With the US markets calming down last night after a wobble on Tuesday, there was also a sense of calm across most of Asia and Europe on Wednesday.
The exception was Japan’s Nikkei index, down 1.3% thanks to weakness among utilities, consumer cyclicals and industrials.
Russ Mould, investment director at AJ Bell, said: “On the Hang Seng index in Hong Kong, Techtronic Industries became the latest target for short sellers, with its share price slumping 19% after Jehoshaphat Research published a report claiming the power tools company has been ‘inflating its profits dramatically for over a decade with manipulative accounting’. By short selling the stock, Jehoshaphat stands to profit from a decline in the share price.
“It comes a week after arts and crafts platform Etsy was victim to a similar damning report from short seller Citron Research which accused it of selling goods that ripped off well-known brands.
“The FTSE 100 slipped 0.3% as a positive reaction to results from Rolls-Royce and WPP was not enough to offset weakness from various mining, pharmaceutical and consumer goods stocks.
“BAE Systems dipped nearly 3% on its full year results. Despite predicting higher military spend in 2023 which should improve its earnings, the negative share price reaction is most likely to down to investors taking profit after a strong run for the shares since Russia invaded Ukraine a year ago and how that led investors to seek exposure to the defence sector.”