Good morning. The FTSE 100 fell for a fourth successive session yesterday and is on track for its worst week since January 2016 following a slew of poor economic data and Brexit pressures.
Around £ 95 bn has been wiped off the market value of London’s biggest firms this week, including Wednesday’s 3.2pc wipe-out, hitting millions of savers’ pension investments as traders fret over the severity of a global economic slowdown. Miserable data from mainland Europe and the US suggested the whole world is slowing sharply, let’s see what today will bring.
5 things to start your day
1)Does the deluge of FTSE bosses departing signal trouble ahead?Whenever a company boss departs, it feels personal. Whether they go out on a high or are axed by a furious board, any FTSE chief’s exit is inevitably seen through the simple prism of their own success or failure. But this week’s departures by Dave Lewis from Tesco and Alison Cooper of Imperial Brands carry a broader significance.
2)Will Remainers cancel Christmas? Only Brexiteers plan to splash out on presents this year: Around 30 pc of Remain voters say Brexit is the biggest cause of concern affecting their confidence to spend, compared to just 6pc of Leave voters. Some 86 pc of Brexiteers believe that Brexit is “Not important at all” in their spending decisions while almost half of Remainers plan to spend slightly less or much less for this Christmas.
3)Awkward!Firm founded by David Cameron’s mother-in-law warns of hit from Brexit: A high-end furniture seller co-founded by David Cameron’s mother-in-law has warned its earnings could be hit by Brexit as losses widened. Oka made £ 32 m of revenue from selling dining tables and sofas for as much as £ 6, 050, but losses widened to £ 8.2m from £ 180, 000 for the 11 months from January to the end of December, Companies House accounts showed.
4)Thomas Cook’s collapseis expected to cost the taxpayer an extra £ 60 m in unpaid wages, holiday pay and redundancy fees. The bill – which is on top of the cost of repatriating more than 150 , 000 holidaymakers – was revealed as it emerged that Brussels rules prevented hundreds of Thomas Cook shops from accessing a critical tax break ahead of the firm’s collapse.
5)Gisela Abbam, the first black chair of the British Science Association,has been named Black British Businessperson of the Year. At a ceremony at St Paul’s Leonardo Royal Hotel in London tonight, Ms Abbam, who has also negotiated World Trade Organization level trade policy, on the elimination of tariffs on key medical devices to enable increased access for patients in 80 countries, said she was “humbled and honored” to win the prestigious award.
What happened overnight
Stocks in Asia were mixed Friday as investors awaited the key monthly American employment report and subsequent comments due from Federal Reserve Chairman Jerome Powell. Treasuries retained an overnight advance.
Japanese shares edged lower, with the Topix index at risk of capping its biggest weekly decline since May. Equities in Hong Kong, South Korea and Australia were little changed.
Earlier, the S&P 500 rose the most in a month after climbing back from a drop of more than 1pc sparked by the weakest reading on the US services sector in three years. Market pricing for a Fed interest-rate cut at the next meeting climbed.
This week’s slew of poor data confirmed the global economy is struggling for traction, and went some way to validating concerns the weakness may be seeping from the manufacturing sector into consumer sentiment, as the US-China trade war continues.
That’s also driving bets that the Fed will pump more stimulus into the economy this year. Focus now turns to the non-farm payrolls figure, and then to Powell’s address later Friday.
“The facts are that the U.S. consumer still looks terrific, we’re coming into a third quarter earnings season where we’re not seeing revisions downward or upward either, and that’s all pretty good news for the market, ”Sherry Paul at UBS Global Wealth Management told Bloomberg TV. And then “we combine all that with the beating drum of the Fed, continuing their rate policy.”
Meantime, China remains shut amid a week-long holiday.
Coming up today
Full-year results:Bailie Gifford Japan Trust, Henderson Eurotrust
Economy:Balance of Trade (US), Non-Farm Payrolls (US), Unemployment Rate (US)
- On September’s US non-farm payrolls data, the consensus is for 146, 000 jobs, but the whisper number is 125, (after a disappointing ADP report.)
- Federal Reserve Chairman Jerome Powell is set to speak.
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