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FTSE 100 hits fresh six-month low amid fears over trade, oil and rates – business live FTSE 100 hits fresh six-month low amid fears over trade, oil and rates – business live
(35 minutes later)
The UK FTSE 100 has just hit a new six-month low, as its early gains fizzle out.The UK FTSE 100 has just hit a new six-month low, as its early gains fizzle out.
The blue-chip index of leading sharews in London is now down 27 points at 6968.The blue-chip index of leading sharews in London is now down 27 points at 6968.
That’s its lowest level since the end of March, adding to last week’s losses.That’s its lowest level since the end of March, adding to last week’s losses.
This follows the weak trading in Asia (where Japan lost 1.8% and China fell 1.4%).This follows the weak trading in Asia (where Japan lost 1.8% and China fell 1.4%).
Russ Mould, investment director at AJ Bell explains:Russ Mould, investment director at AJ Bell explains:
“There is a noticeable lack of bargain hunters on Monday morning as last Friday’s rebound in select parts of the market fails to extend into the new working week.“There is a noticeable lack of bargain hunters on Monday morning as last Friday’s rebound in select parts of the market fails to extend into the new working week.
The FTSE 100 was down 0.1% in early trading at 6,988 with investors clearly lacking confidence to snap up stocks whose share prices were badly damaged in last week’s market sell-off.The FTSE 100 was down 0.1% in early trading at 6,988 with investors clearly lacking confidence to snap up stocks whose share prices were badly damaged in last week’s market sell-off.
The biggest riser is gold producer Randgold – a traditional ‘safe-haven’ in troubled times, with other ‘defensive’ stocks such as British American Tobacco and BT Group also in demand.The biggest riser is gold producer Randgold – a traditional ‘safe-haven’ in troubled times, with other ‘defensive’ stocks such as British American Tobacco and BT Group also in demand.
Engineering firms and financial stocks are among the big fallers: Engineering firms such as Melrose and BAE are among the big fallers:
Pakistan’s stock market has made a bad start to the new week, falling over 2% in early trading.Pakistan’s stock market has made a bad start to the new week, falling over 2% in early trading.
That follows a 4% tumble last week, as investors fretted about Pakistan’s economic outlook.That follows a 4% tumble last week, as investors fretted about Pakistan’s economic outlook.
Prime Minister Imran Khan is seeking an emergency bailout from the International Monetary Fund, who may demand tough austerity measures in return.Prime Minister Imran Khan is seeking an emergency bailout from the International Monetary Fund, who may demand tough austerity measures in return.
Pakistan's stock markets tumbles yet again - index down 2% in biggest decline in Asia today. Its dropped by such a level or more only 10 times this year pic.twitter.com/SQ9Im7PtU5Pakistan's stock markets tumbles yet again - index down 2% in biggest decline in Asia today. Its dropped by such a level or more only 10 times this year pic.twitter.com/SQ9Im7PtU5
Germany’s stock exchange has been hit by a technical glitch that has prevented trading getting underway.Germany’s stock exchange has been hit by a technical glitch that has prevented trading getting underway.
The Financial Times explains:The Financial Times explains:
The opening of trade in Deutsche Börse’s stock market, the primary trading venue for German equities, was delayed on Monday by “technical problems”.The opening of trade in Deutsche Börse’s stock market, the primary trading venue for German equities, was delayed on Monday by “technical problems”.
Deutsche Börse’s Xetrastock exchange, one of Europe’s biggest, faced issues with its “trading infrastructure” which meant the “trading start will not take place according to the usual trading schedule.”Deutsche Börse’s Xetrastock exchange, one of Europe’s biggest, faced issues with its “trading infrastructure” which meant the “trading start will not take place according to the usual trading schedule.”
So, we can’t see how the German DAX is faring yet....So, we can’t see how the German DAX is faring yet....
As feared, there’s no recovery in Europe’s stock market this morning.As feared, there’s no recovery in Europe’s stock market this morning.
The Stoxx 600 index, which tracks the largest European companies, has dropped by another 0.4% to a fresh 22-month low.The Stoxx 600 index, which tracks the largest European companies, has dropped by another 0.4% to a fresh 22-month low.
With traders reluctant to take risks, there’s a jittery feel in the trading floors again.With traders reluctant to take risks, there’s a jittery feel in the trading floors again.
