PM update: UK trade talks boosted, dollar up, GE tumbles

PM Theresa May was boosted earlier when UK-EU trade talks were signalled for December (though plenty of inevitable wobbles before then) by European President Donald Tusk (pictured). The impact on sterling was immediate: by close to 4pm the pound was up almost +0.80% against the euro at 1.1187 while the pound was +0.29% higher against the greenback at 1.3189.

On the surface, the EU trade discussion news is positive for sterling. Yet there’s still ambiguity over a UK interest rate rise and British wages and inflation remain well out of whack (too low & too high, respectively). It’s also thought the British prime minister will not – currently – raise a €20bn divorce offer to EU leaders. Uncertainty still stalks for a pound recovery.  

However, better news for the Government earlier when the Office of National Statistics confirmed the UK’s September deficit came in at £5.902bn. That’s an -11% drop on August. Public spending isn’t down overall (despite claims from the Conservatives) but tax receipts are higher. Yet in the shadows lies the P-word, Productivity. It’s going nowhere for the UK, still. 

In the US stocks continued to pump higher with the Dow up +0.33% boosted by President Trump’s tax program breakthrough. Actually progress will be fraught – warning – with technical difficulties. At the end of trading the FTSE 100 was +0.19% up at 7,523 with Standard Chartered up +3.13% while Fresnillo and Unilever were down by -3.6% and -3.2% respectively.

• UK FTSE 100 7,523.23 +0.19%
• Dow 23,237.86 +0.32%
• S&P 500 2,570.02 +0.31%
• Nasdaq 6,629.46 +0.37%
• Nikkei 225 21,457.64 +0.04%
• DAX 12,999.44 +0.07%
• CAC 40 5,378.71 +0.19%
• Gold 1,284.20 -0.45%
• Oil WTI 51.48 +0.37%

General Electric shares down on Q3 earnings; more worry for Kobe Steel

In the US despite the upbeat corporate earnings mood General Electric has snipped profits guidance following a -5% third quarter earnings slump from its key oil and gas and power businesses. Higher input costs are also blamed. 

Full year operating profits will likely land at $1.05-$1.10 a share. That’s in comparison to a July GE claim of $1.60-$1.70 a share – some fall. There was better news on the online digital side for GE (where it has invested heavily), up +50%. General Electric shares slid -2.5% on the news today. 

Japanese steel player Kobe Steel says it has uncovered new instances of fake data on its products. It’s thought the concern relates to the thickness of steel sold. Currently up to 500 clients have been affected by the data integrity breaches – and the time span could be as much as a decade. 

GE share slump on profits worry: Shutterstock

Macron still downbeat on EU-UK deal

French President Macron meanwhile remains cautious on UK-EU exit discussions. “We are a long way off on the financial commitments," he said earlier. His comments contrast with those of Donald Tusk suggesting discussions for a trade deal could start well before Christmas. 

"It is clear that this would not be possible without the new momentum given by the Florence speech of Prime Minister May," Tusk has said. Either way, fears for a ‘hard Brexit’ fell modestly today.

Breaking news: Facebook, Twitter and Google have said they will remove extremist posts within two hours of content being posted. Izham Ismail is the new group chief executive designate for Malaysia Airlines. He replaces Peter Bellew who is returning to Ryanair. Bloomberg claims Newcastle United FC was up for sale in July with an asking price of £400m.