This article is from the source 'guardian' and was first published or seen on . It last changed over 40 days ago and won't be checked again for changes.
You can find the current article at its original source at https://www.theguardian.com/business/live/2017/jul/14/investors-cheered-as-us-rate-hike-expectations-fade-business-live
The article has changed 13 times. There is an RSS feed of changes available.
| Version 3 | Version 4 |
|---|---|
| Investor relief as US rate hike expectations fade - business live | Investor relief as US rate hike expectations fade - business live |
| (35 minutes later) | |
| 10.36am BST | |
| 10:36 | |
| Analysts at TS Lombard said Chinese leaders will be hoping to settle differences at this weekend’s National Financial Work Conference: | |
| This year’s meeting has attracted particular attention after Xi Jinping is said to have demanded better regulatory coordination following the July 2015 stock market correction and large-scale capital outflows in H2/15. There had been discussion of moving the meeting up to summer 2016 – half a year ahead of schedule. In the end, however, the meeting, which should have been held in January, has ended up being delayed by disagreements about how to approach regulation. | |
| These disagreements have centred around a potential restructuring of the regulatory system. | |
| The final decision has not been made, but reports are that a new People’s Bank of China-led office will be established with representatives from other regulators and key government bodies such as the Ministry of Finance and the Development and Reform Commission. | |
| 10.26am BST | |
| 10:26 | |
| RBS share sale in 2015 was 'value for money' for taxpayers | |
| The sale of government shares in bailed out bank Royal Bank of Scotland was “value for money” despite losses for the taxpayer of nearly £2bn. | |
| That’s the verdict of the public spending watchdog, the National Audit Office, which has published a report on the controversial sale of a 5.4% two years ago. | |
| The NAO concluded the sale was “well planned and organised and represented value for money”. | |
| The Press Association reports: | |
| The sale came under heavy criticism at the time after the Government offloaded its first tranche of shares in RBS at a 52-week low. | |
| There was also speculation over leaked information after shares plunged 8% in the three days before the sale as hedge funds bet against RBS. | |
| It was originally estimated that the 2015 share sale saw losses of £1.1 billion on the price paid under the £45.5 billion bailout of RBS at the height of the financial crisis. | |
| But the NAO said, taking into account costs of financing the rescue, losses on the stake sale soared to £1.9 billion. | |
| It comes a day after RBS was ordered to pay $5.5bn (£4.2bn) to US regulators for misselling toxic mortgage bonds: | |
| Updated | |
| at 10.26am BST | |
| 9.43am BST | 9.43am BST |
| 09:43 | 09:43 |
| John Lewis: 'lipstick effect' takes hold as consumers grow cautious | John Lewis: 'lipstick effect' takes hold as consumers grow cautious |
| John Lewis says consumers are increasingly unwilling to spend money on big ticket items as confidence wanes and incomes are squeezed by higher prices and weak wage growth. | John Lewis says consumers are increasingly unwilling to spend money on big ticket items as confidence wanes and incomes are squeezed by higher prices and weak wage growth. |
| Paula Nickolds, the new chief executive of Britain’s biggest department store, said demand had dropped for the larger, non essential purchases. However the ‘lipstick effect’ appears to have kicked in, where cash-strapped consumers are more willing to buy less costly luxurious goods, instead of that new TV or piece of furniture. | Paula Nickolds, the new chief executive of Britain’s biggest department store, said demand had dropped for the larger, non essential purchases. However the ‘lipstick effect’ appears to have kicked in, where cash-strapped consumers are more willing to buy less costly luxurious goods, instead of that new TV or piece of furniture. |
| Nickolds told journalists at a press dinner: | Nickolds told journalists at a press dinner: |
| It’s the more considered categories, the arguably deferrable spend, that we’re seeing most affected by the uncertainty in the macro conditions - so those big ticket categories are currently trading just behind last year. | It’s the more considered categories, the arguably deferrable spend, that we’re seeing most affected by the uncertainty in the macro conditions - so those big ticket categories are currently trading just behind last year. |
