Graeme Wearden, Julia Kollewe and Jasper Jolly 

US stock markets hit new record highs amid trade deal optimism – as it happened

Rolling coverage of the latest economic and financial news
  
  

Wall Street stocks jumped on optimism for progress in US-China negotiations.
Wall Street stocks jumped on optimism for progress in US-China negotiations. Photograph: Johannes Eisele/AFP via Getty Images

US stock markets have retreated slightly from previous highs after the factory data.

Investors face a tricky balancing act, with a darkening economic picture on the one hand and an unpredictable political environment on the other.

On the other side of the coin, data just in on US factories makes for less optimistic reading.

US factory orders fell by 0.6% in September, according to the US Census Bureau. That was worse than the 0.1% fall in August, and also lower than the 0.5% decline expected by economists.

Non-defence aircraft were the second-biggest fallers, although the shadow cast by Boeing’s 737 Max crisis is likely an important factor.

A fun graph: the Dow Jones industrial average from its inception to its latest record high.

Be slightly wary though: the nature of the index means that the Great Depression (around the 1929 mark) registers as barely a blip on this scale – when in fact it was a traumatic period for the world.

US President Donald Trump has (perhaps predictably) welcomed the record highs on stock markets.

Perhaps slightly more surprisingly, he tweeted it before markets opened – presumably gambling that futures markets were accurate.

US stock markets hit record highs in early trading

The opening bell in New York has delivered some noteworthy new records.

  • The S&P 500 rose above 3,066.95 points, a new record high.
  • The Nasdaq opened at a new record, to 8,444.99 points.
  • Dow Jones industrial average up 0.46%.

European shares continue to push higher, notching up increases of more than 1%. The FTSE 100 index in London is up 1.2%.

Wall Street is expected to open at record highs in just a few minutes, as optimism about the likelihood of a US-China trade deal spreads. Stock futures are pointing to a rise of 178 points on the Dax, up 0.65%, while the S&P 500 is expected to open 19 points higher, or 0.63%, and the Nasdaq is seen rising 65 points, or 0.8%.

MPs reiterated their concerns over potential conflicts of interest at the accounting firms, and called for a clear separation between the audit and non-audit parts of thier businesses. PwC earned £4m from providing “recruitment and remuneration” advice to Thomas Cook while also auditing its accounts.

Turning to the audit of Thomas Cook’s accounts, which was initially carried out by PwC and later EY, MPs said they had found a large amount of goodwill that was not written down until this year – similar to the collapsed construction contractor Carillion. Goodwill is an accounting concept that refers to the intangible asset of an acquired company which measures things like reputation, customer base and brand value.

We are therefore very disappointed to find yet another corporate collapse in which goodwill has played a major part.

Both PwC and EY told us that they asked the right questions and challenged Thomas Cook’s management. EY said that they had followed accountancy standards and procedures in this respect.

If the latter is true, and goodwill is being treated in this way across the FTSE 350, it should be cause for grave concern. This would mean that more Carillion and Thomas Cook collapses are potentially already locked into the system.

It also presents a picture of audit automatons that are incapable of drawing the most basic of conclusions from a balance sheet, questioning what they add to the corporate reporting process.

Reeves and the rest of the committee recently quizzed bosses from PwC and EY, and accused them of being complicit in the failure of Thomas Cook, Carillion and other firms.

MPs said they were “shocked to learn” that Fankhauser, who ran Thomas Cook from 2014 until his collapse, received an annual cash allowance worth 30% of his base salary for his pension contribution. The committee’s recommendation is:

As with executive pay, changes to executive pension contributions are needed in order to create a fairer system. We expect the FRC’s replacement to have a role here, alongside pressure from investors, stakeholders and remuneration committees.

The committee also called for stronger legal provisions on clawback of bonuses.

Updated

And here are the BEIS committee’s recommendations to the government, to prevent another massive corporate failure like Thomas Cook.

MPs have recommended that executive bonus schemes set by companies’ remuneration committees are “not only robust, but the measured data on which they are based is too”. They flagged up that the performance measures at Thomas Cook in 2018 did not directly address high levels of debt – highlighted by the former CEO Peter Fankhauser himself as a key cause of the group’s ultimate demise.

You can read the full letter from Reeves to Leadsom here.

My colleague Rob Davies reported at the time that the business secretary, Andrea Leadsom, did not speak to Thomas Cook executives during increasingly frantic talks between the company and the government leading up to its collapse. He wrote:

Records of telephone calls and meetings, seen by the Guardian, indicate government ministers were aware the 178-year-old tour operator’s finances had been deteriorating for months.

But the documents show Leadsom and ministers and officials from the Department for Business, Energy and Industrial Strategy had little to no discussion with the company about its ailing balance sheet until after it had entered liquidation.

