Stocks mixed in NY before G20 Osaka

The US equities closed mixed today in New York ahead of the G20 meeting in Osaka, Japan on Saturday. The US President said he would use the “Plan B” if the US and China cannot proceed with the trade issues during the weekend. He said the new tariffs would be closer to 10 % rather than 25 %.

Dow Jones closed down 0,04 % to 26 536 points, S&P 500 index closed down 0,12 % to 2913 points, but Nasdaq ended up 0,32 % to 7909 points.

In the tech-stocks the ride-hailing company Uber (UBER) ended down 1,37 % to 42,45 dollars, showing the market capital of 72 billion dollars. The rival Lyft (LYFT) ended also down 1,67 % to 62,82 dollars with the market cap of 18,3 billion dollars. The latest IPO tech company, Slack Technologies rose 4,96 % to 32,37 dollars (16,4 billion market cap). Cryptocurrency Bitcoin reached above 13 000 dollars.

One of the hottest issues during the G20 leaders summit will be foreign exchange rates. Mr Trump has said that the US dollar is too strong compared to euro and Chinese yuan and thus taking competitive edge from the US companies. The G20 finance ministers and central bankers have already made their commitments from competitive devaluation, according to Bloomberg. In the markets, the Federal Reserve rate cut is expected to happen in July meeting.

The important meeting with President Donald Trump and the Chinese President Xi Jinping will be on Saturday. Mr Trump will also meeting for example the Russia´s President Vladimir Putin and Turkey´s Erdogan.

In Europe the stocks wee also mixed. In London the FTSE 100 index ended down 0,08 % to 7416 points, while in Germany the DAX index ended up 0,14 % to 12 245 points. In France the stocks declined by 0,25 % to 5500 points. The German 10 year government bond yield dropped to record low to -0,31 %.

The debate about Brexit continued and Boris Johnson, the PM and Conservative leader candidate, said that he does not expect no-deal departure on October.

The sterling was trading down 0,03 % to 1,2685 dollars, while euro was trading down 0,01 % to 1,1366 dollars. Dollar was up 0,54 % to 107,78 Japanese yen.

In Asia the stocks were also mixed. In Shanghai the stocks closed down 0,19 % to 3117 points, while in Hong Kong the Hang Seng index closed up 0,13 % to 28 221 points. In Japan the Nikkei 225 index ended down 0,51 % to 21086 points.

Business Finance

Stocks closed down in NY- US data and trade tariffs

The US equities closed down today due to weak consumer confidence data and the trade tariffs between the US and China. The US and China leaders are meeting this week in G20 meeting in Japan and the information from the Federal Reserve has been that the tariffs can increase the risk of slower growth globally if there is no more confidence in the markets.

Dow Jones closed down 0,67 % to 26 549 points, S&P 500 index down 0,95 % to 2917 points and Nasdaq down 1,51 % to 7884 points. In Europe the FTSE 100 -index closed up 0,08 % to 7422 points, while the equities on the continent were down. In Germany the DAX closed down 0,38 % to 12 228 points and in France the CAC 40 down 0,13 points to 5514 points.

The US consumer confidence and new home sales were both below markets expectations. On the other hand on the M&A side, the deal volumes and values have been record high, according to Bloomberg data. On Tuesday, AbbVie said it would buy Allergan company, the Botox maker, for 63 billion dollars.

The G20 meeting on Friday and Saturday in Osaka, Japan will give more information while the US President Donald Trump and the Chinese President Xi Jinping will have their discussions then. According to Bloomberg, the US officials have signalled that the trade deal is unlikely to happen.

The US markets have been pricing a 50 basis points rate cut for the next Federal Reserve meeting in July, but according to St.Lous Fed President James Bullard such a rate cut would be too much. He commented the situation in a Bloomberg interview.

The central bankers have been discussing about the cryptocurrencies and Facebook´s new Libra coin in the central banks meeting in Switzerland today. The question of financial stability, consumer and regulatory standpoint are the major issues for the tech company and some believe Libra is not going to be a Bitcoin.

According to Reuters, the Facebook other issues related to privacy concerns and hate speeches have been the major topics and central bankers are requiring more information from Facebook in order to proceed with the new currency. The Britain’s Financial Conduct Authority (FCA) also commented the issue today with the same tone of voice.

In London, the discussions about the Brexit deal and the new Prime Minister have continued. Boris Johnson or Jeremy Hunt will be the next Prime Minister for the UK and the new leader will be announced on the 23rd of July. The deadline, October 31st will be soon, while the UK Parliament is starting their summer holidays on July 25 and the MPs will return on the September 3rd.

The euro was trading slightly up 0,01 % to 1,1368 dollars and the sterling up 0,06 % to 1,2696 dollars.

In Asia, the stocks were also down, the Shanghai All ended down 0,87 % to 2982 points, the Hang Seng in Hong Kong down 1,15 % to 28185 points and the Nikkei-index in Japan down 0,43 % to 21 193 points.

 

 

 

 

 

 

Business Finance

Stocks down in NY due to new trade tariffs

The US stock markets closed down today due to the US China trade dispute. Mr President Donald Trump said in the CNBC interview that he is preparing to have new tariffs for 300 billion dollars for goods if the Chinese President Xi Jinping is not meeting in the G20 meeting in Osaka, Japan in late June. This would mean that Chinese goods would get new tariffs to the current 250 billion dollars of goods.

Dow Jones index closed down 0,05 % to 26048,51 points, the S&P 500 index closed down 0,03 % to 2885,72 points and Nasdaq ended down 0,01% to 7822,56 points.

In the forex markets, the euro was trading up 0,02 % to 1,13 dollars, while the sterling was down 0,05 % 1,2719 dollars. President Donald Trump´s comments about the interest rates and the Fed´s too tight monetary policy was noticed in the markets during the day. According to Trump, the euro is undervalued about 20 %.

