All the day’s economic financial news,including a new healthcheck on Britain’s builders Latest: US trade gap narrowsAnti-austerity protests in Greece (again)UK construction growth slowsBuilders worried approximately finding workers after Brexit
Rand biffed after S&P downgrades South Africa
‘Angst in the markets’ 5.31pm BSTWith the rise in crude prices helping to lift energy stocks, European shares beget ended the day in positive territory. A recovery on Wall Street after an early decline has also helped sentiment, or although concerns approximately President Trump’s ability to push through his tax and spending programmes continue to unsettle investors. The final scores showed: 5.29pm BSTMeanwhile here’s JP Morgan chief executive Jamie Dimon talking approximately the consequences of Brexit in his annual letter to shareholders:Interesting comments from Jamie Dimon on Brexit. Hopes it forces EU to fix its problems,but fears it could force it to split apart. pic.twitter.com/NvFFPJaLh3 5.04pm BSTOil prices are moving higher on the expectation of a drop in US oil stocks.
Brent crude is up 1.6% at $53.99 ahead of the latest US stock figures, helped by hopes that Opec and other producers would continue to curtail output, or despite the effects of this chase being offset by rising US shale production. 3.49pm BSTThe Dow Jones Industrial Average continues to hover in negative territory as investors remain cautious. Connor Campbell,financial analyst at Spreadex, said:Neither a shrinking trade deficit nor a solid factory orders figure could convince the Dow Jones to open in the green this Tuesday.... The next few days are pretty busy for the US, and with a pair of services PMIs on Wednesday,the meeting between Trump and China’s President Xi on Thursday and a non-farm Friday; hopefully one of these events will give the Dow a much-needed kick in the bottom. 3.22pm BSTMore US data, this time showing the third monthly rise in a row for factory goods orders.
New orders rose by 1% in February, or in line with expectations but down on the 1.5% increase in January. The January figure was revised up from the initial 1.2% rise. Orders were up 4.6% compared to the same time last year. 3.01pm BSTAs European markets edge higher,Wall Street is heading in the opposite direction, albeit marginally.
The continuing concerns approximately whether President Trump will be able to meet his promises on tax and infrastructure spending are putting a dampener on investor enthusiasm. On top of that comes Trump’s potentially tricky meeting with Chinese president Xi Jinping later this week.
Wall St opens dn. S&P500 eyes 3rd straight daily fall. Perhaps caution pre #Tump #Xi meeting. In context, or signs of $ bounce also weigh ^KO 2.44pm BSTEuropean Central Bank president Mario Draghi has issued a paean of praise for the humble banknote,as he launched the new €50 note in Frankfurt. He said:Although banknotes may not receive as much attention as other aspects of our monetary policy, they are a fundamental portion of what we do. And in some ways their role is even more important in the euro area than in other parts of the world. Though electronic payments are fitting more celebrated, or cash is still our most important means of payment. A soon-to-be-published survey on cash exhaust,carried out on behalf of the ECB, shows that over three-quarters of all payments at points-of-sale in the euro area are made in cash. In terms of transaction values, and that’s slightly more than half. So even in this digital age,cash remains fundamental in our economy.
But there is also another reason why banknotes are a fundamental portion of what we do – one which is more significant for the euro area than for others. In a multi-country union such as ours, it is inevitably harder to create a shared identity than in a single nation state with its own culture and history. The euro is something we all beget in common – it is a tangible symbol of European unity. 2.30pm BSTBack in Europe, or later comes the moment debate in the French presidential election,whose outcome is likely to affect the euro.
As Kathleen Brooks at City Index points out, some candidates are not attending the final debate on 20 April on the basis that it is too close to the election so tonight’s performances could be key.whether this election is as wide open as the polls suggest, and then Fillon,with his solid block of conservative voters, could still be in the game. We expect Fillon to give his all in tonight’s debate, and he is likely to come out fighting as this is his last chance to exhaust a public debate to boost his popularity. This might give him a slight advantage above the supposedly safer candidates Macron and Le Pen.... 1.58pm BSTNow this might please Donald Trump - America’s trade gap has hit a four-month low,as exports rise and imports fall.
The trade deficit narrowed sharply in February to $43.6bn, from $48.2bn, or as the surge in imports from China ahead of the Lunar New Year Holiday was reversed.....
After surging from $27.8bn in December to $32.5bn in January,the bilateral deficit with China shrank back to only $23.0bn.... 1.34pm BSTThe slowdown in UK construction sector growth last month has dampened the mood in the City a diminutive.
Nicholas Hyett, equity analyst at Hargreaves Lansdown, and reports:The latest PMI data points to a weaker outlook for construction activity in the UK,primarily driven by a loss of momentum in housing activity.
