Overnight Asian markets continued to climb with the Nikkei up +0.47% at 21,255 and the Hang Seng hitting an intraday +0.96% high. The Australian index rose close to a nine-year high. Some of the confidence sentiment was being supported by lower inflation readings from the US, bolstering the possibility of the brakes being applied to US Fed rate rises.
Higher oil prices too: at close to 7am Brent crude was +1% higher at $57.74 while WTI crude was up +0.76% at $51.84. Some of the oil uplift was premised on more US-Iran tension. The Iraq-Kurdistan conflict is also applying some oil pressure of its own with fresh fighting near Kirkuk, a major oil city which has declared independence by its Kurdish population.
At 7am the pound was trading at $1.3281, close to the $1.33 handle and supported by news of a UK dash to Brussels by PM Theresa May and Brexit Secretary David Davis in an attempt to break the Brexit deadlock. The euro was somewhat lower, down -0.09% at $1.1798 as Catalan premier Carles Puigdemont has to either reject independence or see Madrid muscle in with direct rule. The deadline is 10am this morning.
“We argue,” said Barclays in a research note issued this morning, “that de facto independence is highly unlikely in the near or medium-term in part because non-separatist parties control over 2/3 of the Spanish parliament; and we think their recent agreement to reform the constitution could help to de-escalate.” Either way, expect euro volatility.
- UK FTSE 100 7,535.44 -0.28%
- Dow 22,871.72 +0.13%
- S&P 500 2,553.17 +0.09%
- Nasdaq 6,605.80 +0.22%
- Nikkei 225 21,265.25 +0.88%
- DAX 12,991.87 +0.07%
- CAC 40 5,351.74 -0.17%
- Gold 1,304.90 +0.02%
- Oil WTI 51.84 +0.76%
ConvaTec snips full-year revenue forecast; Vauxhall jobs threat
Earlier this morning medical tech FTSE 100 player ConvaTec said it saw third quarter +6.8% growth to $445.5m but full year organic revenue growth is now expected to come in a +1-2% on lower sales. Advanced Wound Care revenue grew +1.4% reflecting some supply disruptions and loss of some orders.
There was also lower than anticipated revenue contribution from new products. “Given what we have experienced in the third quarter, we are reviewing the financial implications for growth and margins in FY2018,” said chief exec Paul Moraviec, “and will provide further guidance at our preliminary results in early 2018."
There’s more concern for Vauxhall and falling Astra sales. It’s thought 1,800 jobs could go as demand falls for some of models due to increasing SUV sales. Vauxhall is now owned by Peugeot and Citroën parent PSA which has complained of higher Ellesmere Port costs though PSA deny this is – so far – Brexit related.
UK now £500bn poorer?
New ONS figures suggest that the UK could be close to £500bn poorer than originally thought with a much lower safety net of foreign assets. The number-crunching is down to the UK’s net international investment position which has seen a surplus of almost £470bn shrink to a £22bn deficit according to the Telegraph.
“Half a trillion pounds has gone missing. This is equivalent to 25pc of GDP,” Mark Capleton, UK rates strategist at Bank of America, told the paper.
Breaking news: British retailer Footasylum says it hopes to list on AIM in November. "This is a logical next step in Footasylum’s upward trajectory as we seek to build on our exciting product-led, multi-channel expansion strategy," said the company in a statement this morning. The Federation of Master Builders warns that a hard Brexit Irish border will damage the construction industry.