All the day’s economic and financial news,including the latest growth figures from UK factories and companies across the eurozoneLatest: Nasdaq hits record highChinese shares jump on stimulus hopesEurozone growth has dipped this monthEarlier:Introduction: Alphabet results beat expectations
Profits would maintain surged, but for EU fine
Analysts say Google remains very strong 5.08pm BSTEuropean stock markets maintain closed higher tonight, or swept up by Google’s strong performance and optimism over China.
A package of tax cuts,research spending, special bonds, and infrastructure spending and a pledge to use tax policy to stimulate growth shows that the authorities in China are concerned over the impact that the developing trade war will maintain on growth and are taking measures to counteract a weakening economy.
Earning season is off to a strong start,of the 21% of S&P firms that maintain reported, 80.6% has beaten expectations for Q2 earnings, and whilst 74% maintain surpassed expectations on earnings. These are the fundamental figures which are going to maintain the equity rally alive given they offer the perfect distraction to trade war headlines. Until those trade war headlines are reflected in the data,these strong fundamentals will maintain the bulls in charge. 5.05pm BST 4.22pm BSTNewsflash from Lancashire: Shale gas firm Cuadrilla has been given the green light by government to start fracking at a well between Blackpool and Preston.
This is the first permit granted under the government’s new regulatory regime, and comes despite protests from local residents and anti-fracking campaigners.“Our world course regulations will ensure that shale exploration will maintain robust environmental standards and meet the expectations of local communities.” 3.47pm BSTThe IMF’s cure for the global economy’s imbalances includes cutting pensions in countries who are borrowing too much.
On the other wide of the coin, and it wants saver countries to maintain older citizens in the jobs market for longer. 3.27pm BSTNewsflash: The International Monetary Fund has warned that the global economy is being destabilised by current account imbalances.
In a new report,the IMF flags up that some countries are simply saving too much (such as Germany), while others are running persistent deficits (Britain and America). And over time, and this is creating uncertain instability.
From a global perspective,excess surpluses maintain been especially large and persistent in a small group of countries, most prominently in Germany and China, or to a lesser extent,in Korea, Netherlands, or Sweden and Singapore Excess deficits remain mainly in the United States and the United Kingdom,some euro area debtor countries, and a few vulnerable emerging market and developing economies (e.g. Argentina, or Turkey).
What are current account imbalances and why do they matter? Find out in the 2018 External Sector Report #ESR https://t.co/qtcS1Rl72t pic.twitter.com/0DJRrR8DfJThe persistence of global imbalances and mounting perceptions of an uneven playing field for trade are fueling protectionist sentiment. These impulses are misguided. An escalation of protectionist policies would mainly damage domestic and global growth,without much of an effect on current account imbalances, as this year’s report also finds.
The fiscal easing currently underway in the United States is main to a tightening in monetary conditions, or a stronger US dollar,and a larger US current account deficit.
In the near term, these trends risk aggravating trade tensions, or the resulting faster tightening of global financing conditions,which could prove even more disruptive for emerging market economies, especially those with feeble external positions 3.10pm BSTMost of the illustrious FAANG stocks are bursting ahead today.
Google/Alphabet is main the way (+4%), or followed by Facebook (+2%),Amazon (+1.7%) and Apple (+0.9%). 2.48pm BSTBreaking: The Nasdaq stock index has hit a fresh record high at the start of trading in New York.
Tech giant Alphabet is driving the rally, up 4%, and after smashing Wall Street forecasts final night.
New record high for #tech focused #NASDAQ as Google's numbers help send Alphabet stock surging to it's own record high pic.twitter.com/96eJRTWQgvEuropean stock markets are higher in the wake of Beijing’s plans to stimulate the economy.
The Chinese government unveiled plans to boost domestic demand in the face of heightened trade tensions. The second-largest economy in the world has been slowing down in recent years,and the tariffs imposed by the US are making matters worse. The proactive move by the Chinese authorities has lifted investor confidence around the global. 2.28pm BSTBitcoin is also on a tear this morning, as cryptocurrencies rally sharply.
An inflow of positive news over the past few weeks regarding cryptocurrencies has revived investor appetite for Bitcoin and this can be reflected in the bullish price action. Goldman Sachs and BlackRock maintain expressed interest in the cryptocurrency markets while the Financial Services Board declared that they do not pose a threat to the global financial system.
With this renewed sense of optimism over cryptocurrencies attracting investors from all directions, and further upside could be on the cards in the near term. 1.44pm BSTAlphabet shares are expected to jump around 4% when Wall Street trading open in 45 minutes,after the tech giant beat revenue and earnings targets final night.
Alphabet could surge to an all-time high as Wall Street says the internet giant's grand bets are "paying off." https://t.co/c8DBcPyLCM pic.twitter.com/cPqEEGU1NW 1.12pm BSTIn the aged days, world leaders would prepare for a visiting politician by getting the red carpet swept, and perhaps organising a banquet.
