The number one business story this morning is the collapse of Monarch Airlines. Monarch follows Air Berlin and Alitalia into bankruptcy. Monarch, who employs 3,000, was the UK’s fifth biggest airline with 300,000 booked to fly in the near future. More below.
Overnight the euro was down -0.36% to $1.1766 against the dollar with the Catalan independence referendum turmoil driving much of the euro uncertainty, dragging the euro under the $1.18 handle. Meanwhile the pound fell again, down -0.22% to $1.3360, making a -0.76% weekly fall in total. The Conservative Party Conference kicks off today in earnest; expect higher volatility than usual on the sterling front.
But equities were broadly positive in Asia today with the Kim Jong Un Factor dipping out of view, at least for the moment. The Australian S&P/ASX 200 rose +1% thanks to a weaker Australian dollar, bolstering exporters. While the Nikkei 225 pulled up just +0.16% overnight, business confidence from Japan’s biggest manufacturers appears close to a 10-year high, a new central bank survey claimed today.
A spread of EU job numbers are out at 10am while construction spending and ISM manufacturing data emerges from the US at 3pm.
- UK FTSE 100 7,372.76 +0.68%
- Dow 22,405.09 +0.11%
- S&P 500 2,519.36 +0.37%
- Nasdaq 6,495.96 +0.66%
- Nikkei 225 20,389.51 +0.16%
- DAX 12,600.03 +0.25%
- CAC 40 5,267.29 +0.49%
- Gold 1,276.70 -0.63%
- Oil WTI 50.69 -0.02%
Monarch's demise could be Ryanair's gain
More on Monarch. Last year Monarch’s owner, Greybull Capital, injected £165m into the struggling airline allowing it to order 30 new Boeing 737 jets. Monarch was under pressure from reduced demand from North African destinations and was increasingly being squeezed by Ryanair and easyJet, despite lower oil prices.
Withdrawing from long haul at a time when Norwegian was actively ramping up long haul to the US was possibly also a mistake. Monarch's demise though will be good for Ryanair and easyJet – particularly Ryanair as it struggles to attract more pilots. Meanwhile the Civil Aviation Authority has advised anyone booked to fly Monarch to abandon any trip to the airport.