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Investment market update

Early Trading

UK stocks are expected to open lower this morning, mirroring falls on Wall Street overnight. Markets have been surprised by the Bank of Japan’s decision to keep monetary policy unchanged, as well as by recent disappointing results from Apple.

World Markets

Asian stocks fell, extending their weekly decline after the Bank of Japan quashed expectations for further stimulus and investors scrutinised earnings from PetroChina Co. and China Petroleum & Chemical Corp.
US stocks fell, with the Standard & Poor’s 500 Index capping the biggest drop in three weeks, as Apple Inc. led an afternoon selloff in technology shares, overshadowing corporate deals and strong results from Facebook Inc.

UK stocks clawed back its early falls as gains in mining shares outweighed losses among banks. Lloyds Banking Group shares fell more than 2% after it reported a fall in profits, while Royal Bank of Scotland fell 4.4%. Tullow Oil was the best performer on the FTSE 100, rising 11% as the oil price hit new highs for 2016.

Headlines

A UK think tank with a self-described “free-market” political stance is calling for the British Broadcasting Corp. to be sold off to private investors, saying the world’s oldest national broadcaster is biased in its news coverage and too close to political processes. The London-based group, the Institute of Economic Affairs, said in a report published Thursday that the funding model for the BBC — a license fee paid by UK residents owning a TV set — is out of date. It cited new technologies allowing viewers to watch television on the go and from a variety of devices, as well as increased competition from Internet news sites.

The US dollar dropped against all of its G-10 peers after weaker-than-expected US economic growth dimmed prospects for a Federal Reserve interest-rate increase at a time when monetary easing is being put on hold elsewhere. The Bloomberg Dollar Spot Index sank to an 11-month low, while the yen was headed for its biggest weekly jump since 2008 after the Bank of Japan unexpectedly refrained from adding to record stimulus on Thursday.

Billionaire Carl Icahn, who first disclosed his stake in Apple Inc. almost three years ago, has sold out of his position because of concerns about the company’s relationship with China, the activist said Thursday. “We no longer have a position in Apple,” Icahn told CNBC. Icahn sold most of his remaining stake in February, he said. “I got out because I’m worried about China.” Icahn perceives a risk in Apple’s relationship with China and that made his already profitable investment in the company no longer a “no-brainer,” he said. China shut down Apple’s iTunes Movies and iBooks services recently, showing that the company isn’t immune to the reach of Beijing regulators.

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