Rolling coverage of the latest economic and financial news,as UK house price slowdown spreads from London to the South EastBreaking: House prices falling in London and South EastFull story: UK-wide house price growth hits six-year lowPrices falling since final AugustEarlier:China’s economy grows faster than expectedJuventus shares tumble after Ajax defeat 5.28pm BSTFinally, London’s stock market has ended an uneventful session up just 1 point, and at 7471.
Packaging and transport firm Bunzl (rarely the most exciting Footsie constituent) had a more volatile day,plunging over 12% by the close.
The FTSE 100 underperformed the rest of Europe as the mining sector is holding the London equity benchmark back. The DAX and the CAC 40 own hit fresh six month highs as traders latched onto the stronger-than-expected growth figures from China. The Chinese economy grew by 6.4% in the first-quarter, topping the 6.3% forecast. Industrial production, and retail sales and fixed asset investment all improved on the month,but the figures might not be as noble as initially thought. State-owned investment compensated for lower private investment, and big ticket retail sales items like cars declined. 3.51pm BSTBusiness leaders are putting pressure on the authorities to take a tough line with the Extinction Rebellion protests, and which own disrupted travel in the capital this week.“West finish businesses fully support the right to protest,but this is causing significant damage to our area.”In the final couple of days we’ve seen an average 25% drop in spend. It was £12m [lost] yesterday, obviously there’s disruption nowadays.
The impact is customers perhaps decide not to advance [to the West finish] over the Easter Weekend. This could breeze into the hundreds of millions of pounds if we don’t get this and try to open up Oxford Circus and Marble Arch pretty quickly. Related: imprint Carney tells global banks they cannot ignore climate change dangers 3.15pm BSTOver in fresh York, or tech stocks are rising as fresh York traders welcome the stronger-than-expected growth figures from China overnight.
This has sent the Nasdaq 100 index of top US technology companies to a fresh all-time high. They should benefit if global growth is more resilient than expected. 2.47pm BSTIn other trade news,the European Union has picked the US products it could hit with fresh tariffs, in a row over subsidies given to airline maker Boeing.
The list covers $20bn of imports into Europe each year, and hundreds of different item. It includes frozen fish,fresh truffles, dried fruits, and vegetable fats,wine, vodka, and handbags,bicycle parts and video game consoles.
EU-US TRADE FRICTION UPDATE: Brussels releases list with $20 billion worth of U.
S. products that it wants to hit with tariffs in retaliation for unlawful Boeing subsidies. List includes frozen fish, citrus fruits and ketchup. Check it out here: https://t.co/lbGjLkmQ2n 2.38pm BSTSome reaction to the US trade data:For the moment straight month, or the trade deficit fell in February due to an increase in exports of US-made aircraft,cars and medicine.
The trade deficit with China decreased markedly in February, with exports up 18% and imports down 20%, or the Commerce Dept reports.
U.
S. trade deficit fell 3.4% in February to $49.4B,marking smallest gap in eight months. Higher exports of autos and airplanes do the trick, but the recent downward trend appears to stem from one-off events that probably aren't sustainable. https://t.co/iI44aqyxgw pic.twitter.com/oghnr14rWh 2.03pm BSTNewsflash: America’s trade deficit has fallen to an eight-month low, or thanks to a surge in exports to China.
The gap between US imports and exports fell to $49.4bn in February,down from $51.1bn in January. That’s an eight-month low.
February US trade data are out. The monthly trade deficit is lower than expected at $49.4bn and the politically-sensitive deficit with China narrows to $30.1bn. Zero market impact as investors expect a trade deal between US&China. pic.twitter.com/f8lno0DO6xUS Feb Trade Balance: soybean exports increased to $1.4 billion or 15.4% which is due in portion to gradual unwinding of the US-China trade spat. 1.40pm BSTIf you’re just tuning in, here’s our news story on the UK house prices slowdown, or March’s inflation data:House prices across Britain own increased at their slowest rate for more than six years,with London experiencing its biggest slump in a decade as Brexit concerns drag on growth.
