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FTSE falls and Wall Street rises as Twitter taken off New York Stock Exchange

 

Twitter logo and a photo of Elon Musk. FTSE was down on Friday but Wall Street rose
Elon Musk became the new owner of the social media platform after a US court had set a deadline of Friday for the billionaire boss to complete his $44bn acquisition. The FTSE was down on Friday. Photo: Dado Ruvic/Reuters

The FTSE 100 (^FTSE) underperformed against its continental peers and Wall Street on Friday, as a filing with the US Securities and Exchange Commission confirmed that Twitter's (TWTR) shares had been taken off the New York Stock Exchange (^AMZI).

Elon Musk became the new owner of the social media platform after a US court had set a deadline of Friday for the billionaire Tesla (TSLA) boss to complete his $44bn (£38bn) acquisition.

On Friday morning Musk fired top executives that he had accused of misleading him in his purchase, including chief executive Parag Agrawal, chief financial officer Ned Segal and legal affairs and policy chief Vijaya Gadde.

Musk, who plans to take on the role of chief executive, tweeted "the bird is freed" on completion of the deal.

However, Thierry Breton, EU internal market chief, shot back at Musk on Twitter, saying: “In Europe, the bird will fly by our rules.”

Read more: Elon Musk could become global 'punching bag' as he takes Twitter private

According to reports, Musk will abolish permanent bans on users as he does not believe in lifelong suspensions. This means the potential return of previously banned individuals such as Donald Trump, Katie Hopkins and Kayne West.

Former US president Trump said he was “very happy” that the social media company will “no longer be run by Radical Left Lunatics and Maniacs that truly hate our country”.

He added that Twitter needed to “work hard to rid itself of all the bots and fake accounts that have hurt it so badly”.

London's benchmark index was 0.4% lower on the day as worries over widening COVID restrictions in China dragged commodity stocks. In Paris, the CAC (^FCHI) rose 0.5% and the DAX (^GDAXI) was 0.2% higher in Germany.

Traders were also spooked by reports of an expansion of the windfall tax on energy firms, while prime minister Rishi Sunak said "tough decisions" were needed to fix the British economy.

On Wall Street, the S&P 500 (^GSPC) rose 1.6% by the time of the European close, and the tech-heavy Nasdaq (^IXIC) climbed 1.8%. The Dow Jones (^DJI) edged 2% higher.

It came after Amazon (AMZN) warned of weaker consumer spending on Thursday in the run up to Christmas after its tech peers also posted weak trading updates. Shares were down 10% on the day.

Read more: Amazon stock tanks 20% after revenue and guidance miss expectations

The online retailer missed Wall Street expectations as it revealed revenues of $127.1bn (£110.29bn) for the three months to September. It said it expected earnings over the final quarter around the festive season to be between $140bn and $148bn, coming in below analyst estimates of $155.5bn.

The miss was partly blamed on currency effects, thanks to a strong US dollar.

Costs have also risen sharply over the last nine months, jumping to $355.27bn from $311bn a year ago, an increase of 14% year on year as inflation and rising interest rates have taken their toll.

Ipek Ozkardeskaya, senior analyst at Swissquote, said: “An ugly week of Big Tech earnings is…coming to an end, having wiped out hopes of seeing earnings boost gains across the stock markets."

Meanwhile, Laith Khalaf, head of investment analysis at AJ Bell said: “Having held the line for most of this week the FTSE 100 finally caves to the negative pressure from big tech disappointments across the pond.

“The FTSE 100 may be underrepresented on the technology front but the wider hit to sentiment from some of the world’s largest companies dropping the ball couldn’t be entirely avoided."

Read more: Crypto could be at risk from EU's new 'kill switch'

Meanwhile, stocks in Asia tumbled after the falls in US tech shares. In Tokyo, the Nikkei (^N225) closed 0.9% lower, while the Hang Seng (^HSI) slumped 4% on the day to their lowest levels since 2009. The Shanghai Composite (000001.SS) dipped 2.3%.

The Japanese yen fell overnight after the Bank of Japan stuck to ultra-low interest rates and maintained its dovish stance, bucking the tightening trend among central banks around the world.

However, it did revise its price forecasts higher through 2024, and warned that inflationary pressures were broadening.

“The labour market will continue to tighten and gradually strengthen wage pressure,” it said.

Watch: How does inflation affect interest rates?