UK markets open flat after yesterday’s strong rebound
Lloyds may be looking to cut 1500 roles
US stocks rebound after two-day losing streak
Market reaction to Salesforce guidance a little overblown
Oil weighed down by oversupply concerns
Matt Britzman, senior equity analyst, Hargreaves Lansdown:
“Markets are largely shrugging off US tariff drama this morning, as President Trump heads to the Supreme Court in a push to confirm the legality of his tariff storm. The FTSE 100 was broadly flat at the open after yesterday’s 0.6% rebound. That bounce followed Tuesday’s sharp drop – the worst since April – sparked by a global bond selloff that drove UK 30-year yields to their highest since 1998. For now, gilt volatility remains the key risk to watch as investors look ahead in search of fresh catalysts.
Lloyds is making headlines after reports that it plans to embed a “high-performance culture” by cutting the bottom 2.5% of staff – around 1,500 roles – as part of a broader efficiency push. With annual staff turnover at just 5% versus a more typical 15%, it’s been forced to take a more aggressive approach to weed out the lower performers. This seems like sensible business and aligns with the banks quiet push to offshore more roles, aiming to hire 4,000 people in its India tech hub by year-end. If it can match peers like NatWest and Barclays on offshoring and branch reductions, the cost improvements could drive meaningful profit upside.
Wall Street found its footing overnight, with the S&P 500 up 0.5% and the Nasdaq jumping 1% as mega-cap tech led a rebound. Alphabet surged 9% to a record high after an antitrust ruling proved less severe than feared, while Apple added nearly 4%, helping offset weak breadth elsewhere. Rate-cut bets north of 95% and softer job openings data pushed yields lower and stocks higher. But the late-session rally didn’t look overly convincing, keeping Friday’s jobs report firmly in focus.
Salesforce shares slid about 6% after-hours as guidance underwhelmed, despite a solid second-quarter beat. The outlook implies around 9% revenue growth over the coming quarters, marking a slight slowdown and giving bears fresh ammo amid mounting fears that the software sector is ripe for disruption and questions over whether incumbents can fully monetize AI. Still, the sell-off looks harsh – AI adoption metrics remain encouraging, and if Salesforce delivers the 12% earnings growth expected for 2026 then the depressed shares offer meaningful upside.
Brent crude oil is hovering near $67 this morning, extending losses as traders brace for a potential OPEC+ supply boost. Reports suggest the group may start unwinding supply cuts – about 1.6% of global demand – in a bid to claw back market share, adding to bearish pressure from surprise US inventory builds and softer economic data. With demand signals weakening and supply risks rising, the near-term tone for oil looks firmly on the defensive.
