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Hong Kong protests drag economy into recession – business live Hong Kong protests drag economy into recession – business live
(32 minutes later)
There’s relief for Northern Ireland today -- US aerospace manufacturer Spirit Aerosystems has bought the historic Short Brothers factory from Bombardier, saving thousands of jobs.
Bombardier's Belfast factory sold to Spirit in £850m deal
Ouch! The manufacturing sector in Chicago suffered a dramatic contraction this month.
The Purchasing Managers Index in the Chicago region has tumbled to 43.2 in October from 47.1 in September, a level that suggests output and activity crumbled.
Chicago PMI down to its lowest level since Dec. '15, and Dec. '08 before that. Yikes! pic.twitter.com/DvG9doEUmp
I guess this is partly due to the strike by General Motors staff this month, which ultimately won workers pay rises and protected their healthcare provision.
'Bosses take note': why GM's strike could inspire more collective action
Over in New York, stocks have dipped at the start of trading, despite Donald Trump’s attempts to bolster trade deal hopes.Over in New York, stocks have dipped at the start of trading, despite Donald Trump’s attempts to bolster trade deal hopes.
The Dow Jones industrial average has dropped by 62 points, or 0.2%, to 27,124.The Dow Jones industrial average has dropped by 62 points, or 0.2%, to 27,124.
The S&P 500 has dipped by 4 points, or 0.14%, to 3,042, away from last night’s record closing high, while the Nasdaq is flat.The S&P 500 has dipped by 4 points, or 0.14%, to 3,042, away from last night’s record closing high, while the Nasdaq is flat.
Facebook (+4%) and Apple (+1.6%) are rallying, though, after posting strong financial results last night.Facebook (+4%) and Apple (+1.6%) are rallying, though, after posting strong financial results last night.
#Breaking Facebook shares are up more than 4% as Q3 EPS were $2.12 vs $1.91 forecast .Average revenue per user: $7.26 vs $7.09 forecastPrices are indicative only. $NDX $SPX $ES_F $NQ $FB pic.twitter.com/UXvmZEALag#Breaking Facebook shares are up more than 4% as Q3 EPS were $2.12 vs $1.91 forecast .Average revenue per user: $7.26 vs $7.09 forecastPrices are indicative only. $NDX $SPX $ES_F $NQ $FB pic.twitter.com/UXvmZEALag
Newsflash: President Trump has just announced that he will sign a ‘phase one’ trade deal with President Xi soon.Newsflash: President Trump has just announced that he will sign a ‘phase one’ trade deal with President Xi soon.
China and the USA are working on selecting a new site for signing of Phase One of Trade Agreement, about 60% of total deal, after APEC in Chile was canceled do to unrelated circumstances. The new location will be announced soon. President Xi and President Trump will do signing!China and the USA are working on selecting a new site for signing of Phase One of Trade Agreement, about 60% of total deal, after APEC in Chile was canceled do to unrelated circumstances. The new location will be announced soon. President Xi and President Trump will do signing!
That follows Bloomberg’s claim that Beijing doesn’t believe it will sign a comprehensive agreement.That follows Bloomberg’s claim that Beijing doesn’t believe it will sign a comprehensive agreement.
More GDP data: Canada’s economy expanded by 0.1% in August, lifted by a pick-up in manufacturing.More GDP data: Canada’s economy expanded by 0.1% in August, lifted by a pick-up in manufacturing.
That follows no growth in July, but is weaker than the 0.2% rebound expected by economists.That follows no growth in July, but is weaker than the 0.2% rebound expected by economists.
Hong Kong has fallen into recession as its economy contracted for a second straight quarter after more than four months of protests. The once-common lines of shoppers from mainland China outside luxury stores are gone. https://t.co/BRaTe4dRJ8Hong Kong has fallen into recession as its economy contracted for a second straight quarter after more than four months of protests. The once-common lines of shoppers from mainland China outside luxury stores are gone. https://t.co/BRaTe4dRJ8
The protests in Hong Kong began against a bill that would have allowed Hong Kong citizens to be extradited to mainland China, or scores of other countries where there’s currently no extradition treaty.The protests in Hong Kong began against a bill that would have allowed Hong Kong citizens to be extradited to mainland China, or scores of other countries where there’s currently no extradition treaty.
