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You can find the current article at its original source at https://www.theguardian.com/business/live/2019/dec/04/trade-war-trump-china-deal-markets-uk-services-sector-economy-business-live
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M&G suspends property fund amid Brexit uncertainty and retail crisis - business live | |
(32 minutes later) | |
Rolling coverage of the latest economic and financial news | Rolling coverage of the latest economic and financial news |
NEWSFLASH: One of Britain’s biggest fund managers has just suspended dealing in its multi-billion property fund. | |
M&G has blamed Brexit for the temporary move, saying political uncertainty has made it hard to sell property assets to meet redemption requests from investors in its Property Portfolio. | |
The crisis on the high street -- with many retailers shutting stores -- is another factor. | |
In a letter to investors, M&G says: | |
What does it mean? | |
The Property Portfolio holds 91 commercial properties across the UK, and manages assets of £2.54 billion. | |
Funds of its type take money from investors, invest it in commercial property assets, and pay returns from rental payments and capital appreciation. | |
As M&G points out, those properties are hard to sell quickly (unless you accept a firesale price). So if too many investors want to withdraw their money at the same time, the fund can struggle to meet those redemptions. | |
Back on trade.... Donald Trump has told reporters in London that talks with China are going “very well”. | |
During a press event with German chancellor Angela Merkel, Trump said: | |
That’s a more upbeat assessment than yesterday, when the president hinted that he might not sign off a deal for another year. | |
This is likely to reassure markets; a cynic might question whether Trump is keen to reverse yesterday’s selloff with some good publicity. | |
But the BIG headlines are on Trump calling Justin Trudeau “two-faced” after video emerged showing Canada’s PM laughing about Trump with Boris Johnson, Emmanuel Macron,Mark Rutte and Princess Anne. | |
Boom! Sterling has now hit its highest level against the euro since May 2017. | Boom! Sterling has now hit its highest level against the euro since May 2017. |
General election speculation has driven the pound up to €1.182 against the single currency, a 31-month high. | General election speculation has driven the pound up to €1.182 against the single currency, a 31-month high. |
Traders are increasingly betting on a Conservative victory next week. The pound is also benefitting from the fact that this morning’s service sector data was less bad than feared (but really not good!). | Traders are increasingly betting on a Conservative victory next week. The pound is also benefitting from the fact that this morning’s service sector data was less bad than feared (but really not good!). |
We should remember, though, that one pound was worth €1.30 before the Brexit referendum.... | We should remember, though, that one pound was worth €1.30 before the Brexit referendum.... |
Ian Strafford-Taylor, CEO of currency and payments firm Equals, suggests the pound is still vulnerable to political drama: | Ian Strafford-Taylor, CEO of currency and payments firm Equals, suggests the pound is still vulnerable to political drama: |
Newsflash: Rather fewer jobs were created at American companies last month than expected, a new report shows. | Newsflash: Rather fewer jobs were created at American companies last month than expected, a new report shows. |
The ADP payroll, which measures US employment, has risen by 67,000 in November, much weaker than the 140,000 which Wall Street expected. | The ADP payroll, which measures US employment, has risen by 67,000 in November, much weaker than the 140,000 which Wall Street expected. |
October’s payroll has been revised lower too, to 121,000 from 125,000. | October’s payroll has been revised lower too, to 121,000 from 125,000. |
This might be a sign that the US economy is losing momentum; we’ll get a better picture on Friday, when the broader Non-Farm Payroll survey of US labor is released. | This might be a sign that the US economy is losing momentum; we’ll get a better picture on Friday, when the broader Non-Farm Payroll survey of US labor is released. |
Sterling is continuing to climb, and is now up a whole cent today at $1.309. | Sterling is continuing to climb, and is now up a whole cent today at $1.309. |
That’s a new seven-month high against the US dollar, the strongest position since May 7th. | That’s a new seven-month high against the US dollar, the strongest position since May 7th. |
Aviation News: Budget airline Ryanair is planning to close two bases, due to the ongoing delays to Boeing’s 737 MAX jet. | Aviation News: Budget airline Ryanair is planning to close two bases, due to the ongoing delays to Boeing’s 737 MAX jet. |
Ryanair says it now expects to only receive 10 737 MAX aircraft in time for next summer, not the 20 previously expected. That means it will carry a million fewer passengers -- 156m, not 157m -- and force it to shutter operations at Nuremberg and Stockholm Skavsta. | Ryanair says it now expects to only receive 10 737 MAX aircraft in time for next summer, not the 20 previously expected. That means it will carry a million fewer passengers -- 156m, not 157m -- and force it to shutter operations at Nuremberg and Stockholm Skavsta. |
Boeing is still trying to get the 737 Max recertified, following the two fatal crashes blamed on a flawed anti-stall mechanism. | Boeing is still trying to get the 737 Max recertified, following the two fatal crashes blamed on a flawed anti-stall mechanism. |
John Goldie, FX Dealer at Argentex Group, predicts the pound could rise to at least $1.33 if Johnson wins a majority next week. | John Goldie, FX Dealer at Argentex Group, predicts the pound could rise to at least $1.33 if Johnson wins a majority next week. |
