New data from the Centre for Economics and Business Research (CEBR) does not flatter the UK economy: the BDO output index has slumped to a four-year low of 94.9 points – which means a confidence contraction.
This particular index is significant because of its close relationship with the services industry, responsible for close to 80% of the UK economy. However the pound was up 0.09% overnight at $1.2900, helped by a slightly weakened yen, while the euro was 0.03% higher at $1.1405.
Looking ahead, some focus on US interest rates. The US Federal Reserve policy will get an airing at a Congressional hearing midweek. That may give the markets more clarity on the longer term direction, but also add to the volatility pressure.
This morning German current account trade data is out – exports are likely to continue to show progress – with consumer credit data from the US emerging late tonight at 10pm.
- UK FTSE 100, 7,350.92 +0.19%
- Dow 21,414.34 +0.44%
- S&P 500 2,425.18 +0.64%
- Nasdaq 6,153.08 +1.04%
- Nikkei 225 20,080.32 +0.76%
- DAX 12,388.68 +0.06%
- CAC 40 5,145.16 -0.14%
- Gold 1,210.70 +0.08%
- Oil WTI 44.62 +0.88%
Carillion boss Howson quits
We start with a resignation from roads-to-railways construction player Carillion. Chief exec, Richard Howson, is to quit. The construction operator has warned sales are under threat and that the dividend is suspended. Cashflow delays on several projects are blamed “reflecting difficult markets and exits from certain territories”.
Half-year revenues are predicted to land at £2.5bn, though operating profits will be lower. Borrowing costs will also be higher: average net borrowing for the first half will be approximately £695m against £586.5m for last year. The dividend close-down is expected to save Carillion £80m.