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Pound rises as Bank signals limited Brexit fallout - business live Pound rises as Bank signals limited Brexit fallout - business live
(35 minutes later)
3.55pm BST
15:55
While the FTSE 100 has been regaining ground since the shock Brexit vote and is now sitting at an 11 month high, the more UK focused FTSE 250 has yet to recover the level it reached ahead of the June 23 vote.
But the mid-cap index is getting there, and a rise of 1% to its current 17,080 leaves it only 250 points shy of its pre-referendum level. Investors appear to have been comforted by the fact that the worst predictions of disaster following a leave vote have yet to be realised, with even the IMF this week rowing back from its talk of a UK recession in the wake of Brexit.
3.46pm BST
15:46
US crude stocks fell last week much in line with expectations, with a draw of 2.34m barrels compared to a forecast 2.1m.
2.3M barrel crude oil draw last week according to EIA. #CrudeOil ^JC
But gasoline stocks rose unexpectedly, compared to expectations of no change:
US GASOLINE STOCKS rose +0.9 million bbl to 241 million bbl last week pic.twitter.com/aIBhQDwDx9
So crude prices remain lower but recovering from their worst levels, with West Texas Intermediate now down 0.9%, while gasoline future have hit their lowest since early March.
3.33pm BST3.33pm BST
15:3315:33
Further slip in #consumer confidence in July in wake of #Brexit vote adds to signs #eurozone consumption is slowing pic.twitter.com/8RqSkKcWUxFurther slip in #consumer confidence in July in wake of #Brexit vote adds to signs #eurozone consumption is slowing pic.twitter.com/8RqSkKcWUx
3.17pm BST3.17pm BST
15:1715:17
The consumer confidence figures, while not as bad as they could be, still show that Brexit could have an effect on EU economic activity, says economist Howard Archer at IHS Global Insight:The consumer confidence figures, while not as bad as they could be, still show that Brexit could have an effect on EU economic activity, says economist Howard Archer at IHS Global Insight:
While there are no details available, there can be little doubt that a second successive drop in Eurozone consumer confidence to a three-month low in July is largely the consequence of heightened concerns over the economic and political outlook following the UK’s vote to leave the European Union. The June consumer confidence survey - which showed modest slippage - had been completed before the UK vote on 23 June.While there are no details available, there can be little doubt that a second successive drop in Eurozone consumer confidence to a three-month low in July is largely the consequence of heightened concerns over the economic and political outlook following the UK’s vote to leave the European Union. The June consumer confidence survey - which showed modest slippage - had been completed before the UK vote on 23 June.
There may be an element of relief that July’s drop in Eurozone consumer confidence was not greater and it may alleviate some of the deepest concerns about how much Eurozone growth will be negatively impacted by the Brexit vote.There may be an element of relief that July’s drop in Eurozone consumer confidence was not greater and it may alleviate some of the deepest concerns about how much Eurozone growth will be negatively impacted by the Brexit vote.
Nevertheless the clear dip in Eurozone consumer confidence in July reinforces belief that the Brexit vote will have some dampening impact on Eurozone economic activity - particularly as the consumer has been a key growth driver for the Eurozone, notably in the first quarter of this year.Nevertheless the clear dip in Eurozone consumer confidence in July reinforces belief that the Brexit vote will have some dampening impact on Eurozone economic activity - particularly as the consumer has been a key growth driver for the Eurozone, notably in the first quarter of this year.
On the positive side, for now at least, the fundamentals still look pretty solid for consumers in the Eurozone with negligible inflation supporting purchasing power and labour markets significantly improved overall.On the positive side, for now at least, the fundamentals still look pretty solid for consumers in the Eurozone with negligible inflation supporting purchasing power and labour markets significantly improved overall.
Dennis de Jong, managing director at UFX.com, said these figures could mark the low point:Dennis de Jong, managing director at UFX.com, said these figures could mark the low point:
Consumer confidence in the EU had already dropped in the lead up to the Brexit vote and, in the uncertain aftermath, it’s no real surprise that the mood has worsened.Consumer confidence in the EU had already dropped in the lead up to the Brexit vote and, in the uncertain aftermath, it’s no real surprise that the mood has worsened.
In the UK, consumer confidence has actually come through robustly, which may be an indicator as to how the rest of EU consumers will respond.In the UK, consumer confidence has actually come through robustly, which may be an indicator as to how the rest of EU consumers will respond.
Suddenly the euro doesn’t look so shaky next to the falling pound, so there’s every chance we could be looking at a consumer confidence nadir in today’s numbers.”Suddenly the euro doesn’t look so shaky next to the falling pound, so there’s every chance we could be looking at a consumer confidence nadir in today’s numbers.”