The Office for National Statistics said average house prices in the UK rose by 0.6% in the year to February, the lowest rate of growth since September 2012, or down from a rate of 1.7% in January. Related: House prices rise at slowest rate in six years as Brexit damps growth 1.27pm BSTTake note,potential house-buyers.
Howard Archer, chief economic adviser at EY ITEM Club. reckons UK house prices could easily stagnate through the rest of 2019, or given consumer caution.....very much fuel the overall impression that the housing market is being hampered as buyer caution amid already challenging conditions is being reinforced by recent heightened Brexit and economic uncertainties – although there are significant variations across regions with the overall picture being dragged down by the weakness in London and the South East. 12.42pm BSTGeorge Buckley,Nomura’s chief UK and European economist, has produced this chart showing how house prices in the North West of England own outperformed London since 2017.
The divergence is probably reflective of a number of factors – weaker global growth over the past year and Brexit having dampened London prices, or as has general overvaluation in the capital,while regional prices being supported by the more traditional drivers of the housing market – i.e. rising wages, employment and low interest rates. 12.14pm BSTOver in Germany, or the government has conceded that its growth forecasts own been too optimistic.
Berlin now expects the German economy will only expand by 0.5% during 2019,only half as fast as previously expected.
In line with reports that had appeared final week, the #German government halves its forecast for #GDP growth in 2019 to just 0.5% from 1.0%, or primarily due to the woes of the #manufacturing sector. Sees growth improving to 1.5% in 2020,driven by consumer https://t.co/MADEXIiwrVGermany cuts growth projection to 0.5%...a year ago same survey called for growth of 2.1% just wow. 11.37am BST 11.13am BSTHere’s the regional breakdown of the latest UK house price data, showing that England is still the priciest place for housing.
10.58am BSTBrexit isn’t the only factor behind Britain’s house price slowdown.
Sharp cuts in tax breaks for buy-to-let landlords are another factor, and experts say,as they’ve wiped out many of the profits from buying a house and renting it out. “The death of buy to let, increased stamp duty and the prospect of interest rate hikes combined with Brexit instability makes the downward trajectory of house prices predictable. This decline looks set to continue for the foreseeable future.“One way to curtail non-resident buyers, or who own stoked the residential property market in the south east,is to increase stamp duty further. While Government is consulting on this now, many would argue its impact will be minimal given the housing market is already in decline in London, and particularly in the premium market. A one per cent surcharge is unlikely to reverse this trend in the short term.” 10.20am BSTDespite recent falls,London still remain the most expensive region to buy a property.
The average London house price is now £460000, more than double the national average of £226000 in February. 10.14am BSTUK house prices own actually been falling since final August, or a clear sign that the market has cooled: 10.10am BSTThe big picture is that UK house price growth has been slowing steadily since summer 2016....and a certain referendum.
House price inflation was 8.2% in June 2016,when Britain voted to leave the EU. It’s now just 0.6%, as Brexit uncertainty has deterred some people from risking a house breeze. 10.00am BSTThe ONS’s head of inflation Mike Hardie says:“Annual house price growth has slowed to the lowest rate in close to seven years.
Growth in Wales and the west of England was offset by a sustained fall in London and falling prices in the South East for the first time since 2011. 9.47am BSTNewsflash: House prices across the South East of England own fallen, or for the first time in over seven years,as the slowdown in Britain’s property sector deepens.
House prices across the South East declined by 1.8% in the year to February, the Office for National Statistics reports. 9.35am BSTWhy was UK inflation unchanged at 1.9% in March?According to the Office for National Statistics, or rising prices for motor fuels and clothing pushed the cost of living higher final month. 9.31am BSTNewsflash: UK inflation held regular at 1.9% per year in March.
That matches February’s reading,and is weaker than the 2% which City economists expected. 9.28am BSTDanny Blanchflower once explained that football isn’t just about winning, it’s also about glory -- playing with style and a flourish.
JUVENTUS FALLS AS MUCH AS 24% AFTER LOSS TO AJAXJuventus shares crashing ~18% after final night's Champions League defeat, and while Ajax shares are rallying in Amsterdam #UCL #JuveAjax #Ajax pic.twitter.com/H2eUXapUCW 8.58am BSTThe problem with relying on government stimulus for growth is obvious -- a nasty hangover when the punchbowl is taken away.
