Brexit: No more time – new backstop?

After UK Brexit votes  this week, the situation with the UK- EU is still the same. No new news  – this means that solution is not ready yet. The UK Parliament agreed that the deal could be done if the Irish border issue, the backstop, would have a new approach. What that would be, is still unclear and the EU has said  on Wednesday that there would be no new agreements.

The UK Parliament voted that no new timeline was given, which means that the March 29th exit-day is still valid. Prime Minister Theresa May was granted a mandate to negotiate with the EU collaques about the Irish border issue. According to news agencies, she is not travelling to Brussels this week any more.

The UK Parliament is having the Brexit-vote on Valentine´s Day, the February 14th and according to Bloomberg, some EU diplomats are expecting to have the EU summit about the Brexit on the March 21-22.

The financial markets have seen increasing prices in spite of the turbulence in this Brexit-matter. For example in London the FTSE 100 -index ended up 1,58 % to 6941 points, but also the Wall Street increased to new level due to the news that the Federal Reserve will be “patient” with the future interest-rates moves. The Feds Funds Rate is now at 2,25 – 2,50 percent and the Fed is still having the 2 percent inflation target.

Dow Jones was up 1,61 % to 24976 points, the S&P 500-index was up 1,51 % to 2679 points and technology-index Nasdaq was up 2,01 % to 7169 points.

The US-China tradetalks are having a new chapter when the Chinese economic advisor, Vice Premier Liu He is meeting with the US Treasury Secretary Steven Mnuchin today and tomorrow.

In Asia, the stockmarkets were mixed while the HangSeng increased by 0,40 % to 27642 points and the Nikkei-index in Tokio decreased by 0,52 % to 20 556 points.

 

 

 

Business Finance

Brexit: Series of votes next week in the UK Parliament

The UK Parliament is having series of Brexit votes during next week.  There are different Brexit-options the MPs are voting, like to postpone the Brexit-exit, having no-deal Brexit or making no-Brexit deal impossible. Prime Minister Theresa May has said that she is against extending or making no-deal impossible.

The final Brexit exit-deadline, the March 29, is quite near and business leaders are unsure how the decision-process will continue and what would be the outcome. The Bank of England has warned about different kind of economic disruptions of no-deal Brexit.

According to Bloomberg, these companies have made their decisions to leave the UK or transfer part of the businesses outside the UK: AIG (Luxembourg), Admiral Group (Madrid), CME Group (Amsterdam), Cboe Global Markets (Amsterdam), Chubb (France), JP Morgan (Frankfurt), Liberty (Luxembourg), Pantheon (Dublin) and RSA (Luxembourg).

In the financial markets the big issues like the US-China trade talks are still in the process, but one of the US Goverment issues, the shutdowns will be ended by the Fed 15th.

During one month period, the Dow Jones -index has gained over 7 %, S&P 500 -index over 7 % and Nasdaq 8,8 %. In London the FT-SE 100-index has gained 1 %, while in Paris the index has gone up by over 5 % and in Frankfurt nearly 7 %. In Asia, the Tokio Nikkei index has gained 3,7 % and in Hong Kong the Hang Seng index 8,10 % during the period.

 

Business Finance

Stocks gained – no new news

Financial markets gained on the Wednesday trading in Wall Street. Dow Jones was trading 0,67 % to 23947, the tech- index Nasdaq was up 1,16 % to 6976 points. The composite index S&P 500- index was up 0,5 % to 2588 points.

The US-China trade talks gained also attention, when China committed to buy more US agricultural goods, energy goods and manufactured goods. Also president Donald Trump said that he is committed to make a deal.

In the UK the stocks ended up 0, 76 % to 3787 points. Prime Minister Theresa May was defending the Brexit plan. The Parliament is to vote about the deal on Tuesday next week. There were rumors in the EU side that the UK have to ask for an extention for the negotiating period.

In Germany the Dax- index ended up 0,83 % to 10893 points and in France the Cac- index ended 0,84 % to 4813 points.

In Asia the Nikkei-index ended up 1, 10 % to 20427 points. In Hong Kong the Hang Seng index ended up 2,27 % to 26462 points.

Business Finance

China easing auto tariffs for US cars -stocks gained

According to US Trump Administration, China has agreed to cut  tariffs on the US built autos and auto parts to 15 % from the current 40 % level. This news helped to heal the US stock markets and for example the automotive shares gained because of this.

The markets are also expecting that the wider trade talks between the US and China seem now a little easier for both parties. The countries agreed in the G20 meeting in Argentina to postpone the tariffs by 90 days.

Dow Jones ended down 0,22 % to 2437 points, S&P 500 -index ended down 0,04 % to 2636 points, but the Nasdaq-index ended up 0,16 % to 7031 points. In Europe the UK FTSE 100 -index ended up 1,51 % to 6835 points, the German DAX-index ended up 1,49 % to 10780 points and the CAC40 in Paris ended up 1,35 % to 4806 points.