Kit Juckes of Societe Generale says:Kit Juckes of Societe Generale says:
The Swiss franc and yen are stronger. Hard Brexit risks are mounting, global political risks are ever-present and equities and bond yields are lower ex-Italy.The Swiss franc and yen are stronger. Hard Brexit risks are mounting, global political risks are ever-present and equities and bond yields are lower ex-Italy.
The breakdown in Brexit talks, the disappearance of dissident Saudi journalist Jamal Khashoggi, the demise of the CSU in Bavarian elections, the impasse over Italy’s budget and the worried tone coming from the IMF/World Bank meetings in Bali all combine to give financial markets an uncomfortable feel this morning.The breakdown in Brexit talks, the disappearance of dissident Saudi journalist Jamal Khashoggi, the demise of the CSU in Bavarian elections, the impasse over Italy’s budget and the worried tone coming from the IMF/World Bank meetings in Bali all combine to give financial markets an uncomfortable feel this morning.
Shares in UK fashion group SuperDry have plunged by 20% after it shocked the City with a profits warning.Shares in UK fashion group SuperDry have plunged by 20% after it shocked the City with a profits warning.
SuperDry says that the “unseasonably hot weather conditions” in the UK, Continental Europe and on the East Coast of America has hit demand for its autumn ranges, and wipe £10m off profits.SuperDry says that the “unseasonably hot weather conditions” in the UK, Continental Europe and on the East Coast of America has hit demand for its autumn ranges, and wipe £10m off profits.
In another blow, the company is taking an £8m hit on foreign exchange costs, after discovering that its “hedging mechanisms” have not protected it from volatility in the currency markets.In another blow, the company is taking an £8m hit on foreign exchange costs, after discovering that its “hedging mechanisms” have not protected it from volatility in the currency markets.
Investors aren’t impressed - sending SuperDry shares sliding from £10.15 to just £8.12. At the start of the year they were worth £20.Investors aren’t impressed - sending SuperDry shares sliding from £10.15 to just £8.12. At the start of the year they were worth £20.
Profit warnings from Superdry blaming recent warm weather and currency. pic.twitter.com/AKY8yWaKGXProfit warnings from Superdry blaming recent warm weather and currency. pic.twitter.com/AKY8yWaKGX
Astonishingly, that’s not enough to make SuperDry the worst-performing stock today.Astonishingly, that’s not enough to make SuperDry the worst-performing stock today.
That ‘honour’ goes to medical equipment maker ConvaTec, whose shares have lurched 30% lower. The colostomy and wound bag manufacturer has slashed its profit forecasts, due to “challenging market dynamics”, and its CEO is retiring.That ‘honour’ goes to medical equipment maker ConvaTec, whose shares have lurched 30% lower. The colostomy and wound bag manufacturer has slashed its profit forecasts, due to “challenging market dynamics”, and its CEO is retiring.
Convatec shares slump by a quarter after FTSE 250 medical equipment maker issues latest profit warning alongside departure of Paul Moraviec, its chief executive. Shares trading at fresh lows of 167p, versus float price of 225p. pic.twitter.com/BmjBJlEL69Convatec shares slump by a quarter after FTSE 250 medical equipment maker issues latest profit warning alongside departure of Paul Moraviec, its chief executive. Shares trading at fresh lows of 167p, versus float price of 225p. pic.twitter.com/BmjBJlEL69
In London, the FTSE 100 index has opened 20 points higher (+0.3%), as traders try to put last week’s losses behind them.In London, the FTSE 100 index has opened 20 points higher (+0.3%), as traders try to put last week’s losses behind them.
Artjom Hatsaturjants at City firm Accendo Markets says the pound’s weakness is helping multinational companies:Artjom Hatsaturjants at City firm Accendo Markets says the pound’s weakness is helping multinational companies:
The muted open comes after a negative start to the week in Asia, where concerns over rising US interest rates continued weighing on equities.The muted open comes after a negative start to the week in Asia, where concerns over rising US interest rates continued weighing on equities.
Brexit negotiations suffered another setback over the weekend, as PM Theresa May rejected key EU proposals over the Irish border, dealing a blow to negotiations to avert a hard Brexit. This has sent the GBP [the pound] sharply lower ahead of an EU leaders summit on Wednesday, helping FTSE’s international names.Brexit negotiations suffered another setback over the weekend, as PM Theresa May rejected key EU proposals over the Irish border, dealing a blow to negotiations to avert a hard Brexit. This has sent the GBP [the pound] sharply lower ahead of an EU leaders summit on Wednesday, helping FTSE’s international names.
