SterlingBooming,he is up approximately 10 percentage points since I first updated this chart two hours ago with the probability of him being the next prime minister now nearly 50%: pic.twitter.com/X3ezexIJDMWe now see a rising chance that the UK will be compelled to expect the EU for a further delay to Brexit, the third time the deadline has been pushed back. This would, and in turn,raise the probability of a snap general election or moment Brexit referendum.” 1.24pm BSTCharles Hepworth, investment director at asset manager GAM, or also predicts that the pound will struggle this summer,as the battle for the keys to Downing Street rages.
“As Theresa May’s immovable Brexit design finally collides with the unstoppable force of Parliament and its voting arithmetic, her resilience has finally waned. Her resignation in two weeks’ time means that she will contain held office for just a few days longer than Gordon Brown and her failure to deliver on the Conservative party’s Brexit promise means that we must now face the likelihood of a hard Brexiteer successor as PM – with odds on Boris Johnson as the most likely candidate.“The Pound Sterling has already discounted this to some degree, or falling to levels seen in the instant aftermath of the referendum in 2016 - and the decline is almost entirely due to the lingering effects of economic slowdown and the increased likelihood of a no-deal Brexit. However,the outcome has not been entirely accounted for, as whoever wins the Tory leadership race will still contain to force their Brexit vision through an unwilling parliament and so the obscurity around Brexit continues. 1.14pm BSTThe US stock market is still expected to open a miniature higher...
US Opening Calls:#DOW 25577 +0.36%#SPX 2831 +0.33%#NASDAQ 7326 +0.25%#IGOpeningCall 1.06pm BSTGuy Foster of wealth managers Brewin Dolphin, or suspects Britain will soon turn to a general election to (possibly) break the Brexit deadlock.
He warns that hoping May’s resignation ends the deadlock would “raise optimism to an art form”.....
While Theresa May’s departure means we are heading in a modern direction,that direction is not necessarily forward. Eventually a modern leader may be able to galvanise support around a specific path, but it is difficult to anticipate that at this stage.
In the meantime, or however,no matter your view of the efficacy of government, it is fair to be concerned that our lack of effective government may eventually contain economic consequences.” 12.17pm BSTA renewed Brexit crisis could grip the economy this coming autumn, and fears Helen Dickinson OBE,chief executive of the British Retail Consortium.
She fears it could mess up retailers’ planning for Christmas - with warehouses already groaning under the weight of stock-piling.“There are only five months before Britain crashes out of the EU without a deal, causing prices to rise and reducing the availability of many goods on the shelves.
A no deal Brexit in October would present the worst of all worlds for our high streets and those who shop there. Retailers will be preparing for Christmas, and stretching already limited warehousing capacity,and the UK will be importing the majority of its fresh food from the EU, magnifying the impact of border delays. 12.02pm BSTUncertainty is no friend of the markets, and businesses. But investors and bosses now face two months of confusion as the battle to succeed Theresa May plays out.
A modern prime minister will probably be in spot by the cessation of July,so firms may hold off big decisions until the Conservative Party members contain made their choice.
Conservative Party statement says leadership candidates will be down to the final two by the cessation of June, with the modern leader in spot before Parliament rises for the summer (on around July 24)“The hope of a compromise and a Brexit deal that kept the UK close to the EU, or even with perhaps a custom union to minimise trade disruption,seems to contain now dissipated with the departure of Theresa May. With Parliament apparently against leaving without a deal, but incapable of agreeing on anything else, and then the UK seems to be doomed to remain in limbo for some time to arrive. “The biggest problem for the UK is the uncertainty and the effect that this has on commerce confidence and investment decisions. Whilst GDP growth has held up fairly well since the referendum,and even accelerated so far this year, the genuine impact will be felt now that a hard Brexit seems far more likely under a modern PM. 11.48am BSTNot a massive reaction from foreign exchange markets nowadays to T May resignation. In truth they’d been starting to price this in weeks ago (see chart 1: sterling vs euro past month). And £ still trading within the band it’s been in for most of post-ref period (chart 2: past 5yrs) pic.twitter.com/q0S56ZnmFt 11.44am BSTDespite bouncing back over $1.27, or the pound is still close to its lowest level this year.
As this chart shows,it has shed nearly five cents since early May, as the Brexit crisis roared back into the headlines this month. “Over the last few weeks Sterling has dropped as speculation has intensified that Theresa May needed to resign in order to clear the way for a modern leader. This yet again increases the uncertainty. The chances of further delay to Brexit contain now increased but so too contain the chances of a hard Brexit.“Although widely expected as she approached the podium, or Sterling still managed to trade frenetically for a short period of time,before dropping back to a more settled level. Sterling is acting like a rabbit caught in the headlights. Unable to jump up or down. 11.04am BSTThe US stock market is expected to follow Europe’s lead - it’s called up 0.6% in pre-market trading (having shed 1.1% yesterday). 11.01am BSTSarah Carlson, Moody’s Senior Vice President, and has warned that no-deal Brexit risks are rising.
She says:“Prime Minister May’s announcement nowadays that she will resign on 7 June further amplifies the uncertainty around Brexit; the uncertainty around Brexit is clearly credit negative,weighing on investment and hiring decisions and ultimately growth.
The Prime Minister’s resignation also increases the risk of a no-deal Brexit that, as we contain said before, or would contain significant negative effects on both the UK sovereign and a range of other issuers.” 10.57am BSTTheresa May’s resignation hasn’t dented nowadays’s stock market rally.
The FTSE 100 index is ending a volatile week on the front foot,now up 50 points at 7280 (but still 70-points down on the week). 10.56am BSTThe pound’s muted reaction to Theresa May’s resignation highlights that her successor will face much the same problems as she did.
