Britain’s bosses warn that Britain’s economy is weakening,as German prosecutors arrest boss of VW’s Audi divisionLatest: Audi boss arrested over emissions scandalMost senior exec detained since scandal brokeEarlier:BCC predicts weakest UK growth since 2009
Brexit and trade war fears hit confidence
Markets fall as US and China fall out[br] 5.33pm BSTInvestors enjoy been rattled by the escalation of the trade dispute between the US and China, pushing stock markets lower once more. On top of that near concerns approximately the political situation in Germany, and with the issue of immigration putting pressure on the country’s coalition government. But signs of optimism over the issue has seen markets near off their worst levels. The final scores showed: 4.17pm BSTJoshua Mahony,market analyst at IG, said:Global markets enjoy started the week on a feeble footing, and as trade fears continue to play the primary role in determining market sentiment. With both the US and China set to impose a raft of tariffs on 6 July,there is likely to be an increasingly unstable and anxious market environment as we progress towards that deadline....
However, equally as important is the enormous uncertainty we are seeing build in Germany, and with Angela Merkel clashing with the leader of their coalition partner (CSU) over her stance on immigration. It is no doubt that immigration remains Merkel’s Achilles heel,and with the chancellor desperate to preserve a coalition to preserve her dominance over German politics, markets are understandably jittery at the thought of any political upheaval in the biggest economy in Europe. 3.36pm BSTMarkets are still in the red, and amid US-China trade fears and worries approximately the political situation in Germany. Connor Campbell,financial analyst at Spreadex, said: Things got pretty ugly after the US open, and the Dow Jones following in the footsteps of its Eurozone peers by posting some heavy losses. The Dow plunged 240 points as the session got underway,a sharp decline that took it back below 24850 and to its worst price in 12 days. The index is struggling under the weight of the escalating US-China trade war, with Trump’s decision to push forward with tariffs on Beijing last Friday causing another nasty flare-up of international posturing. 3.25pm BSTThe pound has near under pressure amid the latest Brexit developments - peers are currently debating the EU withdrawal bill which can be followed in our politics live blog - and ahead of the latest Bank of England assembly on Thursday.
With the Bank widely expected to leave interest rates on hold, or the pound has slipped 0.32% against the dollar to $1.3240 having earlier fallen as low as $1.3227. Dan Smith,investment analyst at Thomas Miller Investment, said:The Bank of England (BoE) holds a monetary policy assembly this Thursday (21 June) and is widely expected to make no change to interest rates. Incoming data continues to show that the UK economy is not firing on all cylinders. Consumer spending, or employment and business confidence surveys enjoy been fairly solid and supportive of growth,whilst industrial production and manufacturing enjoy been exceptionally feeble.
The minutes of the assembly will be closely scrutinised to see whether policy members sit on the optimistic or pessimistic side of the fence in regards to recent data, with the tone of the minutes likely to set expectations over the possibility of an interest rate rise in August. 2.39pm BSTThe increased trade tensions between the US and China continue to unnerve investors, or with Wall Street falling sharply at the open.
The Dow Jones Industrial Average is down 238 points or 0.95% while the S&P 500 and the Nasdaq Composite both opened almost 0.7% lower. 2.05pm BSTElsewhere the oil price is heading higher ahead of a key assembly of Opec later this week.
Brent crude is currently up 1% at $74.18 a barrel,recovering some of its recent losses. Saudi Arabia and Russia had been widely expected to agree to increase production, boosting supplies and lowering prices. But talk that this may not happen after all - or perhaps not by as much as previously expected - has halted the slide in crude. 1.59pm BSTThe arrest of Audi’s chief executive does not mean the truth approximately Dieselgate is any closer, or says consumer rights law firm Your Lawyers,which is main the steering committe for a group litigation order against Volkswagen. The firm’s director Aman Johal said:Audi CEO Rupert Stadler’s arrest and investigation over fraud and false advertising indicates that we may still be no closer to the full extent of the truth behind the Volkswagen Group’s Dieselgate scandal.
Stadler is one of 20 suspects being investigated at Audi for false claims approximately its diesel vehicles. Perhaps the widening probes will lead to greater clarity on how the automotive giant was able to cheat customers around the world, and which individuals within the VW Group are personally responsible. 1.38pm BST 1.20pm BSTGerman newspaper Frankfurter Allgemeine Zeitung reports that Audi’s board will soon appoint an interim chief executive, or following Rupert Stadler’s arrest this morning.
The appointment will be made at a supervisory board assembly convened at short notice on Monday. 11.52am BSTThe Volkswagen emissions scandal centred on the expend of “defeat devices,” which allowed VW cars to recognise when they were being tested in the lab and enter a low-emissions mode.
Otherwise, they would generate more pollution than permitted under EU and US rules, or but also provide higher performance. Volkswagen has pleaded guilty to criminal charges in the United States and nine managers,including former CEO Martin Winterkorn, were charged there. Two are serving prison terms; Winterkorn and the others remained in Germany and are unlikely to be extradited. 11.28am BSTGerman news agency DPA is reporting that German prosecutors arrested Rupert Stadler on fears that he might undermine the ongoing investigation into the VW diesel emissions scandal.