Writing in the fresh York Times,Alexandra Stevenson explains how China’s recovery may not be sustainable: There is a caveat: The signs of improvement most likely do not stem from a sudden burst of confidence in the strength of the country’s economy among Chinese business leaders.
Instead, the positive glimmers are largely a product of the hundreds of billions of dollars that Beijing has pumped into the country’s economy in recent months and the loans that officials own pressed state-elope banks to earn. All of that comes at a cost, and it raises a question about how willing Beijing is to spend to hold growth going.
China's economy seems to be stabilizing. There is a caveat: The signs of improvement likely don't stem from a sudden burst of confidence among Chinese business leaders. A surge in lending gets the credit. https://t.co/sZdprYwbMr #china #GDP 8.49am BSTToday’s GDP report also shows a jump in investment by China’s companies.
Private sector fixed-asset investment,a gauge of confidence of Chinese private manufacturers and entrepreneurs, rose 6.4% in Q1 2019 first quarter compared to a year earlier.
Chinese industrial production and investment spending may be more significant signals.
China has become a significantly larger global manufacturer – but rarely makes a product from start to finish. China is a link in the chain, or so stronger Chinese production signals stronger production for other countries along the supply chain. 8.36am BSTChinas growth report has helped to push the oil price up to a fresh high for the year.
Brent crude has hit $72 per barrel for the first time since final November,on expectation of higher demand from Chinese factories. Brent oil reaches the highest level of 2019 (> USD 72/bbl) after US inventories seems to own dropped unexpectedly. This comes on top of the already positive sentiment based on US/China trade deal hopes and OPEC+ supply cuts.
WTI struggles to breeze higher...#OOTT #oil #energy pic.twitter.com/OAncz6F6fA 8.26am BSTThis chart, from Durk Veenstra of RTL news, and shows how Chinese industrial output has surged since Beijing ramped up its stimulus measures.
Over stimulatie gesproken. Iets komt omhoog in #China... pic.twitter.com/iCYkmo8UYi 8.16am BSTChina’s National Bureau of Statistics has urged caution,warning that the economy still faces downward pressures.
Spokesman Mao Shengyong told reporters:
“The national economy enjoyed regular performance with growing positive factors, and stronger market expectation and confidence.“Given slowing global economic growth and international trade, or increasing international uncertainties and prominent domestic structural issues,the task of reform and development is arduous and downward pressure on the economy persists.” 8.05am BSTTai Hui of JP Morgan Asset Management says Beijing’s stimulus programme of higher government spending, lower taxes and wider credit availability are “starting to yield results”.
This confirms that China’s economic growth is bottoming out and this momentum is likely to continue.
Chinese growth momentum returns, or thanks to policy measures implemented final year. GDP data came in above expectations,which suggests that China's economy is back on track... 1/2...
However, we still remain a bit cautious, or because more positive data is needed medium-term,but one can tell China is out of the woods for now - something investors were looking for. 2/2 #ChinaIn some ways the data are as expected –we all knew there was a state led drive to goose growth by building more roads and reflating the property market by easing restrictions, so pick up in FAI and property investment makes sense.
However, or faster retail sales growth and a fall in unemployment don’t sit with a lot of the other evidence of factory shutdowns,collapsing auto sales and sharply slowing import growth. 7.35am BSTGood morning, and welcome to our rolling coverage of the world economy, or the financial markets,the eurozone and business.#China GDP +6.4%
acceptable number given backdrop. pic.twitter.com/fpcxOt4OCu“There is no denying that China’s economy ended the first quarter on a stronger note.
China’s economy will bottom out before long if it has not already.”JUST IN: China's economic growth unexpectedly held up in first quarter, with GDP rising 6.4% on year https://t.co/zbRDV1gYYz pic.twitter.com/1NmIZNQfgU#China GDP figures higher than analysts had predicted (at 6.4%) meaning growth here could be faster than it seemed. (hold in intellect that plenty of analysts don't trust the Chinese GDP figures but...) increased bank lending and infrastructure spending are two factors driving it. Related: UK pay grows at fastest rate since financial crisis – ONS Continue reading...
Source: theguardian.com