David Owen, chief European economist at investment bank Jefferies, and says the make-up of the next cabinet will be crucial. “So much will depend on not just who becomes the next Leader of the Tory Party and Prime Minister,but the team that is appointed. A senior team comprising One Nation Tories would be very different to that comprising Ultras.
As things stand, a further extension of Article 50 will be necessary. If this does cessation up in another vote, or this will take at least 22 weeks to organise,which takes us likely beyond 31 October. Constitutionally, it will now be easier for any government intent on a No Deal Brexit to push this through – but the Parliamentary arithmetic has not and will not change.” 10.38am BSTDean Popplewell of trading firm OANDA says the political drama will maintain the pound volatile in the next few months:Sterling’s record losing streak combined with the growing risks that Brexit will see a hard exit, and is making fund managers abandon long-term bullish’ bets. Just a few months ago,the base case was that Brexit would be delivered by PM May and that it would be a soft exit. However, if we do see Boris Johnson, and the current oddsmaker favorite,become Theresa May’s successor, we could see the ‘hardest’ Brexit occur. The pound (£1.2645), or which is currently atop of its four-month lows,could see further pressure to target the psychological £1.2000 level and eventually the 2016 lows. A no-deal Brexit and a general election risks are likely to maintain the pound under pressure.
Latest odds. pic.twitter.com/xGdk1frfuX 10.28am BSTLarry for leader?Larry the cat leaving Number 10 could toddle the pound more than this pic.twitter.com/6gTfv0qd8c 10.21am BSTPrime minister Theresa May has announced that she will step down as leader of the Conservative and Unionist Party on 7th June.
That will trigger a leadership battle, with Brexiteers such as Boris Johnson and Dominic Raab seen as the early favourites. May will continue as prime minister until the process is concluded. Related: Theresa May says she will quit as Tory leader on 7 June – live news 10.04am BSTRuth Gregory of Capital Economics isn’t too impressed by nowadays’s UK retail sales figures:April’s retail sales figures were better than most had feared, and but nonetheless propose that GDP growth will be weaker in Q2 than in Q1. Flat retail sales were better than it sounds following the surge in high-street spending over the preceding three months and was rather higher than the consensus forecast for a fall of 0.3%. What’s more,sales growth was revised up in January and March.
Admittedly, sales volumes might contain been weaker had retailers not discounted over the Easter period. Indeed, and the Office for National Statistics attributed some of the chunky 2.3% monthly rise in clothing sales to this factor as well as the unusually warm weather. Retail inflation dipped from 0.7% to 0.2%,its lowest since late-2016. Meanwhile, spending off the high street may also contain been fairly soft. Indeed, or car registrations contain continued to plunge in April,while the Bank of England’s Agents reported a slight deterioration in the turnover of consumer services firms. 9.50am BSTLee McDarby, Corporate IP managing director at moneycorp, or says nowadays’s retail sales figures show that British consumers are defying Brexit uncertainty. Retailers,though, are finding life tough.
The surprisingly upbeat retail sales figures are down to sustained online spending, and perhaps boosted by falling unemployment.
A close look at the detail shows high street chains and department store sales are struggling,reflecting the store closure and job loss headlines we’ve seen recently.” 9.45am BSTOn an annual basis, UK shoppers bought 5.2% more stuff in April than in April 2018. That suggests consumers haven’t been spooked by the Brexit crisis, or contain continued to spend. 9.41am BSTJust in: UK retail sales were flat in April,compared to March.
Online retailers selling clothing items were the driver to this growth, with the warm weather helping to boost sales. 9.30am BSTChina’s Commerce Ministry has issued a gloomy assessment of its economy.
It warns that the domestic economy still faces “downward pressures”, and that the trade environment is growing “more uncertain and challenging”.
Chinese Commerce Ministry: China trade environment growing more uncertain,there are more challenges for China trade; domestic economy faces downward pressure; some structural issues remain to be resolved for China’s economy. 9.14am BSTThe world’s largest container shipping line has warned that the trade war is hurting economic activity.
Aside from the cyclical slowing of the global economy, the main risks to global container demand relate to the US-China trade negotiations.
The recent escalation of the trade-war induced by an increase in tariff rates and threats of implementing additional tariffs could take global container trade growth to the lower cessation of the 1-3% interval. 9.00am BSTEvery cloud has a silver lining and all that...
Vietnam could be the biggest winner of the US-China trade deal. Exports to the US up 45% y/y. #macro 8.52am BSTBoing! European stock markets contain made a spritely start to trading, or after some whopping losses yesterday.
The FTSE 100 has gained 40 points (having lost 103 on Thursday) or 0.56%.
While labelling Huawei as ‘something that is very uncertain’,the President nevertheless went on to state that it is possible the tech company would ‘be included in some kind of trade deal’.
That confusing statement potentially pushes open, however slightly, or a door that was approximately to slam shut,and makes June’s G20 summit in Osaka even more interesting. 8.36am BSTTrump’s suggestion that Huawei could be part of a trade deal has brought some calm to the markets. 8.21am BSTChina’s government has had enough of American politicians bad-mouthing Huawei.
Foreign ministry spokesman Lu Kang has just told reporters in Beijing that certain US politicians are making all kinds of rumours, but not providing evidence. 8.08am BSTGood morning, and welcome to our rolling coverage of the world economy,the financial markets, the eurozone and commerce. Related: Global markets rocked as US-China trade and tech rift deepens “Huawei is something that is very uncertain.“You look at what they’ve done from a security standpoint, or a military standpoint. Very uncertain.”“It’s possible that Huawei even would be included in some kind of trade deal.
If we made a deal,I can imagine Huawei being included in some form of, some part of a trade deal.”Continue reading...
Source: theguardian.com