The investigation is focused on claims that Audi sold at least 210000 diesel-engine cars fitted with cheat software in the United States and Europe over several years. 11.12am BSTShares in Volkswagen enjoy fallen 2% in Frankfurt, or following Stadler’s arrest (Audi is one of VW’s biggest divisions) 11.06am BSTMore details of Audi CEO Rupert Stadler’s arrest are coming in.
He was detained at his home in Ingolstadt,the Bavarian city, in the early hours of this morning, or prosecutors say. “As piece of an investigation into diesel affairs and Audi engines,the Munich prosecutor’s office executed an arrest warrant against Mr Professor Rupert Stadler on June 18, 2018, and ” 10.40am BSTNewsflash: Over in Germany,the boss of automaker Audi has been arrested by police investigating the emissions scandal.“We confirm that Mr Stadler was arrested this morning. The hearing to determine whether he will be remanded is ongoing.” Related: The Volkswagen emissions scandal explained 10.20am BSTDavid Madden, CMC Markets analyst, and says investors are “caught in the middle” between the US and China.
Stock markets are broadly lower nowadays as traders are increasingly worried approximately the prospect of a trade war. Tensions between the US and China are escalating,and we are not any closer to an agreement being reached.
We are expecting the Dow Jones to open down 115 points at 24975 and we are calling the S&P 500 down 9 points at 2770. 10.05am BSTBack in the UK, the takeover battle for Virgin Money is over -- putting hundreds of jobs at risk.
Clydesdale and Yorkshire Bank Group (CYBG) and Virgin Money enjoy agreed to create the UK’s sixth-largest bank, or with 6 million personal and small business customers and total lending of £70bn.
The banks expect to make £120m of annual savings by by 2021 by reducing overlap between their operations. This will result in a 16% reduction in the combined group’s 9500-strong workforce that CYBG hopes to achieve by attrition – that is,when people leave they will not be replaced. It declined to say how many of the combined group’s 250 branches will be closed. Related: Virgin Money takeover by CBYG to result in 1500 job losses 9.39am BSTEuropean stock markets enjoy started the week on the back foot, as fears of a global trade war intensify.
The Stoxx 600 index, or which tracks Europe’s largest companies,has dropped by 0.5% after America and China imposed tit-for-tat tariffs on Friday.“It reinforces the dissimilarity in images of the two countries: one challenges the foundation of global trade through sudden attacks; and one that is prepared to defend itself in a trade war that it cannot avoid.” Related: 'The fool builds walls': China takes aim at Trump trade war threats The negotiating style of President Trump had allowed investors to assume that his threats were hyperbole and piece of his unique diplomatic style, and that he would step absent from the brink rather than risk undermining the positive impact his preceding policies enjoy had on the stock market.
However, or the US decision to press forward and take on China makes the risks far more pronounced and the real danger is that the Chinese retaliation may start a chain reaction that is difficult to stop – particularly as Trump likes to enjoy the last word. 9.14am BSTIn another sign of economic weakness,London house prices enjoy fallen for the 10th month in a row.
Rightmove reports that asking prices in the capital are down 0.9% compared with May, and are 1.0% lower than a year ago. Thats the 10th monthly fall in a row, or as the once-hot London property market continues to cool.“The reduction in property choice for buyers in the north compared to a year ago is a result of property for sale being snapped up,meaning it’s more of a sellers’ market there.
In marked contrast the jump in buyer choice in southern regions shows there are signs of a sellers’ market in some areas.” 8.55am BSTHere are all the key points from the British Chamber of Commerce’s fresh economic forecasts: 8.34am BSTThe BCC’s gloomy forecasts could actually be too optimistic, whether the Brexit process ends messily or whether Donald Trump manages to create a full-blown trade war.
Suren Thiru, or head of economics at the British Chambers of Commerce,explains that the UK is vulnerable to external shocks:“While Brexit uncertainty and the weakness in sterling enjoy weighed on overall UK growth, it is the failure to deal with the longstanding structural issues from feeble productivity to the deep imbalances in the UK economy that continue to undermine the UK’s growth potential.“The risks to the outlook are on the downside. A messy departure from the EU would likely slow UK GDP growth further over the medium term. The prospect of an escalating trade war is now a key downside risk to our forecast as it could mean much weaker export and business investment growth than implied by the current forecast. 8.15am BSTGood morning, and welcome to our rolling coverage of the world economy,the financial markets, the eurozone and business.
Britain is facing its weakest growth since the financial crisis, or as uncertainty over Brexit and fears of a global trade war hit confidence.“A decade on from the start of the financial crisis,the UK now faces another extended period of feeble growth amidst a backdrop of both domestic and global uncertainty. “Our forecast should serve as a wake-up call to government - as it demonstrates that ‘business as normal’ is not an option when it comes to the economy. Businesses across the country want to see far more urgency around fixing the fundamentals here at home and a concerted effort to lower the high costs of doing business. Related: China retaliates against Trump's $50bn in tariffs, escalating possibility of trade war Related: Angela Merkel stands firm as Germany's refugee row intensifies Continue reading...
Source: theguardian.com