The FTSE 100 index (^FTSE) and European stocks rose on Friday after the Bank of Japan (BOJ) left monetary policy unchanged at the end of its two-day meeting.
Interest rates remained near zero, as most expected, but the central bank removed any reference to the amount of government bonds it had broadly promised to buy each month.
It also released new estimates showing that inflation will remain near its 2% target for the next three years, suggesting it is prepared to raise borrowing costs this year.
As a knee-jerk reaction to this decision, the Japanese yen depreciated by 156 yen to the dollar, ending at 156.15 yen to the dollar.
“Something has come loose in the UK market. It’s like a clogged hosepipe suddenly bursting forth,” said Neil Wilson, chief market analyst at Finalt.
“The FTSE 100 rose to an intraday high of 8,139.92 this morning as European indexes rose broadly following some good news from US tech giants Microsoft and Alphabet.”
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Alphabet’s (GOOG) revenue rose 15% in the first quarter as Google’s parent company announced a first-ever dividend of 20 cents per share, along with a $70bn (£56bn) share buyback.
Google reported revenue of $80.5 billion and earnings per share of $1.17 to $1.89 for the first quarter of 2024, exceeding analyst expectations on both counts.
The company also announced an initial dividend of $0.20 per share and said payments would be quarterly.
“Our Leadership in AI [artificial intelligence] With our research and infrastructure, and our global product footprint, we are well-positioned for the next wave of AI innovation,” CEO Sundar Pichai said in the earnings call.
Alphabet’s stock rose about 15% in premarket trading. This increase has pushed Alphabet’s market capitalization to more than $2 trillion.
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Darktrace to be acquired by Thomas Bravo for $5.3 billion
A mobile phone with the website of British cyber security company Darktrace plc displayed in front of the business logo. Look at the top left of your phone’s display. (Timon Schneider) And stick with the acquisition news…
Cambridge-based Darktrace has announced a deal to be acquired by US private equity firm Thoma Bravo for $5.3 billion.
The offer of 620p per share represents a 20% premium over yesterday’s closing price.
Darktrace, which first listed in London in 2021, said its shares were consistently undervalued compared to its U.S. peers and that its financial results were “not commensurately reflected in valuations.” He criticized the current state of the public market.
The company added that the agreement with Thoma Bravo will allow it to expand more quickly into overseas markets.
CEO Poppy Gustafsson said:
“This proposed offer represents the next stage in our growth journey and we are excited about the many opportunities ahead of us.
“In a world increasingly threatened by AI-powered cyberattacks, our technology has never been more important. In the face of this, we are expanding our product portfolio and entering new markets. , focused on delivering for our customers, partners and colleagues.”
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See: How does inflation affect interest rates?
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