3.12pm BST3.12pm BST
15:1215:12
European Union consumer confidence drops after BrexitEuropean Union consumer confidence drops after Brexit
In the wake of the UK’s vote to leave the EU, consumer confidence in the area fell sharply, new data shows.In the wake of the UK’s vote to leave the EU, consumer confidence in the area fell sharply, new data shows.
According to a flash estimate by the European Commission, consumer confidence in the EU as a whole dropped by “a marked” 1.8 points to -7.6 in July. This is the worst level for two years.According to a flash estimate by the European Commission, consumer confidence in the EU as a whole dropped by “a marked” 1.8 points to -7.6 in July. This is the worst level for two years.
In the eurozone, confidence fell by 0.7 points to -7.9, slightly better than the -8 figure expected by economists polled by Reuters. The June figure of -7.2 was revised up from the initial -7.3.In the eurozone, confidence fell by 0.7 points to -7.9, slightly better than the -8 figure expected by economists polled by Reuters. The June figure of -7.2 was revised up from the initial -7.3.
2.59pm BST2.59pm BST
14:5914:59
Oil is on the slide again ahead of US inventory figures, with West Texas Intermediate down 1.8% at $43.84, a two month low. The fall reflects continuing strength in the US dollar as well as concerns about a supply glut.Oil is on the slide again ahead of US inventory figures, with West Texas Intermediate down 1.8% at $43.84, a two month low. The fall reflects continuing strength in the US dollar as well as concerns about a supply glut.
2.52pm BST2.52pm BST
14:5214:52
Wall Street opens higherWall Street opens higher
US markets continue to move ahead, as Microsoft and Morgan Stanley continue the trend of companies reporting better than expected results.US markets continue to move ahead, as Microsoft and Morgan Stanley continue the trend of companies reporting better than expected results.
The Dow Jones Industrial Average is up around 13 points or 0.06% at 18572 having earlier hit a new peak of 18618. The S&P 500 opened up 0.26% and Nasdaq 0.48%.The Dow Jones Industrial Average is up around 13 points or 0.06% at 18572 having earlier hit a new peak of 18618. The S&P 500 opened up 0.26% and Nasdaq 0.48%.
2.35pm BST2.35pm BST
14:3514:35
Top 500 global companies see revenues and profits drop in 2015Top 500 global companies see revenues and profits drop in 2015
The world’s largest companies saw their revenues fall last year for the first time since 2010, according to the latest Fortune Global 500 list.The world’s largest companies saw their revenues fall last year for the first time since 2010, according to the latest Fortune Global 500 list.
Total revenues dropped 11.5% to $27.6trn from $31.2trn in 2014, with profits down 11.2% to $1.48trn. Fortune says:Total revenues dropped 11.5% to $27.6trn from $31.2trn in 2014, with profits down 11.2% to $1.48trn. Fortune says:
There are plenty of reasons for the reversal. A slowdown in China’s once-booming economy has affected companies worldwide. Growth in the U.S. and Europe remains modest at best. And sustained low oil prices have erased billions in sales for giant petroleum producers like Exxon Mobil, Royal Dutch Shell, and Sinopec. But one macroeconomic trend looms largest of all: the explosive comeback of the U.S. dollar and the wide-ranging impact of its renewed strength on global trade.There are plenty of reasons for the reversal. A slowdown in China’s once-booming economy has affected companies worldwide. Growth in the U.S. and Europe remains modest at best. And sustained low oil prices have erased billions in sales for giant petroleum producers like Exxon Mobil, Royal Dutch Shell, and Sinopec. But one macroeconomic trend looms largest of all: the explosive comeback of the U.S. dollar and the wide-ranging impact of its renewed strength on global trade.
The US had 134 companies on this year’s list, the highest number of any country, followed by China with 103 and 52 from Japan. The US added 6 new companies from the previous year, China added 5, and Japan lost 2, says Fortune. Chinese, Japanese and the US companies together accounted for 58% of the list. China only had 19 companies a decade ago.The US had 134 companies on this year’s list, the highest number of any country, followed by China with 103 and 52 from Japan. The US added 6 new companies from the previous year, China added 5, and Japan lost 2, says Fortune. Chinese, Japanese and the US companies together accounted for 58% of the list. China only had 19 companies a decade ago.
Britain currently has 26 Fortune Global 500 companies with 17 of them based in London (before any impact from Brexit of course.)Britain currently has 26 Fortune Global 500 companies with 17 of them based in London (before any impact from Brexit of course.)
Walmart is top of the list, as it has been eleven times since 1995. Apple appears in the top ten for the first time:Walmart is top of the list, as it has been eleven times since 1995. Apple appears in the top ten for the first time:
The full list and more details are here.The full list and more details are here.