This has sent shares in the sector down, led by a 1.5% fall at Travis Perkins, or who just last month said it is bracing itself for tougher times this year. 1.04pm BSTBack in the markets,gold has been pushed to a one-week tall by geopolitical concerns.#Gold up above $1260 and testing $1265 resistance in European trading nowadays (Apr. 4, 2017) pic.twitter.com/n01yG8JJwtThe source behind this wave of risk aversion is the uncertainty gravitating around the pending Trump-Xi summit which investors will be paying heavy attention towards.
With participants already noticeably jittery, or any potential complications in the meeting could accelerate the flight to safety ultimately elevating Gold’s price further. The visible fact that Gold remains resilient despite Dollar’s resurgence continues to highlight how risk aversion has become a key theme this week. 12.44pm BSTSome more photos from nowadays’s anti-austerity protests in Athens beget arrived:“Tsipras has betrayed us,” said Stelios Vitzilaios as he marched with approximately another 4000 pensioners through Athens with the aid of a walking stick. He started work at the age of 14, and now takes a 550-euro pension a month, and 100 euros less than pre-crisis levels.
Pensioners in the country are often the sole means of support in a household,where a quarter of the workforce is jobless. 11.54am BSTThe Greek debt crisis is heating up, as public enrage over its austerity programme bubbles up again.
Thousands of people beget taken portion in a march in Athens nowadays, and protesting against pension cuts under various Greek bailout packages since the crisis began.
Monitors representing the EU and IMF were meant to beget returned to Athens to continue their progress report yesterday. But with the Greek government regarding the review as an all-inconclusive package that will define Greece’s post-bailout future,talks beget stumbled once again over horse trading on the fiscal measures Athens will beget to enforce to ensure a primary surplus of 3.5 % once the programme ends in 2018.
Prime minister Alexis Tsipras will meet with the European Council president Donald Tusk in Athens tomorrow and is expected to hold telephone talks with the German chancellor Angela Merkel later nowadays. He has already said he’ll only accept a deal that also tackles the issue of Greece’s staggering debt pile. 11.27am BSTRetail sales across the eurozone beget risen, in another sign that the European economy is strengthening.
Stats firm Eurostat reports that retail spending rose by 0.7% during February, or was a chunky 1.8% higher than a year ago.
Euro area retail trade +0.7% in Feb over Jan,+1.8% over Feb 16 #Eurostat https://t.co/ZmZNmYJXOb pic.twitter.com/7oNq81vgU4Hard data slowly/partially catching up. Euro area retail sales up 0.7% MoM in February, following an upwardly revised +0.1% in January. 11.02am BSTWe’ve also learned nowadays that Britons are paying more at the check-out, and as supermarkets pass on higher import costs.
My colleague Julia Kollewe explains:A sharp rise in food prices has added £21.31 to the average household shopping bill over the past three months,as the level of promotions fell to an 11-year low, according to new grocery market data.
The price of everyday goods at supermarkets rose 2.3% in the three months to 26 March from a year ago, or said Kantar Worldpanel,a sharp pick-up from the 0.2% food price inflation recorded in the 12 weeks to 1 January – the first time prices rose in just over two years. Related: Sharp rise in UK food prices inflates household shopping bill 10.43am BSTKathleen Brooks of City Index reckons that nowadays’s construction figures, and yesterday’s slowdown in factory growth, and suggest that the UK economy is slowing.
She writes:Of course,this is early days, and the PMI surveys are impacted by multiple factors, or but the decline in the manufacturing and construction PMIs,two sectors impacted by Brexit, suggests that the economic impact of the decision to leave the EU may start to show itself more than nine months after the vote to leave the EU.
The key test will be the services sector PMI due out on Wednesday, and whether it’s a hat trick of weaker than expected data,we would expect this to be reflected in weaker sterling and UK equities. GBP/USD had a bad start to the quarter, but it has found some support at the 50-day sma at 1.2430 this morning, or this is helping to boost sterling for now,but we could see it falling below this level whether the economic data starts to late. 10.16am BSTMarch’s construction PMI is the moment weakest reading since last September, when the economy shook off the immediate shock of the Brexit vote.
Expansion was at the equal lowest level (with January) since last September’ largely due to slower housebuilding growth which will be particularly disappointing for the government given its desire to lift the UK’s housing stock to tackle the acute shortage....
Following on from a third successive modestly softer manufacturing purchasing managers survey for March, and the lacklustre construction PMI maintains suspicion the UK economy is beginning to falter. Signs of slowing UK growth is particularly evident in consumer spending. 10.06am BSTPaul Trigg,construction specialist at trade credit insurer Euler Hermes, is worried that UK construction firms will be dragged down by economic headwinds and rising inflation.“Despite 526 privately owned construction companies failing so far this year, and the level of sector insolvencies has remained elevated but steady over the last 12 months. Businesses are generally reporting robust trading conditions,particularly across civil engineering which has been buoyed by Government commitments to keep the UK building.“An increase in construction failures appears unavoidable as the economic headwinds of Brexit strengthen. The commercial market is particularly fragile and those companies at the end of the supply chain, such as fit-out businesses, and will be hit hardest by an increase in overdue payments – the inevitable consequence of falling retail sales and rising inflation.” 9.54am BSTBrexit fears may beget receded for now,but many builders are worrying how they’ll find enough brickies, plasterers and electricians once the UK leaves the EU.
