The FTSE 100 reversed early losses on Thursday as traders reacted to news that Donald Trump planned to slap 25% tariffs on all EU imports and a slew of corporate updates.
European indices were heavily hit, with French CAC falling 0.4% and the Italian MIB sinking 1.3% in the first hour of trade before recovering. London’s leading index was up 0.2% at the time of writing.
Investors also assessed the impact of Nvidia’s results. The chipmaker beat estimates, but only just. The slight beat on revenue, EPS and outlook neither fired up the bulls nor gave the bears anything to chew on.
“It was another upbeat quarter from artificial intelligence (AI) chip group Nvidia, albeit at a slightly slower pace than most of the quarters in the past two years. But quarterly year-on-year revenue growth of 78% remains stunning – and guidance for the first quarter came in slightly ahead of expectations too,” said Garry White, Chief Investment Commentator at Charles Stanley.
Investors will be pleased that Nvidia’s results have been navigated successfully, as they may have proved to be a banana skin for the AI trade.
On Thursday, Rolls-Royce was the big story in London as shares soared over 14%, following the release of a bumper set of results. The company beat expectations across the board and lifted its guidance.
“Rolls-Royce continues to soar above expectations, after delivering another set of high-flying results. The group’s turnaround has been so impressive that some of its 2027 guidance has been hit two years early, causing the group to upgrade its mid-term guidance,” said Aarin Chiekrie, equity analyst, Hargreaves Lansdown.
“Revenues are being boosted by the upward trend in engine-flying hours, which are now cruising above pre-pandemic levels. But that’s just one part of the puzzle. Layoffs, contract renegotiations, process changes, and increased use of data to drive efficiencies have put Rolls on a much healthier platform. As a result, margins have moved much higher, helping to convert the increased flying hours and revenue into profits.”
Rolls-Royce has been one of the major success stories for investors since the pandemic, and today’s results suggest it isn’t about to stop delivering.
The strength of Rolls’ number was felt elsewhere in the FTSE 100, with defence stocks jumping on their coat tails.
“Strong results from Rolls-Royce helped give fellow aerospace engineer Melrose a lift, with BAE Systems also higher. London Stock Exchange Group was in demand on higher profit and a positive outlook for 2025,” said AJ Bell investment director Russ Mould.