After another day of losses, China’s stock market has sunk to its lowest closing level in almost four years.After another day of losses, China’s stock market has sunk to its lowest closing level in almost four years.
CHINA’S SHANGHAI COMPOSITE INDEX CLOSES DOWN 1.49% TO 2568.1CHINA’S SHANGHAI COMPOSITE INDEX CLOSES DOWN 1.49% TO 2568.1
CHINA’S CSI 300 INDEX FALLS 1.4% TO 3,126.45 AT CLOSECHINA’S CSI 300 INDEX FALLS 1.4% TO 3,126.45 AT CLOSE
A cocktail of risks are weighing on the markets, says Jasper Lawler of London Capital Group:A cocktail of risks are weighing on the markets, says Jasper Lawler of London Capital Group:
Concerns over higher US borrowing costs were the catalyst for last week’s heavy sell off. However, there were plenty of other risk factors which were also dampening sentiment.Concerns over higher US borrowing costs were the catalyst for last week’s heavy sell off. However, there were plenty of other risk factors which were also dampening sentiment.
Those risk factors, including US- Sino trade tensions, Brexit, Italy’s Budget proposal and now increased political tensions between the US and Saudi Arabia, are set to keep pressure on risk appetite this week.Those risk factors, including US- Sino trade tensions, Brexit, Italy’s Budget proposal and now increased political tensions between the US and Saudi Arabia, are set to keep pressure on risk appetite this week.
Good morning from a wet and grisly London.Good morning from a wet and grisly London.
Last week wasn’t a pretty one for the City - the FTSE 100 fell steadily to a six-month low, while European stock sank to their lowest in 21 months.Last week wasn’t a pretty one for the City - the FTSE 100 fell steadily to a six-month low, while European stock sank to their lowest in 21 months.
And as the rain tips down, there’s little sign of optimism in the markets today.And as the rain tips down, there’s little sign of optimism in the markets today.
Germany traders have been rattled by yesterday’s Bavarian state parliament election, which saw the ruling Christian Social Union lose its majority. That’s another blow to Angela Merkel (whose CDU party are partners with the CSU)Germany traders have been rattled by yesterday’s Bavarian state parliament election, which saw the ruling Christian Social Union lose its majority. That’s another blow to Angela Merkel (whose CDU party are partners with the CSU)
There are tensions in Italy too, where the government is expected to approve its new budget, despite complaints from Brussels that it will breach EU fiscal rules.There are tensions in Italy too, where the government is expected to approve its new budget, despite complaints from Brussels that it will breach EU fiscal rules.
Yesterday, Italian prime minister Giuseppe Conte announced the budget would be “a change of gear for Italy”. Conte suggests Europe would soften its view, once Rome has explained its growth strategy to them....Yesterday, Italian prime minister Giuseppe Conte announced the budget would be “a change of gear for Italy”. Conte suggests Europe would soften its view, once Rome has explained its growth strategy to them....
But until that happens, investors will fear another episode in the eurozone debt crisis.But until that happens, investors will fear another episode in the eurozone debt crisis.
Spread-betting firm IG predicts fresh losses in Frankfurt and Milan today:Spread-betting firm IG predicts fresh losses in Frankfurt and Milan today:
European Opening Calls:#FTSE 6997 +0.02%#DAX 11496 -0.24%#CAC 5074 -0.44%#MIB 19098 -0.82%#IBEX 8832 -0.79%European Opening Calls:#FTSE 6997 +0.02%#DAX 11496 -0.24%#CAC 5074 -0.44%#MIB 19098 -0.82%#IBEX 8832 -0.79%
The losses continue to mount up on financial markets amid uncertainty across the world about trade, rising US interest rates and now a potential clash between the US and Saudi Arabia over the fate of missing journalist Jamal Khashoggi.The losses continue to mount up on financial markets amid uncertainty across the world about trade, rising US interest rates and now a potential clash between the US and Saudi Arabia over the fate of missing journalist Jamal Khashoggi.
The Saudi tension has sent the price of oil up and it’s also been a rough night for the pound ahead of this week’s crunch Brexit summit with sterling slipping. The yen meanwhile has strengthened a touch against the dollar.The Saudi tension has sent the price of oil up and it’s also been a rough night for the pound ahead of this week’s crunch Brexit summit with sterling slipping. The yen meanwhile has strengthened a touch against the dollar.
