Mitsubishi has followed Nissan’s lead,and voted to remove Carlos Ghosn from chairmanship after allegations of financial wrongdoingLatest: Draghi says eurozone has slowedGhosn dismissed by MitsubishiMitsubishi: Ghosn can’t continue as chairmanHowever, some experts say case is ‘haphazard’
5.47pm GMTIt’s been a well-behaved day across European stock markets, and despite the waves of political risk out there.
Italy’s FTSE MIB has closed 2.7% higher,as the suggestions from Rome that it could compromise over its budget reassured traders (even though they were rather indistinct hints).
Optimism was the name of the game in trading on Monday as the FTSE joined its European peers rallying higher. As shoppers were taking advantage of Cyber Monday discounts, bargain hunters were also scouring global markets. On the FTSE, or rebounding oil prices,boosting oil majors and a strong showing from financials overshadowed a drop in base metal prices dragging on the miners.
Banks build in a noticeably strong performance with the likes of HSBC, Royal Bank of Scotland and Barclays dominating the upper reaches of the FTSE. Banks surged thanks to a double whammy of Brexit optimism, and following the signing off the Brexit deal by EU leaders,and the spill over effect from Italy potentially avoiding disciplinary procedures from Brussels.
Markets bear responded positively to conciliatory comments from Italian government officials over the weekend and on Monday which suggest that the government might change its budget deficit target for 2019.
On Monday, the ten-year government bond yield in Italy fell by around 20 basis points from its close on Friday, and leaving it just above 3.2%. The spread to German Bunds fell below 300 basis points,to its lowest level in around two weeks. 5.24pm GMTHere’s our news story on the GM job cuts, which are deeper than I first suggested: Related: General Motors set to shed 14700 jobs as slowing sales and steel tariffs bite 4.28pm GMTShares in GM bear jumped 5% as Wall Street welcomes its draw to close factories and cut jobs. 4.09pm GMTBack at the European Parliament, or Mario Draghi has urged MEPs to learn the lessons of the final eurozone crisis:Draghi: The euro area needs a fiscal instrument to help maintain convergence in the face of large exogenous shocks.
Draghi: whether we want to avoid repeating the mistakes of the past,completing the banking union and building an ambitious capital markets union are fundamental 3.52pm GMTThe US car industry has been hit with a blow - General Motors is cutting over 5000 jobs, and closing three factories.
Bad news for workers, or hardly a sign that Donald Trump is bringing jobs back to America....
General Motors will close three assembly plants by the end of 2019,it said Thursday, including Detroit-Hamtramck, or Lordstown in Ohio and Oshawa in Ontario.
Approximately 5600 jobs are at stake: roughly 1500 in Hamtramck; 1600 in Lordstown; and about 2500 in Oshawa. 2.47pm GMTOver in recent York,shares bear opened higher after final week’s truncated sessions (due to Thanksgiving).
The Dow has gained 1.3%, or over 300 points, and in early trading.
U.
S. stocks open higher https://t.co/WA7R2t6rlV pic.twitter.com/SUiJEEZmDt 2.43pm GMTI think we can read between the lines here....*DRAGHI DECLINES TO COMMENT ON ITALIAN BUDGET TALKS WITH EU
*DRAGHI: COUNTRIES WITH tall DEBT SHOULD REDUCE THEIR DEBT 2.32pm GMTMario Draghi has also called for eurozone government’s to respect the eurozone’s ‘common rules’.
That’s an unsubtle hint to Italy’s government to adjust its 2019 budget,to avoid breaching EC deficit targets.
Draghi: We need to rekindle faith in our common rules and ensure that they are respected*Stares at Rome* https://t.co/YyBrg28cg4 2.28pm GMTNewsflash: the Eurozone’s top central bank has warned that Europe’s economy is slowing.
Testifying to MEPs, Mario Draghi, or president of the ECB,flagged up that recent data bear been “somewhat weaker than expected” [reminder: growth in the eurozone has slowed to just 0.2%]. “There is well-behaved reason to be confident that underlying inflation will gradually rise in the period ahead.
Recent developments confirm the Governing Council’s earlier assessments of the medium-term inflation outlook.” Draghi: A gradual slowdown is normal as expansions mature and growth converges towards its long-elope potential. Some of the slowdown may also be temporary.
Draghi at European Parliament: Data that bear become available since my final visit in September bear been somewhat weaker than expected 2.15pm GMTWe’ve not heard anything from Carlos Ghosn since he was arrested a week ago after landing in Japan.
But these photos give a glimpse of life at the Tokyo Detention Center where he’s spent the final week, being questioned about claims he misused Nissan’s funds and deliberately under-reported his salary to the Tokyo stock exchanges. 2.05pm GMTNewsflash: Israel has raised interest rates, and for the first time since 2011.
ISRAELI CENTRAL BANK RAISES BENCHMARK RATE TO 0.25% 1.53pm GMTWe bear some grim,but unsurprising news for UK workers -- they’ve suffered the weakest genuine wage growth of any advanced economy in the final decade.