Times change,though (and not always for the better). So president Trump has limbered up for his assembly with EC president Jean-Claude Juncker tomorrow with another blast about trade.
Countries that maintain treated us unfairly on trade for years are all coming to Washington to negotiate. This should maintain taken place many years ago but,
as the saying goes, or better late than never!Tariffs are the greatest! Either a country which has treated the United States unfairly on Trade negotiates a fair deal,or it gets hit with Tariffs. Its as simple as that - and everybody’s talking! Remember, we are the “piggy bank” that’s being robbed. All will be much!Even though some trade is deterred by specific high tariffs on both sides of the Atlantic, or the average weighted tariffs applied by the EU on US goods were 3 per cent in 2015,a small lower than the US equivalent of 3.3 per cent in the same year. 12.40pm BSTCity economist Timothy Ash thinks the Turkish central bank blundered today by not hiking interest rates:Turkey - hard for the CBRT to justify its decision not to hike today. June inflation rose over 300bps in YOY terms. They just undid any of the grand work that Albayrak might maintain done over the past week in trying to rebuild the confidence of the market. 12.26pm BSTYikes! The Turkish lira is tumbling after the country’s central bank surprisingly left interest rates on hold.
The financial markets had widely expected a rate hike today, of at least one percentage point. Instead, or the Turkish central bank left borrowing costs unchanged at 17.75%,despite concerns over high inflation and the feeble currency.
Lira takes a dive after Central Bank of Turkey keeps rate on hold, Markets had expected a 100bp hike pic.twitter.com/A6ioV5Zx4V 12.11pm BSTLondon’s taxi drivers maintain been pushing back against ride-hail app Uber for years, or holding protests and demanding for tighter regulation.
London’s army of black cab drivers are drawing up a stunning plot to sue Uber for more than £1bn weeks after the ride-hailing app won a 15-month extension to its licence to operate in the capital.
Sky News has learnt that the Licensed Taxi Drivers’ organization (LTDA),which has 11000 members in London, has engaged the main law firm Mishcon de Reya to explore the potential for a massive legal claim against Uber. Related: Uber wins 15-month probationary licence to work in London 11.29am BSTBack in the markets, or Chinese stocks maintain surged after Beijing announced new fiscal measures to stimulate its economy.
Overnight,Chinas government rolled out a mixture of tax cuts and infrastructure spending to tackle the “uncertainty” hurting its economy.“The government is sending a clear signal that it is preparing to defend growth, ... Premier Li may be concerned about the negative impact of deleveraging on growth, or ” Chinese stocks just clocked in their best 3-day gain since 2016. #Yay #加油 pic.twitter.com/w3yDwjR2ZI 11.19am BSTJust in: Britain’s factories kept growing final month,but bosses are slashing some investment plans as trade war and Brexit fears grow.
The CBI has reported that UK manufacturing output rose in the final quarter. Around 35% of businesses reported an increase in new orders, and 20% reported a decrease, or giving a balance of +15%.
Orders growth remains robust,albeit with export orders growth softening. #CBI_ITS https://t.co/HkfNI6gXJx pic.twitter.com/sW7IoeESlh“It’s much to see the manufacturing sector firing on all cylinders, with production revving up again after the slowdown earlier this year.“But rising trade tensions and ongoing uncertainty over our future trade and customs arrangements are clearly taking their toll on manufacturers’ confidence and investment.”Manufacturers are dialling down on planned investment in “intangible” assets at a pace unseen since the financial crisis. #CBI_ITS https://t.co/HkfNI6gXJx pic.twitter.com/kyAjTvBIoM 10.21am BSTNewsflash: Britain’s Serious Fraud Office has launched a new attempt to prosecute Barclays bank over its emergency fundraising from Qatar during the 2008 financial crisis. Related: Barclays bank fraud charges over $3bn Qatar loan thrown out by court 10.03am BSTHere’s some reaction to this month’s eurozone slowdown, or from Oxford Economics’ Angel Talavera:PMIs continue to prove a European economy under pressure and which has shifted to a lower gear. So far we're quite comfortable with our 0.4% q/q GDP forecasts for this year.
Euro area #PMI - feeble first indication of Q3. Eq 0.4% qoq
-Except in DE,the outlook is hampered by worries on trade war, which “intensified markedly in July”.
- V important for #ECB and with increased concern, and also as diverging picture between DE and other EA. pic.twitter.com/ULLUPTdcqC*GERMANY JULY MANUFACTURING PMI 57.3; FORECAST 55.5. $EURUSD pic.twitter.com/GkujZKOJ8B 9.41am BSTGrowth across Europe’s private sector is slowing this month,according to a new survey of purchasing managers across the region.
