US Senate backing Hong Kong protesters

The US Senate has passed a bill to support the protesters in Hong Kong on Tuesday. The bill is also a signal that the violence in the streets of Hong Kong must be stopped.

The US and China are having trade talks and it is expected that the Hong Kong situation will be integrated to the US  China trade deal. The months long demonstrations in Hong Kong have become more violent during the recent weeks.


Business Finance Travel

BoE to keep rates unchanged – bank stocks surged in Europe

The UK Central Bank, the Bank of England kept its key base rate unchanged today in its meeting.  According to the central bank, the inflation target 2 % remains also the same. The bank also commented that the outlook for the global growth has weakened due to the US China trade talks since their earlier meeting.

– In the event of a no-deal Brexit, the exchange rate would probably fall, CPI inflation rise and GDP growth slow. The Committee’s interest rate decisions would need to balance the upward pressure on inflation, from the likely fall in sterling and any reduction in supply capacity, with the downward pressure from any reduction in demand. In this eventuality, the monetary policy response would not be automatic and could be in either direction, the bank said in its release.

Yesterday the US Federal Reserve cut the fed funds rates to be 1,75% to 2 %. The Fed also has been active in the money markets adding the liquidity three times during this week.

In Japan the Bank of Japan also kept the rates unchanged in its meeting today on Thursday. On the other hand the Hong Kong Monetary Authorities said that they have lowered the key rate accordingly to the Fed decision, to 2,25 % from 2,5%.

The German 10-year government bond yield was -0,51 %, the UK Gilt´s 0,63% and the US´s 10 year Treasury 1,77%. In France the 10 year bond was yielding -0,22%.

Euro was trading up 0,12 % at 1,10 dollars. Sterling was also up, 0,02 % to 1,247 dollars.

The stock markets surged in Europe today. The Dax-index closed up 6,34 % to 12 457 points, the CAC 40-index increased 5,35 % to 5659 points points in France and the FTSE 100-index closed up 2,32 % to 7356 points in London.

The banking sector were higher in Europe due to the European Central Banks decision to lower the long-term funding (TLTRO III)  for lenders. It became effective today.  The ECB also announced on the 12th September meeting that the maturity of the refinancing operations will be extended to three years.


Business Finance

Hong Kong to make rival offer of London Stock Exchange – FT (updated)

The Hong Kong Stock Exchange is making a rival offer of London Stock Exchange, LSE. According to Financial Times, the deal would be worth of 32 billion pounds.

According to the Hong Kong Exchanges & Clearing Ltd CEO Charles Li they considered the offer for months. He says that the combination would be rationale for many reasons and one of them is the assets trading in euros, dollars and renminbi.

– First, LSEG is one of the most well-known, highly respected and successful exchange groups in the world. Based in London, it is a global offshore centre for Eurodollars. Likewise, HKEX is one of the top Asian exchange groups based in Hong Kong, the world’s leading offshore market for Renminbi. A combination of two markets of this size and significance has never been done before and would create a globally-connected exchange group that serves as the leading international platform for financial assets denominated in US dollars, Euro and Renminbi, the CEO Li says in his blog today.

The HKEX has offered 20,45 pounds a share in cash and 2,495 new HKEX shares, which would make a 23 % premium to LSE´s closing price yesterday, the Financial Times says. The shares of LSE are trading up about 8 % to 7368 pounds in London.


Business Finance Tech

China to lead the Swiss Watch export – growth double digit

China has shown the biggest demand for Swiss Watches during the October 2018 figures, according to the Swiss Watch Industry. Watch industry exports have reverted to the sustained trend and totally it was 1987 million Swiss francs, which is 7,2% higher than year ago.

Hong Kong gained 10.3% and the United States 11.1%. China recorded one of its biggest monthly increases for the year at +24.1%.

The main European markets such as the United Kingdom (+5.0%), Germany (+8.7%) and France (+11.6%) were having positive trend, but Italy (-14.7%) and Spain  (-14.7%). exports were declining.