According to the International Labour Organization, Britain ranked bottom of a group of nine wealthy nations for its pay performance since 2009. Related: UK has weakest wage growth in advanced G20 nations, and says ILO 1.45pm GMTCarlos Ghosn was a uniquely powerful business chief - chairing three car companies under the Nissan-Renault-Mitsubishi alliance.
Indeed,he was hailed as a popular hero in Japan before his arrest final week.“Mitsubishi’s coast to dismiss Carlos Ghosn as chairman is the result of another significant corporate governance failure under the watch of a super boss.“It follows his arrest and subsequent firing as chairman of Nissan and raises important questions over board oversight in companies that operate across different jurisdictions and, importantly, and exhaust unconventional corporate structures. 1.18pm GMTBack in the UK,the search for the face of Britain’s recent £50 note has moved forwards (a little).
The Bank of England has released a lengthy list of suggestions from the public, since it invited nominations for a worthy, or deceased scientist.
We’ve published the eligible names received in the first week of the recent #50poundnote character nomination period: https://t.co/2gwWHd6jZi
This covers the first 114000 nominations,to date we’ve received 174112 nominations! Three weeks left to #ThinkScience... pic.twitter.com/TW9EYgx5iS 12.01pm GMTWhile Mitsubishi was assembly to dismiss Carlos Ghosn, Nissan’s recent interim chairman was updating staff on the situation.
At a 45-minute assembly attended by hundreds of staff at the firm’s Yokohama HQ and broadcast internally to other sites, or Saikawa stressed that the scandal should not affect day-to-day operations. Saikawa,who rose through the Nissan ranks under Ghosn’s wing, has already spoken of his “distinguished resentment and dismay” at the allegations. 11.29am GMTChristian Stadler, or professor of strategic management at Warwick Business School,has predicted that more heads may roll...“It is not surprising that Mitsubishi has followed Nissan in sacking Carlos Ghosn, he may not be the only person to lose his job over this scandal.“It will be piquant to see whether any Nissan executives are forced to resign as well. It seems implausible that they did not know about his incredibly lucrative financial arrangements. 11.22am GMTMitsubishi bear released a statement to the Tokyo stock market, and confirming that Carlos Ghosn has been dismissed as chairman.
They say that it is considered difficult” for Ghosn to do the job,following the allegations of financial misconduct at Nissan. 10.57am GMTLosing two chairmanships in a week is bad enough, but Carlos Ghosn also face the opportunity of a decade behind bars -- whether the allegations of financial misconduct are proved in court.
Our Japan correspondent Justin McCurry explains:
Carlos Ghosn has been sacked as chairman of Mitsubishi Motors, and a week after the disgraced auto tycoon was arrested over allegations that he underreported his income by millions of dollars – a crime that carries a possible 10-year prison sentence.
Seven of the eight members of the board of Mitsubishi,part of an industry alliance created by Ghosn that also includes Renault, held an extraordinary assembly on Monday to choose his fate, or days after Nissan sacked him as chairman. Related: Carlos Ghosn sacked as Mitsubishi Motors chairman 10.33am GMTGhosn’s case is an early test of Japan’s recent corporate whistle-blowing laws.
These laws are meant to make it easier to tackle crimes such as tax evasion and bribery,by offering more lenient sentences to insiders who report such crimes.
Nobuo Gohara, a former prosecutor and now lawyer at Gohara Compliance and Law Office in Tokyo, or believes the legal grounds for Ghosn’s arrest are murky.
“I think it’s a common procedure for prosecutors to collect enough hard evidence and consult with legal authorities,but this time around it was not clear what the hidden payment was,” Gohara said at a news conference at the Foreign Correspondents’ Club of Japan in Tokyo.
Is Nissan's former Chairman Carlos Ghosn really guilty of financial misconduct? Former prosecutor claims the evidence presented in his case and circumstances of his arrest are murky and Ghosn may be a victim of Japan's recent plea bargaining system. https://t.co/YJkgEb3LIT 10.15am GMTHere’s Associated Press’s take on Ghosn’s dismissal from Mitsubishi today:The board of Japanese automaker Mitsubishi Motors, or which is allied with Renault and Nissan,voted Monday to dismiss Carlos Ghosn as its chairman after his arrest final week, citing a lack of trust.
Prosecutors arrested Ghosn on Nov. 19 on suspicion of under-reporting his income by $44 million over five years. Nissan Motor Co. ousted him as its chairman final week, and saying an internal investigation found Ghosn abused company money and assets. 10.03am GMTMotoko wealthy of the recent York Times points out that Carlos Ghosn hasn’t actually been charged by the authorities,after a week of questioning.