| “We believe [spontaneous categories such as beauty] to be significantly ahead of the market. Perhaps it’s the lipstick effect as we might have called it back in the recession [of 2008].” | “We believe [spontaneous categories such as beauty] to be significantly ahead of the market. Perhaps it’s the lipstick effect as we might have called it back in the recession [of 2008].” |
| Acknowledging the challenging consumer backdrop, Nickolds said: | Acknowledging the challenging consumer backdrop, Nickolds said: |
| I would have preferred to start my first year as managing director of John Lewis in slightly more benign conditions. The backdrop is very uncertain and it was made worse by the tragic events that happened across British cities over the last few months. | I would have preferred to start my first year as managing director of John Lewis in slightly more benign conditions. The backdrop is very uncertain and it was made worse by the tragic events that happened across British cities over the last few months. |
| Consumers feel uncertain and worried about what the circumstances will mean for their future financial prosperity. | Consumers feel uncertain and worried about what the circumstances will mean for their future financial prosperity. |
| 9.05am BST | 9.05am BST |
| 09:05 | 09:05 |
| Carillion shares rise after it names HSBC as adviser | Carillion shares rise after it names HSBC as adviser |
| Some respite for Carillion this morning with shares up 4.6% at 60p, making the building group the top riser on the FTSE 250. | Some respite for Carillion this morning with shares up 4.6% at 60p, making the building group the top riser on the FTSE 250. |
| After heavy losses every day this week, shares have been boosted by the news that the troubled company has appointed HSBC as its joint financial adviser and joint corporate broker. | After heavy losses every day this week, shares have been boosted by the news that the troubled company has appointed HSBC as its joint financial adviser and joint corporate broker. |
| Analysts at investment bank Jefferies warned earlier this week that Carillion was unlikely to survive without a hefty rights issue of at least £500m. | Analysts at investment bank Jefferies warned earlier this week that Carillion was unlikely to survive without a hefty rights issue of at least £500m. |
| Carillion is a major contractor to customers such as the Highways Agency and Network Rail and investors panicked on Monday when it revealed an £845m writedown against customer payments it no longer expected to be able to collect. | Carillion is a major contractor to customers such as the Highways Agency and Network Rail and investors panicked on Monday when it revealed an £845m writedown against customer payments it no longer expected to be able to collect. |
| At the same time it announced chief executive Richard Howson had immediately stepped down. Over subsequent days 70% of its market value was wiped out as shares plummeted. Shares were worth 200p a month ago. | At the same time it announced chief executive Richard Howson had immediately stepped down. Over subsequent days 70% of its market value was wiped out as shares plummeted. Shares were worth 200p a month ago. |
| A reminder of how events unfolded: | A reminder of how events unfolded: |
| 8.37am BST | 8.37am BST |
| 08:37 | 08:37 |
| European markets flat in early trading | European markets flat in early trading |
| European markets are steady in early trading, with only small moves. | European markets are steady in early trading, with only small moves. |
| FTSE 100: -0.03% at 7,411 | FTSE 100: -0.03% at 7,411 |
| Germany’s DAX: -0.1% at 12,633 | Germany’s DAX: -0.1% at 12,633 |
| France’s CAC: +0.03% at 5,237 | France’s CAC: +0.03% at 5,237 |
| Italy’s FTSE MIB: -0.03% at 21,516 | Italy’s FTSE MIB: -0.03% at 21,516 |
| Spain’s Ibex: +0.04% at 10,663 | Spain’s Ibex: +0.04% at 10,663 |
| Europe’s STOXX 600: +0.03% at 386 | Europe’s STOXX 600: +0.03% at 386 |
| 8.26am BST | 8.26am BST |
| 08:26 | 08:26 |
| China holds latest five-yearly finance meeting | China holds latest five-yearly finance meeting |
| China’s leaders gather every five years to discuss ways to improve the financial system of the world’s second largest economy. | China’s leaders gather every five years to discuss ways to improve the financial system of the world’s second largest economy. |
| The next meeting of the National Financial Work Conference takes place today and tomorrow in Beijing and President Xi Jinping is expected to attend. | The next meeting of the National Financial Work Conference takes place today and tomorrow in Beijing and President Xi Jinping is expected to attend. |
| Items on the agenda are likely to include reining in financial risk, and giving the central bank a bigger role in overseeing other financial regulators. | Items on the agenda are likely to include reining in financial risk, and giving the central bank a bigger role in overseeing other financial regulators. |
