reported its 10th straight expansion this morning with GDP growth in the second quarter reported at 0.7 percent, in line with expectations. Growth was driven by the services and the oil industry while manufacturing declined 0.3 percent during the quarter.
China's Shanghai Composite Index closed down 1.7 percent after a volatile session that saw it drop as much as 5.1 percent and gain 1 percent. Analyst Tom DeMark predicts that the Shanghai index will drop to 3200 over the next three weeks as the current sell-off mirrors the 1929 Wall Street crash.
Earnings season continues today with Merck, Pfizer and Ford reporting before the bell. Twitter Inc. is due to report after markets close, with analysts expecting earnings per share of $0.042. This is Jack Dorsey's first quarter acting as a public-company CEO and any indication of whether he intends to stay on in the role will be worth looking out for.
What we've been reading
This is what's caught our eye over the last 24 hours.
- How Goldman Sachs became a tech-investing powerhouse.
- Hedge-fund billionaires bet on London.
- Robots may not kill the labor market.
- Bloomberg politics tallies Donald Trump's wealth.
- Facebook's facial recognition software draws privacy concerns.
- Yanis Varoufakis explains himself in the FT.
- The Bank of England's excellent blog looks at drivers of long-term global interest rates.
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