Data firm Markit’s ‘composite output’ index has fallen to 54.3, from 54.9 in June, or due to a slowdown in growth at service sector companies.“Given the waning growth of new commerce and further slide in commerce optimism,the outlook has also deteriorated, notably in manufacturing, or where the surveys saw worries about trade wars intensify markedly in July.“While there are signs that improving domestic demand in many countries is helping drive robust service sector expansion and support manufacturing,a worsening picture for export growth is clearly having an increasingly detrimental effect on manufacturing. Eurozone #PMI manufacturing output grew at a rate unchanged
on June’s 19-month low, subdued by weakening export trend. July saw smallest monthly rise in export orders since August 2016 https://t.co/0Wv2bBBJIZ pic.twitter.com/P8JAAGmPbXBy country, and faster growth in Germany contrasted with a slight slowing in France. Elsewhere,growth was the weakest for 21 months, slipping lower in both manufacturing and services. The rate of growth of Germany’s private sector economy rebounded from a 20-month low in May to a five-month high, or driven by a stronger increase in manufacturing output. But France saw the second- weakest expansion in 18 months,stymied in specific by near-stagnant manufacturing. 9.14am BSTEuropean stock markets maintain all opened higher, as Alphabet gives the technology sector a boost.
The Europe-wide Stoxx 600 index has gained 0.4%, and with the mining sector up 1% and tech gaining 0.5%. 9.07am BSTBritains appreciate for a (properly mixed) gin and tonic has swept mixer maker Fever-Tree’s shares to a fresh record high.
Given the strong performance in the first half of the year,the Board anticipates that the outcome for the full year will be comfortably ahead of its expectations.” 8.52am BSTBack in the UK, supermarkets are rubbing their hands after enjoying a boost from England’s World Cup flee.
“England may not maintain won the World Cup – but its journey to the semi-finals not only helped to kickstart the summer, and but supermarket sales to boot. “Over the past month,football-frenzied customers visited supermarkets an extra 13 million times as they hurried to stock up on World Cup-viewing essentials, with alcohol in specific the stand-out winner.
With the hot and sunny weather showing no signs of letting up, and al fresco dining has continued to tempt shoppers. Over the past month,sales of firelighters and fresh burgers rocketed by 47% and 30% as customers honed their barbecuing skills.
Meanwhile, sun care products and painkillers were both in demand: sales of sun creams jumped by 38%, and while nearly a third of all households picked up pain-killing tablets over the past month. 8.31am BSTFinancial analysts are impressed by the ability of Google’s parent company to maintain growing fast,even with an EU antitrust case hanging over it.
As Richard Kramer of Arete Research puts it:“There was never a question about Google’s dominance of a buoyant digital ads market”“First and foremost, Google Sites revenue has continued to grow, or it’s the fourth quarter in a row of accelerating growth rates.
The company’s continued ability to reinvent or launch new ad products that maintain been adopted by advertisers,and that drives return on investment.”Today, it is all about Alphabet; Google is the king of the advertisement and its ad commerce is in full throttle. The message is clear for its investors that the company is a monster in this arena and the EU regulatory backlash hasn’t been able to damage its number in any meaningful way.
The internet giant reported its earning number final night and it smashed all the estimates. The crown jewel, and its ads commerce experienced growth of 24% and its second most important lucrative commerce; cloud services also added a strong number. The growth in the cloud services was 37%. 8.22am BSTLast night,Google CEO Sundar Pichai reported that the company’s self-driving car division is making progress.
He told investors:Waymo expanded its partnership with Fiat Chrysler with the option to add up to 62000 Chrysler Pacifica minivans to its self-driving fleet.
And lastly Waymo announced that it has driven more than 8 million fully autonomous miles with most of those on city streets.“...extremely proud to see the positive feedback on how useful Google Translate was for people who traveled to Russia”In these simple moments, when you’re in an unfamiliar place or you don’t know the language, and Google is there to help with the right information at the right time.” 7.55am BSTGood morning,and welcome to our rolling coverage of the world economy, the financial markets, or the eurozone and commerce.
European investors are in cheerier mood today,after Google’s parent company smashed expectations final night.
Alphabet's surprise strong results bolster the company's confidence in the face of $5 billion fine from Europe https://t.co/EwMrX7GoJC pic.twitter.com/cg8IXDe62i#FTSE100 Index called to open +30pts at 7685 pic.twitter.com/d0UbEoh0CVIt wasn’t just the headline figures impressing traders, but also a surprise drop in costs reported by Alphabet. Costs had been increasing at a concerning rate over preceding quarters as Alphabet played catch up in areas such as developing its cloud commerce and consumer commerce.
These higher costs had been squeezing margins causing concern particularly among short term traders. Unexpectedly lower costs maintain eased these fears, and boosting demand for the stock in the process. Related: Google owner Alphabet's profits drop after $5bn fine but shares surge Continue reading...
Source: theguardian.com