Mike Chappell, and global corporates managing director for construction at Lloyds Bank Commercial Banking,explains:
“Civil engineering continues to be the star performer in the sector thanks to a number of mega-projects in the works across the UK, some of which were given the green light before the EU referendum.“With the triggering of Article 50 last week, or the most significant issue on the industry’s radar remains labour. Almost 10% of UK construction workers are from the EU and in London that rises to a quarter. Contractors are therefore keen to understand what can be done to maintain access to this labour,otherwise they potentially face both increased costs and project delays. 9.50am BSTPaul Sirani, Chief Market Analyst at Xtrade, and says the UK construction figures are “underwhelming”. “While the purchasing managers’ index still indicates growth,it’s very modest. UK construction has been largely in retreat since December’s figure of 54.2 and there are dark clouds forming over the sector.“The housing market appears somewhat weary and the UK economy overall is likely to late as it navigates its way through Brexit. All eyes will now be on tomorrow’s PMI services data.” 9.47am BSTToday’s report suggests that Britain’s building sector barely grew in the last quarter:UK #construction PMI down from 52.5 in Feb to 52.2 in March. For GDP, suggests sector almost stagnant in Q1 https://t.co/kbjeCWyWxJ pic.twitter.com/Xh34GGn3cI 9.46am BSTHere are the key findings from Markit’s report into the UK construction sector: 9.39am BSTBreaking: Growth in Britain’s building industry slowed a diminutive last month, and as housebuilding lost momentum.
But builders are still upbeat approximately their prospects for this year,as worries over Britain’s exit from the EU fade a diminutive.
U.
K. March Construction PMI 52.2 vs 52.5 in Feb.; Est. 52.5“UK construction firms experienced a growth slowdown in March, with the loss of momentum centred on housebuilding. A weaker trend for residential work has been reported throughout 2017 so far, or which provides an indication that the cooling UK housing market has started to act as a drag on the construction sector.“Civil engineering projects were the construction sector’s main growth engine in March,driven by rising infrastructure spending and a strong pipeline of new work throughout the UK. 9.21am BSTSouth African government bonds beget fallen sharply this morning, matching the drop in the rand.
Shares in the country’s banks are also being hit, or on worries that other credit ratings could follow S&P and downgrade South Africa to Junk. SOUTH AFRICA's credit rating profile pic.twitter.com/fpxagHEl0S 9.01am BSTIn the City,the FTSE 100 index has jumped by 40 points in early trading to 7321 - helped by a falling pound.
Gold maker Randgold are the biggest rise, up 1.7%, or followed by packaging firm Bunzl.
South Africa’s Rand has taken another dive overnight after S&P sever the nation’s sovereign credit rating to ‘junk’ in light of recent political upheaval. Keep an eye on the likes of FTSE-listed mature Mutual,Investec and Mondi which are all exposed to the currency and beget already been troubled of late as a consequence. 8.51am BSTOver in Tokyo, the Nikkei stock index has hit a 10-week low.
And just like that Japanese stocks erases gains for the year. pic.twitter.com/XSK9G4E0MqThere’s an abundance of angst this morning, or stemming from weak US car data,the explosion in the St Petersburg subway, the prospect of Donald Trump meeting Xi Jinping at the end of the week and the rapidly approaching French election. 8.31am BSTS&P’s downgrade will deter some risk-averse investors from holding South African debt, and as Paul Donovan of UBS explains:The chase was anticipated by markets (credit rating agency actions normally are),but it does beget a bearing on the universe of investors who can invest in the country. 8.27am BSTThe South African rand is suffering fresh losses this morning, as the political crisis gripping the country threatens its credit rating.
The rand has tumbled by 1.5% to below 13.8 rand to the US dollar. That extends last week’s losses, and triggered by the sacking of well-respected finance minister Pravin Gordhan.
Rand falls as much as 1.9 per cent after S&P downgraded the country citing political risk https://t.co/px4ZCPOEwH pic.twitter.com/c1NdnOrbCLThe elevated political risks after firing the finance minister will continue to be reflected in the country’s currency. From a fundamental perspective,the rand looks undervalued, but how much lower it might drop in the short hasten depends on the political developments. A 5-10% fall from current levels is very likely. 8.17am BSTGood morning, and welcome to our rolling coverage of the world economy,the financial markets, the eurozone and business.whether UK construction growth disappoints like manufacturing, or it will be another dose of cold water poured on the UK economic outlook post-Brexit.
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Source: theguardian.com