Critics of the bill, which was abandoned last month, feared it could allow any citizen to be arrested and swept out of the City state to face charges.Critics of the bill, which was abandoned last month, feared it could allow any citizen to be arrested and swept out of the City state to face charges.
But as protestors in this video explained, the demonstrations became about other issues too - including police brutality, and attempts to undermine the “one country, two systems” formula created when Britain handed Hong Kong over in 1997.But as protestors in this video explained, the demonstrations became about other issues too - including police brutality, and attempts to undermine the “one country, two systems” formula created when Britain handed Hong Kong over in 1997.
Many of the protesters are young people, also angry about economic issues such as unaffordable property and income inequality.Many of the protesters are young people, also angry about economic issues such as unaffordable property and income inequality.
But some older people are on the streets too, trying to protect the younger generation. One, called Uncle Wong, told us his story here:But some older people are on the streets too, trying to protect the younger generation. One, called Uncle Wong, told us his story here:
Reuters is reporting that Hong Kong police have fired tear gas to try to break up anti-government protests in the densely populated district of Mong Kok on the Kowloon peninsula today.Reuters is reporting that Hong Kong police have fired tear gas to try to break up anti-government protests in the densely populated district of Mong Kok on the Kowloon peninsula today.
Demonstrations were expected on Hong Kong island to coincide with Halloween celebrations.Demonstrations were expected on Hong Kong island to coincide with Halloween celebrations.
Some protestors are wearing masks, to challenge an anti-mask ban brought in by the Hong Kong authorities earlier this month.Some protestors are wearing masks, to challenge an anti-mask ban brought in by the Hong Kong authorities earlier this month.
AP has more details:AP has more details:
Organizers are calling on supporters of the protest movement to take part in a “masquerade” that will put to the test a recent government ban on masks at public gatherings aimed at quelling the increasingly violent protests now in their fifth month.Organizers are calling on supporters of the protest movement to take part in a “masquerade” that will put to the test a recent government ban on masks at public gatherings aimed at quelling the increasingly violent protests now in their fifth month.
Digital fliers circulated online called on people to wear masks depicting Hong Kong Chief Executive Carrie Lam and Chinese President Xi Jinping and other senior officials.Digital fliers circulated online called on people to wear masks depicting Hong Kong Chief Executive Carrie Lam and Chinese President Xi Jinping and other senior officials.
They also said people could wear a mask and dress in red for the march, which was set to begin at a large park and proceed to the Lan Kwai Fong bar and nightclub district.They also said people could wear a mask and dress in red for the march, which was set to begin at a large park and proceed to the Lan Kwai Fong bar and nightclub district.
Just in: the protests in Hong Kong have helped to force make-up and fragrance firm Estee Lauder to cut its profit forecasts.Just in: the protests in Hong Kong have helped to force make-up and fragrance firm Estee Lauder to cut its profit forecasts.
Estee Lauder has told shareholders that net sales in Hong Kong fell in the last quarter.Estee Lauder has told shareholders that net sales in Hong Kong fell in the last quarter.
It blamed “events impacting key shopping areas” in recent months; namely, the widespread protests that forced shop closures and kept tourists away.It blamed “events impacting key shopping areas” in recent months; namely, the widespread protests that forced shop closures and kept tourists away.
This took the shine off an 11% increase in total net sales, to $3.9bn.This took the shine off an 11% increase in total net sales, to $3.9bn.
Estee Lauder also warns that it faces various social, economic and political risks, including “cContinued challenges in Hong Kong impacting key shopping areas”.Estee Lauder also warns that it faces various social, economic and political risks, including “cContinued challenges in Hong Kong impacting key shopping areas”.
It also cites Brexit, and the US-China trade wars, in a list of various “geopolitical tensions, regulatory matters, global security issues, currency volatility and economic challenges” that could hit consumer spending.It also cites Brexit, and the US-China trade wars, in a list of various “geopolitical tensions, regulatory matters, global security issues, currency volatility and economic challenges” that could hit consumer spending.
The company now expects 2020 adjusted profit between $5.85 and $5.93 per share compared with its prior range of $5.90 to $5.98.The company now expects 2020 adjusted profit between $5.85 and $5.93 per share compared with its prior range of $5.90 to $5.98.