In the tech-side some of the largest US states are trying to stop the megadeal between T-Mobile and Sprint. They warn that the mobile carrier merger would lead to higher consumer prices.

In London the FTSE 100 -index closed up 0,31 % to 7398 points and in Germany the Dax-index was also up, +0,92 % to 12155,81 points. In France, the CAC 40 index closed up 0,48 % to 5408,45 points.

In the Brexit situation, the EU is saying that there will be no new agreement between the parties. According to Sunday Times, the PM candidate Boris Johnson has said that UK should not pay 39 billion pounds settlement if they there is no new deal.

The new UK Prime Minister and the new Conservative Party leaders is announced on July 22. There are 10 candidates for this position. Between 19th-20th July MPs take part in ballots until only 2 candidates remain.

Business Finance Tech

US-UK trade deal on the agenda

The US and UK have been discussing about the trade deal between the countries after the Brexit deal, which is estimated to happen latest October 31st. This is part of the state visit of the US President Donald Trump and the UK royal family & Government.

According to the news conference on Tuesday, Mr Donald Trump said that the US-UK trade deal would have “tremendous potential” and coverage, even maybe the health care system NHS.

He also mentioned that the UK Brexit deal with the EU countries “will happen and should happen” and that it is important to deliver the Brexit. The US is offering the UK a broad free-trade agreement once the country has left the EU.

The UK Prime Minister Theresa May said also in the news conference that the UK should deliver the Brexit deal as the Goverment has been negotiated and that it is now the duty of the UK Parliament.

Mrs May is leaving the Downing Street 10 on Friday and the next Prime Minister will be chosen by the Conservatives during the summer time, maybe in July in the UK.

Business Finance

Brexit: Car production fell 44,5 % in April -Hammond to Tory race?

The UK car production fell 44,5 % in April according to the Society of Motor Facturers & Traders. The organisation estimates that the year-on-year production could fall by 10 %.

Manufacturing for domestic and overseas markets fell 44 % and 45 % respectively as the major companies were having production shutdowns due to Brexit timetable.

The Brexit-issue has also been in the politics. Chancellor of Exchequer Philip Hammond was speaking in the BBC Radio on Thursday and according to him the UK should reach to people if the UK Parliament cannot resolve the case. He was still stressing that the main objective for the Parliament is to proceed with the Brexit deal. He mentioned still that second referendum would be then better than a general election because of the hard situation in the Labour Party and Tories.

– It will be a stain on Parliament´s reputation if at the end, we have to admit that we have been unable to agree how to discharge the Brexit mandate from the people, he also said in the interview according to Independent newspaper.

Mr Hammond said he has a zero-tolerance approach to the breakdown or flouting of cabinet collective responsibility. He also mentioned that he might run for the Conservative leadership race  if there is no candidate who would reflect his thoughts properly.

Business Finance

Brexit: What next – stocks closed up

The yesterday announcement by the UK Prime Minister Theresa May that she will step down from the Party leader position on June 7 has left some questions how to proceed after this? Mrs May, who is highly respected by her counterparts, will stay as Prime Minister until the new leader is chosen- maybe in July.

The UK decision was not a surprise for the EU leaders. In fact, they were asking swift process in order to avoid possible bottlenecks between the countries business and economic transition process. For example the French President Emmanuel Macron said that he would like more clarification about the situation while “EU cannot remain indefinitely uncertain on Brexit”. According to him, France is ready to work with the new British Prime Minister on all issues.

The German chancellor’s Angela Merkel´s spokesperson said that Germany is ready to continue the work with Prime Minister Theresa May’s successor for an “orderly exit”.

And several other EU leaders have had same kind of message as well. They want to conclude the work and the agreement agreed with the EU and Mrs May. The message is still the same: the legal text of the withdrawal agreement will not be open.

This case has also raised the possibility of the no-deal Brexit after the Mrs May decision to leave. This is a major concern for the British Industry and the City as well. The Bank of England has made also several economic estimates which show that the no-deal Brexit would be catastrophic for the UK economy and for example housing prises.

The UK and EU have extended the Brexit deadline for several times and now the deadline is at the end of October, 31st. So, the UK Parliament has this timeframe in order to decide how to proceed. There is not that much time left, while it is assumed that the new UK Prime Minister might start his/her duties July/August time. As Prime Minister Theresa May said in her speech on Friday, the new leader will have to find a compromise in the Parliament in oder to get on with the Brexit.

On the other hand, it might also be possible, that the new Party leader is not willing to make a deal, so the no-deal Brexit might increase its appearance. According to Bloomberg News, two-thirds of Conservative members want a no-deal Brexit.

But the Labour Party in the UK Parliament is against no-deal scenario, which makes this approach uncertain. And the third option is also a new referendum or general elections, which would have to be before the end of October.

Now, in the middle of EU elections, the UK Conservative party is expected to face losses and this might have also its impact for the future of the UK and the Brexit process. The results of the EU elections are to be published on Sunday evening.

The UK stock markets closed Friday slightly up and the FTSE 100 -index ended +0,65 % to 7277 points. During one year time, the yield has been -1,68%. The pound was at 1,27 US-dollars, up 0,45 % on Friday. During a five year period the pound has fallen from the 1,7 US-dollars levels.

Business Finance

Brexit: Theresa May to step down June 7

The UK Prime Minister Theresa May says she will step down on the June 7 as a party leader. This announcement was expected after the weeks long public discussion of her successor. According to Mrs May, the successor will need to find Parliament Consensus on Brexit.

The London Stock Exchange FTSE 100 -index was trading up 0,59 % to 7273 points and the pound slightly up 0,17 % to 1,2676 dollars.

 

 

 

Business Finance