Stock markets fell in Asia overnight led by the Nikkei in Japan. It is off 1.85% (not helped by the rising yen). Seoul -0.7%, the Hang Seng -1.24% and Shanghai is off 0.83%.Stock markets fell in Asia overnight led by the Nikkei in Japan. It is off 1.85% (not helped by the rising yen). Seoul -0.7%, the Hang Seng -1.24% and Shanghai is off 0.83%.
The ASX200 in Sydney closed down 0.99%.The ASX200 in Sydney closed down 0.99%.
Futures trade suggests a flat start later today for the FTSE100 while the Dax30 in Germany is seen dropping 0.25%. Wall Street is tipped to fall too.Futures trade suggests a flat start later today for the FTSE100 while the Dax30 in Germany is seen dropping 0.25%. Wall Street is tipped to fall too.
The pound is down 0.3% to $1.31 and €1.135.The pound is down 0.3% to $1.31 and €1.135.
Brent crude is up 1.25% amid Saudi tensions.Brent crude is up 1.25% amid Saudi tensions.
JP Morgan and Ford bosses have joined the boycott of the Future Investment Intiative conference in Riyadh next week in the wake of the Khashoggi affair.JP Morgan and Ford bosses have joined the boycott of the Future Investment Intiative conference in Riyadh next week in the wake of the Khashoggi affair.
China says it faces “uncertainties” but has “plenty of room” for fiscal manoeuvre if thin gs get sticky. Which they nevertheless say they won’t.China says it faces “uncertainties” but has “plenty of room” for fiscal manoeuvre if thin gs get sticky. Which they nevertheless say they won’t.
The US dollar rose against the euro and other currencies. These included the Aussie dollar, a proxy for emerging market sentiment, which slipped to US71.06c from US71.26c on Friday.The US dollar rose against the euro and other currencies. These included the Aussie dollar, a proxy for emerging market sentiment, which slipped to US71.06c from US71.26c on Friday.
I’m signing off now. It’s been an interesting day but it’s time to hand over to Graeme Wearden in London. Thanks for joining us.I’m signing off now. It’s been an interesting day but it’s time to hand over to Graeme Wearden in London. Thanks for joining us.
It will be fascinating to see where the price of oil goes this week. Brent futures have risen 1.255 today to $81.5 a barrel and that could rise to $100 according to one analyst.It will be fascinating to see where the price of oil goes this week. Brent futures have risen 1.255 today to $81.5 a barrel and that could rise to $100 according to one analyst.
Kazuhiko Fuji, senior fellow at the Japanese government thinktank, the Research Institute of Economy, Trade and Industry, said:Kazuhiko Fuji, senior fellow at the Japanese government thinktank, the Research Institute of Economy, Trade and Industry, said:
Oil prices could rise to $100 on worries about Saudi Arabia. People had thought the Saudis will make up for fall in Iran’s output. If they are starting to use oil as their weapon, that will be a whole new chapter.Oil prices could rise to $100 on worries about Saudi Arabia. People had thought the Saudis will make up for fall in Iran’s output. If they are starting to use oil as their weapon, that will be a whole new chapter.
Apologies - I jumpped the gun on the Aussie market. The final settlemtn pushed it deeper into the red to end down 58.6 points, or 0.99%, at 5837.1 points.Apologies - I jumpped the gun on the Aussie market. The final settlemtn pushed it deeper into the red to end down 58.6 points, or 0.99%, at 5837.1 points.
Sears, the venerable US retailer, has gone into administration. It has filed for chapter 11 bankruptcy, according to a filing in a New York court, Reuters reports.Sears, the venerable US retailer, has gone into administration. It has filed for chapter 11 bankruptcy, according to a filing in a New York court, Reuters reports.
The filing says Sears, which once dominated US retailing in the golden age of catalogues, has assets in the range of $1bn to 10bn and liabilities in the range of $10bn to $50bn.The filing says Sears, which once dominated US retailing in the golden age of catalogues, has assets in the range of $1bn to 10bn and liabilities in the range of $10bn to $50bn.
The ASX200 is done for the day. It finishes down 46 points, or 0.79%, at 5,849 points.The ASX200 is done for the day. It finishes down 46 points, or 0.79%, at 5,849 points.