Finally, some good news. Italy’s economy has returned to growth, with a 0.1% increase in GDP in the last quarter.Finally, some good news. Italy’s economy has returned to growth, with a 0.1% increase in GDP in the last quarter.
#Italy surprises positively! Grew 0.1% in Q3 vs 0% expected. pic.twitter.com/iV5suPPedt#Italy surprises positively! Grew 0.1% in Q3 vs 0% expected. pic.twitter.com/iV5suPPedt
Associated Press have written about the impact of Hong Kong’s recession on the tourism industry:Associated Press have written about the impact of Hong Kong’s recession on the tourism industry:
Kong’s main tourist strip, Ashfaqur Rahman’s tailor shop usually is a mainstay for tourists dropping in to peruse neatly stacked rolls of fabric and get measured for custom-made suits.Kong’s main tourist strip, Ashfaqur Rahman’s tailor shop usually is a mainstay for tourists dropping in to peruse neatly stacked rolls of fabric and get measured for custom-made suits.
Not anymore.Not anymore.
Business has dried up since anti-government protests began in early June in the Asian financial center.Business has dried up since anti-government protests began in early June in the Asian financial center.
On Thursday, the government said Hong Kong’s economy shrank 3.2% in July-September from the previous quarter, pushing the city into a technical recession.On Thursday, the government said Hong Kong’s economy shrank 3.2% in July-September from the previous quarter, pushing the city into a technical recession.
That makes two straight quarters of contraction since the economy contracted 0.5% in April-June on a quarterly basis.That makes two straight quarters of contraction since the economy contracted 0.5% in April-June on a quarterly basis.
The once-common lines of Chinese shoppers outside Hong Kong’s glittering luxury stores are gone. Jewelry stores have no customers and related businesses like transportation are languishing.The once-common lines of Chinese shoppers outside Hong Kong’s glittering luxury stores are gone. Jewelry stores have no customers and related businesses like transportation are languishing.
Rahman said his monthly sales have tumbled 80% from an average of 200,000 Hong Kong dollars ($25,500) in better times.Rahman said his monthly sales have tumbled 80% from an average of 200,000 Hong Kong dollars ($25,500) in better times.
His shop is tucked away in a passage off Nathan Road in the Tsim Sha Tsui district, which teems with posh hotels and upscale jewelry and fashion boutiques, set against the stunning backdrop of Victoria Harbor.His shop is tucked away in a passage off Nathan Road in the Tsim Sha Tsui district, which teems with posh hotels and upscale jewelry and fashion boutiques, set against the stunning backdrop of Victoria Harbor.
But on recent weekends the neighborhood has become a protest battle zone, with black-clad demonstrators clashing late into the night with riot police unleashing tear gas and water cannons.But on recent weekends the neighborhood has become a protest battle zone, with black-clad demonstrators clashing late into the night with riot police unleashing tear gas and water cannons.
“This is the worst we’ve seen,” said Rahman, a Bangladeshi immigrant who opened the shop 14 years ago. His sales now barely cover the rent and he and his business partner are dipping into their own pockets to pay the salaries of their five staff. He’s not sure they’ll be able to carry on if there’s no resolution to the increasingly violent protests.“This is the worst we’ve seen,” said Rahman, a Bangladeshi immigrant who opened the shop 14 years ago. His sales now barely cover the rent and he and his business partner are dipping into their own pockets to pay the salaries of their five staff. He’s not sure they’ll be able to carry on if there’s no resolution to the increasingly violent protests.
Tommy Wu, a Hong Kong-based economist with Oxford Economics, says:Tommy Wu, a Hong Kong-based economist with Oxford Economics, says:
“Much of the pressure is now coming from the political unrest.“Much of the pressure is now coming from the political unrest.
The trade war itself would cause Hong Kong’s GDP growth to slow but not a contraction, while the political unrest could.”The trade war itself would cause Hong Kong’s GDP growth to slow but not a contraction, while the political unrest could.”
Hong Kong’s economy looks to be in even worse shape than feared, says CNN.Hong Kong’s economy looks to be in even worse shape than feared, says CNN.