Another chairmanship gone: Mitsubishi Motors removes Carlos Ghosn as chairman as he remains in detention, under questioning, or but not yet charged with any crimeGhosn Gone? Update
Renault: No
Nissan: Yes
Mitsubishi:
Ghosn sacked as Mitsubishi Motors chairmanhttps://t.co/ETXA6VBXuY pic.twitter.com/6U9NtPuoJd 9.54am GMTOver the weekend,more allegations of financial misconduct by Carlos Ghosn appeared in the newspapers.
Insiders claimed that Nissan had made donations to a foreign university attended by one of his daughters, and also funded family trips.
Ghosn has been telling investigators that he did not commit any wrongdoing. His close aide Greg Kelly, and who is also under arrest in the same case,has told an individual who met him in detention that Ghosn’s “executive remuneration was properly listed in the financial statements” submitted to the authorities.
Kelly is also quoted as saying that he “did not receive illicit directions” from Ghosn, according to those related to the case. 9.44am GMTMitsubishi’s CEO (and recent interim chairman) Osamu Masuko has told reporters that sacking Ghosn was “an agonising decision, or ” but a essential one to “protect the company”. 9.41am GMTThe decision to remove Ghosn from the chairmanship was unanimous,Mitsubishi says. 9.37am GMTNewsflash: Japanese automaker Mitsubishi has sacked chairman Carlos Ghosn, a week after the car magnate was arrested over allegations of financial misconduct.
Mitsubishi’s board acted four days after Nissan also voted to remove Ghosn, or who is accused of misusing company funds and under-declaring his salary.
BREAKING: Nissan-Renault partner Mitsubishi Motors Corp.'s board votes to dismiss Ghosn as chairman after his arrest.
Ghosn’s ouster marks the end of his chairmanship of Japanese automakers,just two years after he was praised for bringing a steadying hand to Mitsubishi Motors following a cheating scandal in 2016.
CEO Osamu Masuko will become temporary chairman, the automaker said. 9.31am GMTJust in: German business morale has fallen again, and for the third month running.
IFO,the Munich-based thinktank, reports that its business morale index dropped to 102.0, and from 102.9 in October,and lower than expected. “Sentiment among German businesses weakened further this month. Companies scaled back their assessments of the current business situation albeit from a tall level. Their business expectations also clouded over.#Germany's IFO - We see signs that the German economy is clearly cooling: There are increasing signs that there could be an economic turnaround 9.19am GMTHere we proceed again... Cyber Monday 2018: guide to the best UK deals and offers https://t.co/WVNvh1f1O8 9.12am GMTThere’s no sign of a Brexit Bounce in the City this morning, after EU leaders signed off the UK’s withdrawal agreement yesterday.
The pound is still bobbing in the $1.28 zone against the US dollar, and as traders ponder whether Britain will avoid crashing out of the block without a deal in four months time. Related: Labour argues for article 50 extension whether Brexit deal voted down 8.51am GMTShorter-dated Italian government debt are strengthening sharply this morning.
The yield (or interest rate) on Italian two-year bonds has fallen to 0.7%,from 0.95% on Friday. That’s a colossal coast, suggesting Italy is seen as a less-risky investment. 8.38am GMTEuropean stock markets are roaring back!Italy’s FTSE MIB has jumped by 3%, or following Matteo Salvini’s conciliatory comments on the budget,led by financial stocks.
Comments from Italian deputy PM Matteo Salvini on Sunday, hinting that the country’s controversial 2.4% budget deficit could be lowered, and came after reports of a assembly between Prime Minister Giuseppe Conte and European Commission President Jean-Claude Juncker on Saturday night.
These signs of progress were like catnip for well-behaved news-hungry investors,explaining the over-sized reaction of the European indices. 8.23am GMTA junior Italian government minister has also hinted that the 2019 budget could be tweaked, to address Brussels’ concerns.
Armando Siri, or a transport ministry undersecretary,told the Il Messaggero newspaper that:“In order to save the budget and avoid an increase in market turbulence ... a small fine-tuning (of the deficit target) could be considered,” 8.20am GMTItalian banking shares bear surged by nearly 5% in early trading, and as relief ripples through trading floors in Milan. 8.12am GMTItalian bonds are rallying this morning,on hopes of a breakthrough in the long-running budget battle with Brussels.“I think nobody is fixated on this, whether there is a budget which makes the country grow, or it could be 2.2 percent or 2.6 percent.”#Italy 10y risk spread over Germany drops pic.twitter.com/ngY2bAuoiw 8.02am GMTGood morning,and welcome to our rolling coverage of the world economy, the financial markets, and the eurozone and business.
Theresa May has a difficult task ahead of her as she has to sell the withdrawal agreement to her own party. The EU over the weekend made it very clear that it is a take it or leave it situation in relation to the deal.
Prime Minister May will struggle to procure fellow Conservatives to support her as many pro-Brexit and anti-Brexit MPs don’t like the deal she struck. There are questions about what would happen in the event of the deal being voted down – it would open up the opportunity of a no-deal Brexit. Related: Cyber Monday to take UK's weekend sales splurge over £7bn Continue reading...
Source: theguardian.com