2.11pm BST2.11pm BST
14:1114:11
Here’s link to the Moody’s report on UK banks (see 13.49):Here’s link to the Moody’s report on UK banks (see 13.49):
Brexit uncertainty drives UK banking system outlook to negative from stable https://t.co/RQ9S3nDNnqBrexit uncertainty drives UK banking system outlook to negative from stable https://t.co/RQ9S3nDNnq
UpdatedUpdated
at 2.11pm BSTat 2.11pm BST
1.52pm BST1.52pm BST
13:5213:52
US markets are expected to open higher following better-than-expected results from Microsoft and Morgan Stanley:US markets are expected to open higher following better-than-expected results from Microsoft and Morgan Stanley:
US Opening Calls:#DOW 18606 +0.26%#SPX 2170 +0.28%#NASDAQ 4626 +0.51%#IGOpeningCallUS Opening Calls:#DOW 18606 +0.26%#SPX 2170 +0.28%#NASDAQ 4626 +0.51%#IGOpeningCall
UpdatedUpdated
at 1.54pm BSTat 1.54pm BST
1.49pm BST1.49pm BST
13:4913:49
Moody’s has downgraded its outlook for the UK banking system to negative from stable because of the Brexit vote.Moody’s has downgraded its outlook for the UK banking system to negative from stable because of the Brexit vote.
Carlos Suarez Duarte, senior vice president at Moody’s:Carlos Suarez Duarte, senior vice president at Moody’s:
Increased uncertainty about the UK’s future trade relationship with the EU will likely lead to reduced confidence and lower investment and consumer spending in the UK.Increased uncertainty about the UK’s future trade relationship with the EU will likely lead to reduced confidence and lower investment and consumer spending in the UK.
This will, in turn, pressure revenues, asset quality and profitability metrics for all banks in the UK, though some are more resilient to these pressures than others.This will, in turn, pressure revenues, asset quality and profitability metrics for all banks in the UK, though some are more resilient to these pressures than others.
1.39pm BST1.39pm BST
13:3913:39
Larry ElliottLarry Elliott
Philip Hammond has had a dream start as chancellor according to Larry Elliott, the Guardian’s economics editor:Philip Hammond has had a dream start as chancellor according to Larry Elliott, the Guardian’s economics editor:
The Bank of England says there are no signs of a general slowing in activity. Consumers are still spending in the shops. The International Monetary Fund says the economy will slow sharply but will avoid a recession.The Bank of England says there are no signs of a general slowing in activity. Consumers are still spending in the shops. The International Monetary Fund says the economy will slow sharply but will avoid a recession.
It is still early days, of course. The full effects of the Brexit vote on the economy will only become apparent over months and years rather than in the four weeks that have so far passed since 23 June. As the Bank’s agents made clear in their monthly report, many companies were so stunned by the result they have yet to work out what to do next.It is still early days, of course. The full effects of the Brexit vote on the economy will only become apparent over months and years rather than in the four weeks that have so far passed since 23 June. As the Bank’s agents made clear in their monthly report, many companies were so stunned by the result they have yet to work out what to do next.
The IMF made a similar point in its updated World Economic Outlook. It noted that Brexit was still unfolding, which is obviously true.The IMF made a similar point in its updated World Economic Outlook. It noted that Brexit was still unfolding, which is obviously true.
That said, Hammond has not had the baptism of fire that many predicted. Forecasts from the remain camp – of which the new chancellor was a member – came thick and fast in the run-up to the referendum. All of them warned of severe and immediate consequences if the leave side won.That said, Hammond has not had the baptism of fire that many predicted. Forecasts from the remain camp – of which the new chancellor was a member – came thick and fast in the run-up to the referendum. All of them warned of severe and immediate consequences if the leave side won.
Read the full article here:Read the full article here:
Related: Britain's new chancellor hasn't had the baptism of fire many predictedRelated: Britain's new chancellor hasn't had the baptism of fire many predicted
1.31pm BST1.31pm BST
13:3113:31
Debbie Abrahams, Labour’s shadow work and pensions secretary, has commented on the earlier labour market figures.Debbie Abrahams, Labour’s shadow work and pensions secretary, has commented on the earlier labour market figures.
She says wage growth remains too weak. (It was 2.3% in the three months to May, or 2.2% excluding bonuses.)She says wage growth remains too weak. (It was 2.3% in the three months to May, or 2.2% excluding bonuses.)
It is welcome that there has been a fall in unemployment. However, under the Tories long term pay growth continues to be sluggish and our economy is over-reliant on low paid insecure work.It is welcome that there has been a fall in unemployment. However, under the Tories long term pay growth continues to be sluggish and our economy is over-reliant on low paid insecure work.
If Theresa May is serious about supporting working people we need to see serious action on tackling low pay and investing in the high-skilled high-wage jobs our economy needs.If Theresa May is serious about supporting working people we need to see serious action on tackling low pay and investing in the high-skilled high-wage jobs our economy needs.