It blames months of protests that forced shops to close, paralyzed public transportation and scared off tourists, saying:It blames months of protests that forced shops to close, paralyzed public transportation and scared off tourists, saying:
Hong Kong plunged into recession in the third quarter, according to official data released Thursday. The economy shrank 3.2% during the three months to September, compared to the previous quarter.Hong Kong plunged into recession in the third quarter, according to official data released Thursday. The economy shrank 3.2% during the three months to September, compared to the previous quarter.
That’s a sharp slowdown from the 0.5% contraction recorded in the second quarter, and much worse than economists had expected.That’s a sharp slowdown from the 0.5% contraction recorded in the second quarter, and much worse than economists had expected.
With no immediate resolution to the city’s political crisis on the cards, Hong Kong’s first recession in a decade could extend into the new year.....With no immediate resolution to the city’s political crisis on the cards, Hong Kong’s first recession in a decade could extend into the new year.....
As a major trading hub, Hong Kong was already hurting from the US-China trade war and China’s slowing growth. Five months of mass demonstrations is now pushing the city toward an economic crisis.As a major trading hub, Hong Kong was already hurting from the US-China trade war and China’s slowing growth. Five months of mass demonstrations is now pushing the city toward an economic crisis.
More here: Hong Kong’s first recession in a decade could be even worse than fearedMore here: Hong Kong’s first recession in a decade could be even worse than feared
Newsflash: the eurozone grew by 0.2% in the third quarter of this year.Newsflash: the eurozone grew by 0.2% in the third quarter of this year.
That’s stronger than the 0.1% growth expected, but still a weak performance. It matches the 0.2% growth recorded in the April-June quarter.That’s stronger than the 0.1% growth expected, but still a weak performance. It matches the 0.2% growth recorded in the April-June quarter.
The wider European Union grew by 0.3% in July-September, according to statistics body Eurostat.The wider European Union grew by 0.3% in July-September, according to statistics body Eurostat.
That may be a sign that Britain’s economy returned to growth in the last quarter (we’ll find out next month, when UK GDP is released).That may be a sign that Britain’s economy returned to growth in the last quarter (we’ll find out next month, when UK GDP is released).
Euro area #GDP +0.2% in Q3 2019, +1.1% compared with Q3 2018: preliminary flash estimate from #Eurostat https://t.co/lTwvFXO1nb pic.twitter.com/3Q1S4I8eeMEuro area #GDP +0.2% in Q3 2019, +1.1% compared with Q3 2018: preliminary flash estimate from #Eurostat https://t.co/lTwvFXO1nb pic.twitter.com/3Q1S4I8eeM
Hong Kong fell into recession in Q3. GDP fell by 3.2%, lowering the annual growth rate to -2.9%, the worst since the financial crisis. pic.twitter.com/NKPWSkyz2KHong Kong fell into recession in Q3. GDP fell by 3.2%, lowering the annual growth rate to -2.9%, the worst since the financial crisis. pic.twitter.com/NKPWSkyz2K
Capital Economics has predicted that Hong Kong’s economy will continue to shrink in the current quarter, but probably at a slower rate.Capital Economics has predicted that Hong Kong’s economy will continue to shrink in the current quarter, but probably at a slower rate.
It told clients:It told clients:
“Any recovery will be constrained by weak business investment, however, as the city’s political crisis has done lasting damage to its reputation as a stable and autonomous financial hub.“Any recovery will be constrained by weak business investment, however, as the city’s political crisis has done lasting damage to its reputation as a stable and autonomous financial hub.
In another blow to Hong Kong - and the rest of the global economy - China apparently doesn’t believe it can agree a trade deal with Donald Trump.In another blow to Hong Kong - and the rest of the global economy - China apparently doesn’t believe it can agree a trade deal with Donald Trump.
Bloomberg has the story:Bloomberg has the story:
Chinese officials are casting doubts about reaching a comprehensive long-term trade deal with the U.S. even as the two sides get close to signing a “phase one” agreement, Bloomberg News reported.Chinese officials are casting doubts about reaching a comprehensive long-term trade deal with the U.S. even as the two sides get close to signing a “phase one” agreement, Bloomberg News reported.