But victory isn’t assured, so sterling could yet slide back to $1.25, Goldie suggests. | But victory isn’t assured, so sterling could yet slide back to $1.25, Goldie suggests. |
Here’s a clip of Rosenthal picking out the crossbar when it was rather easier to score.... | Here’s a clip of Rosenthal picking out the crossbar when it was rather easier to score.... |
Pollsters, such as YouGov, have been giving the Conservatives a solid lead in the polls for months. | Pollsters, such as YouGov, have been giving the Conservatives a solid lead in the polls for months. |
But Boris Johnson has suggested that the race is ‘very tight’. That could just be a message designed to get the vote out next Thursday... | But Boris Johnson has suggested that the race is ‘very tight’. That could just be a message designed to get the vote out next Thursday... |
...or it could reflect memories of 2017, when Theresa May lost her majority despite beginning her election campaign with a big lead. | ...or it could reflect memories of 2017, when Theresa May lost her majority despite beginning her election campaign with a big lead. |
Wall Street is expected to recover yesterday’s slump too, thanks to Bloomberg’s report that a US-China trade deal could still happen soon. | Wall Street is expected to recover yesterday’s slump too, thanks to Bloomberg’s report that a US-China trade deal could still happen soon. |
Sterling is also climbing against the euro, hitting a near-nine month high of €1.1786. | Sterling is also climbing against the euro, hitting a near-nine month high of €1.1786. |
That’s because Boris Johnson appears to be on track for victory in next week’s election, says Dean Turner, economist at UBS Wealth Management. | That’s because Boris Johnson appears to be on track for victory in next week’s election, says Dean Turner, economist at UBS Wealth Management. |
But with a week’s campaigning to go, nothing is certain. Turner writes: | But with a week’s campaigning to go, nothing is certain. Turner writes: |
The pound has hit its highest level in seven months, as City traders show increased confidence that Boris Johnson will win next week’s general election. | The pound has hit its highest level in seven months, as City traders show increased confidence that Boris Johnson will win next week’s general election. |
Sterling has jumped to $1.3039, up nearly half a cent, to levels not seen since May 2019. | Sterling has jumped to $1.3039, up nearly half a cent, to levels not seen since May 2019. |
Traders appear to be reacting to the latest Sky News/YouGov poll, which gave the Conservatives a nine-point lead ahead of Thursday’s general election. | Traders appear to be reacting to the latest Sky News/YouGov poll, which gave the Conservatives a nine-point lead ahead of Thursday’s general election. |
The poll puts the Tories on 42%, Labour on 33%, the Liberal Democrats are on 12%, and Brexit Party is on 4%, up two points. | The poll puts the Tories on 42%, Labour on 33%, the Liberal Democrats are on 12%, and Brexit Party is on 4%, up two points. |
The City fears another hung parliament, which could mean more deadlock and possible a disorderly Brexit. So this polling is pushing the pound up. | The City fears another hung parliament, which could mean more deadlock and possible a disorderly Brexit. So this polling is pushing the pound up. |
Rupert Thompson, Head of Research at Kingswood, says investor confidence in a Conservative victory has grown. | Rupert Thompson, Head of Research at Kingswood, says investor confidence in a Conservative victory has grown. |
But even at todays levels, the pound is still some 13% weaker than before the Brexit vote three years ago. | But even at todays levels, the pound is still some 13% weaker than before the Brexit vote three years ago. |
Thompson explains: | Thompson explains: |
In a surprise twist, European stock markets are all rallying.... as hopes of a US-China trade deal grow again. | In a surprise twist, European stock markets are all rallying.... as hopes of a US-China trade deal grow again. |
Every index is up, with France, Italy andGermany rallying by over 1%, after unnamed sources claimed that Donald Trump had painted a too-gloomy picture of negotiations yesterday. | Every index is up, with France, Italy andGermany rallying by over 1%, after unnamed sources claimed that Donald Trump had painted a too-gloomy picture of negotiations yesterday. |
According to these insiders, a deal could still be reached this month. | According to these insiders, a deal could still be reached this month. |
Bloomberg has the details: | Bloomberg has the details: |
Andy Bruce of Reuters shows how UK service sector growth has fizzled out this year: | Andy Bruce of Reuters shows how UK service sector growth has fizzled out this year: |
If today’s PMIs are accurate, they suggest the UK could be sliding back to the brink of recession. | If today’s PMIs are accurate, they suggest the UK could be sliding back to the brink of recession. |
Howard Archer of EY Item Club is revising down his hopes for growth in the fourth quarter of 2019, having seen November’s gloomy PMIs. | Howard Archer of EY Item Club is revising down his hopes for growth in the fourth quarter of 2019, having seen November’s gloomy PMIs. |
Duncan Brock, Group Director at the Chartered Institute of Procurement & Supply, blames Brexit for the drop in UK service sector activity last month. | Duncan Brock, Group Director at the Chartered Institute of Procurement & Supply, blames Brexit for the drop in UK service sector activity last month. |
Here’s his take on November’s PMIs: | Here’s his take on November’s PMIs: |
Tim Moore, economics associate director at IHS Markit, says the UK economy is “staggering” through the final quarter of the year, with output falling at services companies and factories. | Tim Moore, economics associate director at IHS Markit, says the UK economy is “staggering” through the final quarter of the year, with output falling at services companies and factories. |