Saudi Arabia has threatened to retaliate against the world economy if western nations impose sanctions or similar if it emerges that the country’s security forces murdered the journalist Jamal Khashoggi.Saudi Arabia has threatened to retaliate against the world economy if western nations impose sanctions or similar if it emerges that the country’s security forces murdered the journalist Jamal Khashoggi.
But what form could Saudi action take? Our business reporter Rob Davies has been looking at the issues and his main points areBut what form could Saudi action take? Our business reporter Rob Davies has been looking at the issues and his main points are
The Saudis have the obvious power to push up oil prices. it’s the world’s biggest producer and reducing output would see prices rise, possibly causing a devastating oil shock to the world economy.The Saudis have the obvious power to push up oil prices. it’s the world’s biggest producer and reducing output would see prices rise, possibly causing a devastating oil shock to the world economy.
Second, the Saudis support thousands of US jobs through their extensive arms imports. Loss of those contracts would damage Donald Trump and he has already flagged that he doesnn’t want to jeopradise those deals for companies such as Boeing and Lockheed.Second, the Saudis support thousands of US jobs through their extensive arms imports. Loss of those contracts would damage Donald Trump and he has already flagged that he doesnn’t want to jeopradise those deals for companies such as Boeing and Lockheed.
Saudi funds are also important to planned US infrastructure development.Saudi funds are also important to planned US infrastructure development.
And it is a key strategic ally in the Middle EastAnd it is a key strategic ally in the Middle East
On the other side of the ledger, the Saudis are relying on western companies to reform the kingdom’s stagnant economy and diversify it away from oil. The growing boycott of next week’s Future Investment Initiative conference in Riyadh (now including JP Morgan and Ford) shows possible leverage. it will be a blow to Prince Mohammed’s prestige if more high-profile names pull out.On the other side of the ledger, the Saudis are relying on western companies to reform the kingdom’s stagnant economy and diversify it away from oil. The growing boycott of next week’s Future Investment Initiative conference in Riyadh (now including JP Morgan and Ford) shows possible leverage. it will be a blow to Prince Mohammed’s prestige if more high-profile names pull out.
You can read Rob’s full piece here:You can read Rob’s full piece here:
We seem to have hit a fairly quiet spot in the trading day.We seem to have hit a fairly quiet spot in the trading day.
The ASX200 in Sydney is down around 1% and is due to close in a few minutes.The ASX200 in Sydney is down around 1% and is due to close in a few minutes.
The Nikkei hasn’t moved from the -1.5% mark for a couple of hours. Ditto the Kospi (-0.5%) and the Hang Seng ( -0.1%). The CSI300 in Shanghai is probably the biggest mover, sliding from positive territory a couple of hours ago to now being off 0.8%.The Nikkei hasn’t moved from the -1.5% mark for a couple of hours. Ditto the Kospi (-0.5%) and the Hang Seng ( -0.1%). The CSI300 in Shanghai is probably the biggest mover, sliding from positive territory a couple of hours ago to now being off 0.8%.
Talking of China, it’s worth revisiting comments by the country’s central bank governor at the close of the IMF meeting in Bali on Sunday.Talking of China, it’s worth revisiting comments by the country’s central bank governor at the close of the IMF meeting in Bali on Sunday.
Yi Gang said China still had plenty of room for adjustment in interest rates and the reserve requirement ratio (RRR) in the face of any negative impact from trade tensions with the United States.Yi Gang said China still had plenty of room for adjustment in interest rates and the reserve requirement ratio (RRR) in the face of any negative impact from trade tensions with the United States.
He admitted China faced “tremendous uncertainties” but was seeking a “constructive solution” to the current trade tensions. “We still have plenty of monetary policy instruments in terms of interest rate policy, in terms of RRR. We have plenty of room for adjustment, just in case we need it,” Yi said, indicating that Beijing feels it has plenty of ammunition to fire up the economy if needed.He admitted China faced “tremendous uncertainties” but was seeking a “constructive solution” to the current trade tensions. “We still have plenty of monetary policy instruments in terms of interest rate policy, in terms of RRR. We have plenty of room for adjustment, just in case we need it,” Yi said, indicating that Beijing feels it has plenty of ammunition to fire up the economy if needed.
He added that he expected GDP to print at least 6.5% on Friday.He added that he expected GDP to print at least 6.5% on Friday.