In private conversations with visitors to Beijing and other interlocutors in recent weeks, Chinese officials have warned they won’t budge on the thorniest issues, according to people familiar with the matter. They remain concerned about President Donald Trump’s impulsive nature and the risk he may back out of even the limited deal both sides say they want to sign in the coming weeks.In private conversations with visitors to Beijing and other interlocutors in recent weeks, Chinese officials have warned they won’t budge on the thorniest issues, according to people familiar with the matter. They remain concerned about President Donald Trump’s impulsive nature and the risk he may back out of even the limited deal both sides say they want to sign in the coming weeks.
This has worried investors, sending stocks down across the globe. A protracted trade war is bad news for growth, at a time when most advanced economies are slowing.This has worried investors, sending stocks down across the globe. A protracted trade war is bad news for growth, at a time when most advanced economies are slowing.
In London, the FTSE 100 has lost 0.8%, or 60 points, dragged down by mining stocks and Royal Dutch Shell (following its slump in profits this morning).In London, the FTSE 100 has lost 0.8%, or 60 points, dragged down by mining stocks and Royal Dutch Shell (following its slump in profits this morning).
spot where the China trade news crossed pic.twitter.com/ssoQ9UGwoJspot where the China trade news crossed pic.twitter.com/ssoQ9UGwoJ
Hong Kong’s economy has also been hurt by the ongoing trade war between the US and China.Hong Kong’s economy has also been hurt by the ongoing trade war between the US and China.
Here’s the AFP newswire’s take:Here’s the AFP newswire’s take:
Hong Kong on Thursday confirmed it had plunged into its first recession since the global financial crisis as months of seething pro-democracy protests and the US-China trade war exact a heavy toll on the financial hub.Hong Kong on Thursday confirmed it had plunged into its first recession since the global financial crisis as months of seething pro-democracy protests and the US-China trade war exact a heavy toll on the financial hub.
The semi-autonomous Chinese city has been upended by nearly five months of huge, often violent, pro-democracy demonstrations with little end in sight as Beijing and city leaders adopt a hardline approach.The semi-autonomous Chinese city has been upended by nearly five months of huge, often violent, pro-democracy demonstrations with little end in sight as Beijing and city leaders adopt a hardline approach.
Clashes between protesters hurling bricks and petrol bombs at police wielding tear gas and rubber bullets have become a weekly occurrence, hammering the city’s once-solid reputation for stability and safety.Clashes between protesters hurling bricks and petrol bombs at police wielding tear gas and rubber bullets have become a weekly occurrence, hammering the city’s once-solid reputation for stability and safety.
The unrest has hit the city’s tourist and entertainment industries hard, compounding economic woes that were already being caused by the global trade war.The unrest has hit the city’s tourist and entertainment industries hard, compounding economic woes that were already being caused by the global trade war.
Figures released by the government on Thursday showed gross domestic product plunged 3.2% in the third quarter compared with the previous period, when it saw a 0.4% drop.Figures released by the government on Thursday showed gross domestic product plunged 3.2% in the third quarter compared with the previous period, when it saw a 0.4% drop.
That means the city is experiencing a technical recession, with two back-to-back periods of contraction.That means the city is experiencing a technical recession, with two back-to-back periods of contraction.
It is the first time the city has witnessed a recession since early 2009 at the height of the financial crisis.It is the first time the city has witnessed a recession since early 2009 at the height of the financial crisis.
Hong Kong’s economy was already facing strong headwinds at the start of 2019 as it was hit by the US-China trade war, battering a city that is hugely reliant on the world’s two largest economies.Hong Kong’s economy was already facing strong headwinds at the start of 2019 as it was hit by the US-China trade war, battering a city that is hugely reliant on the world’s two largest economies.
Hong Kong has slid into a recession for the first time since the global financial crisis in the third quarter, advance estimates show. It's largely due to on-going anti-government protests, and the protracted U.S.-China trade war. #HongKong #recessionHong Kong has slid into a recession for the first time since the global financial crisis in the third quarter, advance estimates show. It's largely due to on-going anti-government protests, and the protracted U.S.-China trade war. #HongKong #recession
The Financial Times points out that several economists predict the recession could intensify in the next few quarters:The Financial Times points out that several economists predict the recession could intensify in the next few quarters:
Iris Pang, an economist at ING, an investment bank, forecast that the economy would shrink in all four quarters next year.Iris Pang, an economist at ING, an investment bank, forecast that the economy would shrink in all four quarters next year.