| Some background on the history of the meeting from Bloomberg: | Some background on the history of the meeting from Bloomberg: |
| The meeting has held a special place in China’s economic and political calendar since it was introduced to encourage more sustainable economic growth following the Asian financial crisis. | The meeting has held a special place in China’s economic and political calendar since it was introduced to encourage more sustainable economic growth following the Asian financial crisis. |
| The first conference in 1997 saw the establishment of an insurance regulator and a plan to bail out China’s largest banks. The second led to the creation of a banking regulator and a drive to list major state-owned lenders on overseas stock exchanges. | The first conference in 1997 saw the establishment of an insurance regulator and a plan to bail out China’s largest banks. The second led to the creation of a banking regulator and a drive to list major state-owned lenders on overseas stock exchanges. |
| The 2007 conference oversaw the creation of the sovereign wealth fund, China Investment Corp., which now has $813.5 billion of assets. The meeting in 2012 focused on the fallout from the global financial crisis. | The 2007 conference oversaw the creation of the sovereign wealth fund, China Investment Corp., which now has $813.5 billion of assets. The meeting in 2012 focused on the fallout from the global financial crisis. |
| 7.54am BST | 7.54am BST |
| 07:54 | 07:54 |
| The agenda: all eyes on US data as rate expectations fade | The agenda: all eyes on US data as rate expectations fade |
| Good morning, and welcome to our rolling coverage of the world economy, the financial markets, the eurozone and business. | Good morning, and welcome to our rolling coverage of the world economy, the financial markets, the eurozone and business. |
| European markets are expected to follow Wall Street higher this morning as investors continue to digest the more cautious tone from Fed chair Janet Yellen. | European markets are expected to follow Wall Street higher this morning as investors continue to digest the more cautious tone from Fed chair Janet Yellen. |
| A rate hike in December is no longer looking like a foregone conclusion after Yellen highlighted weak inflation as a factor weighing on the minds of policymakers. | A rate hike in December is no longer looking like a foregone conclusion after Yellen highlighted weak inflation as a factor weighing on the minds of policymakers. |
| Michael Hewson from CMC Markets explains: | Michael Hewson from CMC Markets explains: |
| The Dow Jones posted another record close, while the US dollar remained under pressure as markets adjusted to how the next moves on monetary policy might play out. | The Dow Jones posted another record close, while the US dollar remained under pressure as markets adjusted to how the next moves on monetary policy might play out. |
| The prospect that further interest rate rises may well be much more gradual, if they happen at all, shouldn’t have been entirely unexpected given the risks involved in trying to withdraw stimulus and raise rates at the same time, nonetheless judging by the market reaction it appears to have gone down fairly well. | The prospect that further interest rate rises may well be much more gradual, if they happen at all, shouldn’t have been entirely unexpected given the risks involved in trying to withdraw stimulus and raise rates at the same time, nonetheless judging by the market reaction it appears to have gone down fairly well. |
| With that in mind, investors will be focused on the latest US inflation data, due at 13.30 UK time. It is expected to show consumer price inflation remained at a fairly subdued 1.7% in June. | With that in mind, investors will be focused on the latest US inflation data, due at 13.30 UK time. It is expected to show consumer price inflation remained at a fairly subdued 1.7% in June. |
| US retail sales data for June will also be published at 13.30, and are expected to show the sector managed growth of just 0.1% last month, following a 0.3% drop in sales in May. | US retail sales data for June will also be published at 13.30, and are expected to show the sector managed growth of just 0.1% last month, following a 0.3% drop in sales in May. |
| Traders at spread betting firm IG expect European markets to open higher: | Traders at spread betting firm IG expect European markets to open higher: |
| Our European opening calls:$FTSE 7421 +0.11%$DAX 12647 +0.05%$CAC 5244 +0.16%$IBEX 10679 +0.20%$MIB 21547 +0.12% | Our European opening calls:$FTSE 7421 +0.11%$DAX 12647 +0.05%$CAC 5244 +0.16%$IBEX 10679 +0.20%$MIB 21547 +0.12% |