British manufacturer Galliford Try added his voice to the chorus urging parliamentarians to avoid a Brexit without a contract.
In its latest financial results, the company says that stepping out of the EU would severely damage the economy:
We believe that a controlled departure under a withdrawal agreement between the UK and the EU will not have a significant direct impact, with supply chains and European and foreign labor able to adapt over time as they are clarified. the detailed future provisions.
If the United Kingdom leaves without a contract, the greatest impact we expect is the effect on our markets and, in particular, on the Linden House market, of a potential serious decline in consumer confidence and economic activity in general
Galliford Try adds that he has taken steps to protect his company from the lack of critical materials and products, but it is "impractical to try to completely isolate our business".
The British FTSE 100 opened 25 points more at 7.157.
This brings him closer to the last four months of last week.
Paul Donovan of UBS Wealth Management says the hopes for a trade agreement between China and the United States are exploding, especially following Donald Trump's comments.
Investors on the stock market can practically taste the beautiful piece of chocolate cake served on a plate at Lake Mar.
The enthusiasm for the prospect of a trade agreement between China and the United States has led the actions to recovery. The hope is that not only will there be no new taxes, but some of the existing taxes could be reversed.
The pound is swinging around the dollar by $ 1.29 against the US dollar this morning, approximately where it ended yesterday. The data on today's inflation could however shift the currency pair.
Asian markets increase in commercial optimism
Asian markets reacted positively to Donald Trump's suggestion, reaching the highest levels in four months.
The Chinese Composite Index of Shanghai has grown by 2%, as the optimism shows that it is possible to avoid new tariffs.
The Japanese Nikkei gained + 1.34% and the Hang Seng of Hong Kong rose by 1.1%.
Senior US officials, including Treasury Secretary Steven Mnuchin, will hold major commercial talks in Beijing tomorrow. So we could be close to a turning point.
Jim Reid of Deutsche Bank claims that Trump's suggestion to let the March 1 "slips" tariff maturity are moving markets.
US negotiators are having high-level meetings with Chinese officials in Beijing this week, and flexibility on expiration would reduce the pressure for an immediate turnaround.
Any delay at higher rates would be good for the markets, so the news was greeted by an equity rally, with cyclical and trade-based stocks outperforming.
Trump: I could extend the expiration of the deal trade (maybe)
During the night, Donald Trump hinted that he could extend the deadline to reach a trade agreement with China.
The president of the United States revealed that the existing plan – for a trade agreement by March 1 – could be redefined if Washington and Beijing are making progress.
Trump told a cabinet meeting that:
"If we are close to an agreement where we think we can do a real deal and it will be done, I could see myself leaving that slide for a while."
"But in general, I'm not inclined to do it."
If no agreement is reached, America will raise the tariff of about $ 200 billion of Chinese imports from 10% to 25%, which could have a serious knock-on effect on trade.
The agenda: day of inflation in the United States and the United Kingdom
Hello, and welcome to our continued coverage of the global economy, financial markets, the eurozone and business.
A double dose of cost-of-living data should keep investors at their tips this morning, as the optimism of a trade war agreement continues to grow.
Inflation in the United Kingdom (expected at 9.30) is expected to fall from 2.1% to 2% in the year. This would give the Bank of England the rare treatment of effectively hitting the consumer price index – if only for a month.
In normal times, the IPC would be a good reference point for future increases in interest rates, and therefore the value of the pound. But right now, the development of Brexit – and the last distracted discourse in the bars of Brussels – probably has a greater impact.
It is also expected that US inflation will ease. The cheaper energy could reduce the US annual CPI index by only 1.5% or 1.6% today, from 1.9% in December.
But any signal of inflationary pressures gurgling beneath the surface will alarm central bankers of America at the Federal Reserve, as they wonder whether to raise interest rates again.
As Elsa Lignos of Royal Bank of Canada explains,
The US headline inflation trend will be weak in the first half of 2019, but it all boils down to energy prices. Underlying this, core inflation should indeed be quite robust (our economists note that demand is strong, as evidenced by strong sales of chain stores and very healthy growth in income). The Fed has explicitly said it can wait until inflation is under control – so a stronger inflation supports a less accommodating perspective and a stronger dollar.
We also receive new data on UK home prices and a healthcheck on eurozone factories.
L & # 39; agenda
- 9.30 GMT: consumer price index in the United Kingdom for January
- 9.30 GMT: data on UK home prices for December
- 10:00 GMT: Eurozone industrial production for December
- 13.30 GMT: US consumer price index for January