Amazon Drops 6% After Earnings Miss Expectations

Amazon shares fell 6% in after-hours trading following disappointing earnings, weighing on Nasdaq futures, which slipped 0.2% ahead of Friday's open. President Trump imposed fresh tariffs on dozens of countries, including 35% on Canada and 39% on Switzerland, though markets responded calmly, with Euro Stoxx 50 futures down just 0.3%. The US dollar is set for its strongest week in nearly three years, rising 2.5% as a hawkish Federal Reserve held off rate cuts amid inflation concerns.

Equities

The FTSE 100 slipped 0.05% on Thursday, but still ended July with its strongest monthly gain in six. Shares in Rolls-Royce rose 8.5% to a record high after the company raised its full-year operating profit and free cash flow outlook, supporting a 5.1% rise in the aerospace and defence sector.

Shell added 1.2% after second-quarter profit fell nearly a third but still beat forecasts. British American Tobacco gained 1.3% after first-half profit topped expectations, while St James’s Place jumped 11.9% on the FTSE 100 after reporting a doubling in net inflows and announcing a new share buyback.

Rentokil climbed 9.5% after posting 3.1% revenue growth for the first half and maintaining its full-year guidance. However, packaging firm Mondi dropped 12.1% after a 17% decline in first-half pretax profit.

London Stock Exchange Group fell nearly 8% following slower growth in recurring revenue. Just Group surged 67.5% to the top of the FTSE 250 after Canada’s Brookfield Wealth Solutions agreed to buy the company in a £2.4 billion deal.

In the US, the S&P 500 fell 0.37%, the Dow lost 0.74% and the Nasdaq slipped 0.03% on Thursday. Early gains faded following inflation data and earnings from major firms.

Microsoft rose 3.5% after strong results helped the company briefly cross the $4 trillion market capitalisation mark, joining Nvidia as only the second US company to do so. Meta Platforms jumped 11.3% to a record $773.44 after a bullish forecast driven by AI-led strength in its core advertising business.

Semiconductor stocks dragged on the broader market. Broadcom fell 2.9% and Nvidia slipped 0.8%, pushing the PHLX semiconductor index down 3.1%—its largest drop since mid-April. After the closing bell, Amazon fell 2.6% in extended trade following its quarterly earnings release.

Drugmakers came under pressure after the White House said President Trump had written to 17 pharmaceutical CEOs urging them to cut prescription drug costs. The NYSE Arca pharmaceutical index dropped 2.9%, its fourth straight decline.

Forex & Commodities

The US dollar rose 0.26% on Thursday to 100.05, supported by inflation data and growing expectations the Federal Reserve may delay any rate cuts. Against the yen, the dollar climbed 0.84% to 150.76 after the Bank of Japan held interest rates steady and raised its inflation forecast. The euro edged up 0.08% to $1.1413, while the Korean won weakened 0.21% following new 15% US tariffs on South Korean goods. The Mexican peso gained 0.23% after being granted a 90-day tariff reprieve by the US.

The dollar index is set for its first monthly gain of 2025, lifted by signs of economic resilience and investor demand for clarity ahead of new US tariffs that came into effect on Friday. President Trump imposed duties ranging from 10% to 41% on imports from dozens of countries, with Canada seeing tariffs raised to 35% on all non-USMCA-covered goods. Mexico was given until October to agree broader trade terms.

Gold rose 0.2% to $3,299.08 per ounce on Friday, helped by tariff uncertainty, although it remains down 1.2% this week due to dollar strength. US gold futures gained 0.1% to $3,351.60. Spot silver was down 0.1% to $36.69, platinum rose 0.4% to $1,295.76 and palladium gained 1.1% to $1,203.72.

Brent crude was flat at $71.74 per barrel and US West Texas Intermediate was little changed at $69.27. Oil fell more than 1% on Thursday after a surprise rise in US crude stocks and concern that higher tariffs will weigh on demand. However, gains earlier in the week leave both benchmarks on track for weekly increases.