US central bank chief Janet Yellen gave little away in her closely scrutinised Jackson Hole address earlier. Bereft of grip on future monetary policy moves, the dollar slipped allowing the euro and the pound substantial gains. At 4pm sterling and the euro were both up +0.60%, valued at $1.2875 and $1.1870.
Sterling’s rise inevitably hit the export-heavy FTSE 100, closing slightly down at 7,401 points after earlier positivity, as well as share gains across Europe. The biggest riser (again) was Provident Financial, up +22% to 916p. However shares in Paddy Power Betfair and CRH fell -2% and -2.61%.
Anxiety about US Hurricane Harvey – it’s expected to land near Houston tonight – saw oil prices clip higher with WTI crude up +0.51% to $47.67 and Brent Crude up +0.42% to $52.26. Several oil refineries have shut down in anticipation of rising water levels and disruption.
- UK FTSE 100 7,401 -0.08%
- Dow 21,874.94 +0.41%
- S&P 500 2,450.62 +0.48%
- Nasdaq 6,296.21 +0.60%
- Nikkei 225 19,452.61 +0.51%
- DAX 12,228.65 +0.38%
- CAC 40 5,128.27 +0.29%
- Gold 1,294.70 +0.22%
- Oil WTI 47.83 +0.78%
Amazon discount-slashing anxiety hits UK supermarkets
Fear of Amazon discounting at newly acquired Whole Foods saw some share price stress from the Big Four grocers. Tesco shares were trading close to -2% lower at 4.25pm this afternoon though J Sainsbury’s looked more resilient, down -0.30%. Amazon discounting at Whole Foods stores is imminent despite some regulatory deal hurdles still to cross.
Prices are set to be cut on staples including eggs, fruit and meat. However Morrisons already has a relationship with Amazon Prime meaning a two-hour delivery promise in certain parts of the UK.
The British Chambers of Commerce (BCC) claims 80% of UK businesses have seen their costs surge because of new pension and employment legislation. The BCC's new annual workforce survey claims 38% of businesses will now hike costs to compensate.
“There comes a point at which rising employment costs can no longer be absorbed through reduced profits,” said Janet Gratton, head of Business Environment and Skills at the BCC.
Resist Trump reforms – Yellen warns
Analysis is still coming in from Janet Yellen’s Fed speech. One key theme is Yellen’s clear distaste for any more de-regulation of the US financial framework. President Trump is keen to abolish the 2010 Dodd-Frank Act, a chunky piece of the post-2008 financial crisis legislation, to bolster the US economy.
“Any adjustments to the regulatory framework should be modest and preserve the increase in resilience at large dealers and banks associated with the reforms put in place in recent years,” Janet Yellen said earlier. The message couldn't be clearer.
Breaking news: Aston Martin has recorded more than £21m in pre-tax profits for the six months to 30 June. Second quarter revenues were worth £222m drawing profits of £15.2m.