The euro was trading flat at 1,13 dollars. The sterling gained slightly 0,01 % and was trading at 1,248 dollars.

The UK – EU Brexit situation is expected to gain some new input on Thursday and Friday, when the EU meeting in taking place. In the meanwhile UK Prime Minister Theresa May have had discussions with different country leaders about the Irish border issue and resassurances. Today she met the German Chancellor Angela Merkel in Berlin.

Many EU leaders have said that they want to help the UK to reach the Brexit deal in order to avoid the situation that there is no deal at all. The Bank of England has made analysis of the hard-case and the economic impact would be very difficult for the UK trade and economy.

Business Finance

Stocks down in Wall Street – crude oil up

Stocks continued their downward trend in Wall Street on Friday. The S&P 500 -index ended down by 2,33% and Dow Jones -index 2,24 % . The tech-intensive Nasdaq ended down 3,05%. Concerns over the global trade, oil prises and slower growth in US jobs in November were the topics.

The crude oil surged nearly 6 % as the Opec agreed more than expected production cuts. The Opec members agreed to cut the production by 1,2 million barrels a day.

This week for the stocks markets have been very volatile and the uncertainty over the Brexit vote in the British Parliament on the 11th December, global trade talks between the US-China and the moneraty policies in different continents have been the major news affecting the market sentiment.

According to Bloomberg News, the investment bank JP Morgan estimates that the US stocks can surge 17 % next year. The bank says the estimate is based on the fact that hedge funds hold fewer stocks than normal and returning to average holding would mean 500 billion dollars into US equities.

In Europe, the stock markets ended mixed. In London, the FTSE 100 -index was up 1,10 % to 6778, in Frankfurt the stocks declined sligthly by 0,21 % to 10788 and in Paris the CAC 40-index ended up by 0,68 % to 4813.

In Asia the stocks were also mixed. In Tokio, Japan, the stocks ended up 0,82 % to 21 687 points, but in Hong Kong the Hang Seng index ended down 0,35 % to 26063.

During one month period only the Hong Kong and Shanghai stock exchanges have been on positive trend. The other markets are in red ranging from the New York Nasdaq – 7,95 % to Tokio Nikkei -2,45%.

The euro was up 0,04 % to 1,13 US-dollars, but the UK sterling was down by 0,43 % to 1,272 US-dollars.

 

Business Finance

Wall Street down – trade talks and yield in focus

Wall Street fell sharply onTuesday due to the new concers over the US China trade talks and the Treasury yield curve.

According to markets, the Treasury 10-year yield curve, which indicates the coming recession, was one of the market concerns and the 10-yield hit its lowest value since September. The demand for longer-dated Treasuries rose.

Also President Donald Trump said on Tuesday that if the countries cannot solve the trade issues and differences, he is a “tariff man”.

Dow Jones fell 2,66 % and was 25 138 points. S&P 500 index fell 2,17 % to 2729 points and Nasdaq dropped 3,21 % and ended at 7202.

In Europe the decline was modest. In London the FTSE100  fell 0,56 % to 7022 points and German Dax-index 1,14 % to 11 335. In Paris the CAC40 -index ended down 0,82 % and was 5012. In Asia the stock markets were mixed and for example in Hong Kong the stocks rose 0,29 % , but in Tokyo the markets fell 2,39 %.

The UK Parliament was having Brexit discussions and the Parliament voted about the legal advice related to the topic. The outcome was that the Goverment will have to publish the full disclosure of the Brexit legal advice.

Euro and sterling ended slightly down and euro was 1,1341 dollars and sterling 1,2716 dollars.

The US stock and bond markets will be closed on Wednesday.

Business Finance

G20: US and China to halt tradewar

During the G20 meeting in Argentina the US and China leaders, President Mr Donald Trump and China President Mr Xi Jinping agreed to halt the escalating trade war.

According to the White House spokesperson,  President Trump would not follow through his threat to raise tariffs on Chinese goods from 10% to 25% in the new year.  This has been the major issue in the discussions and also one of the biggest threats to global economy.

The countries also agreed that China will buy more agricultural, energy and industrial products from the United States. The aim is to reduce the trade imbalance between the countries.

According to White House, this new statement gives both countries 90 days time to agree upon new trade terms. If such agreement is not ready, the former tariffs increase from 10% to 25 % will become into force.

The financial markets ended up in Wall Street on Friday evening. Dow Jones ended +0,79 % to 25538, S&P 500 + 0,82 % to 2760 and Nasdaq 0,79 % to 7330 points. In Europe the markets were down with the FTSE 100 -index -0,83 % to 6980 and German Dax-index -0,36 % to 11 257 and CAC 40-index in Paris -0,05% to 5003.

Euro declined 0,67 % to 1,13 US-dollars and UK sterling ended down 0,33 % to  1,27 US-dollars.

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