Updated

The business, energy and industrial strategy committee has called on the UK government to push ahead with measures to help avoid the next corporate business failure, following the collapse of Thomas Cook, the world’s oldest travel company, in September.

It has written to business secretary, Andrea Leadsom, to express disappointment that the government did not press ahed with audit reforms and and bring forward legislation to replace the Financial Reporting Council with a more effective body, the Audit, Reporting and Governance Authority. The committee recommended a new government push by including the legislation in the first Queen’s Speech of the new Parliament.

Rachel Reeves, chair of the BEIS committee, said:

Our inquiry has been cut short by the election but it’s clear that a series of misjudgements at Thomas Cook led to its collapse. The piling up of debt, confused business plans, lack of challenge in the board room and by auditors, and aggressive accounting practices all contributed to the failure of the business.

During our inquiry, we’ve witnessed buck-passing and blame-shifting but precious little humility or reflection from those at the top of the business. Directors and senior management pocketed hefty sums in annual salaries and bonuses that Thomas Cook staff will only have dreamed of earning throughout their entire careers. Mr Fankhauser [the former CEO] told us he would reflect on the huge salaries he has earned. Given the riches which Thomas Cook poured into his pockets I hope that Mr Fankhauser will realise that now is the time to put right the wrong he has done.

She also criticised the business department and business secretary for their role in the debacle:

The failure at Thomas Cook has been also been notable for the extraordinary lack of interest shown by the Business Department and its Secretary of State in the days and weeks leading up to the collapse.

Updated

A summary

Time for a recap:

Britain’s construction sector has suffered another contraction, as Brexit uncertainty hits builders. Civil engineering activity fell at the fastest pace in a decade in October, with large projects on hold.

Eurozone factories also contracted last month, led by the ongoing manufacturing recession in Germany. Italy and Spain also struggled, but French industry posted some growth.

Global stock markets are rallying, on hopes that Donald Trump and Xi Jinping could sign a provisional trade deal this month. Britain’s FTSE 100 has gained more than 1%, while the pan-European Stoxx 600 index is at a 21-month high.

Shares in gambling firms have fallen sharply, as MPs plan new curbs on online betting.

The oil price is also rising today, on hopes that a US-China trade deal would boost growth - and demand for energy.

Brent crude has gained 1.5% to $62.58 per barrel.

Rupert Thompson, Head of Research at Kingswood, says investors are hopeful that the global economy is picking up, after some weak months:

Following a couple of failed attempts in July and September, global equities finally last week broke clear of their January 2018 high. Importantly however, at least for UK investors, the break higher is only in local currency terms. The recent bounce in the pound means global equities, in sterling terms, are still languishing some 4% below their July high. The break higher has been fuelled by increased hopes that global growth is bottoming out. Growth was higher than expected in both the US and Europe in the third quarter and little changed from the previous quarter.

US employment gains also beat expectations. They are an important source of support for consumer spending which remains robust and is compensating for falls in business investment. Even so, signs of an actual pick up in global growth are still very tentative.

Manufacturing will lead any recovery, just as it has led the slowdown, and the latest numbers are painting a mixed picture both in the US and China. Conflicting signals, however, are to be expected at this stage. Turning points are almost always never clear cut - except with hindsight.

Here’s our news story on the UK construction sector’s malaise:

The Boeing 737 Max crisis continue to loom over the airline industry.

Ryanair has warned today there is “a real risk” it will have no Boeing 737 Max planes flying next summer, if the grounded aircraft doesn’t return to service soon.

My colleague Julia Kollewe explains:

Europe’s biggest carrier is sticking to its plans to cut bases and pilot and cabin crew jobs and said it expected to receive its first 737 Max planes in March or April 2020, two months later than expected. The 737 Max remains grounded worldwide after two crashes in Indonesia and Ethiopia killed 346 people.

Ryanair’s chief executive, Michael O’Leary, said: “We have now reduced our expectation of 30 Max aircraft being delivered to us in advance of peak summer 2020 down to 20 aircraft and there is a real risk of none.”

Markets push higher as trade deal hopes grow

European stock markets are pushing higher, despite the weak eurozone factory data and ongoing slump in UK construction.

Investors are clinging onto hopes of a breakthrough in the US-China trade talks, following hints that Donald Trump and Xi Jinping could sign a ‘Phase One’ deal this month.

In London, the FTSE 100 index has now gained 83 points, or 1.1%, to 7386 - a one-month high.

The Europe-wide Stoxx 600 index is now 1% higher, at a new 21-month high.

President Trump would obviously like a trade war ‘win’, even though a comprehensive deal seems to be some distance away.

Any breakthrough could encourage Trump to drop, or postpone, planned tariffs hikes on Chinese-made technology goods due to kick in next month.

Pierre Veyrett, technical analyst at ActivTrades, says the US-China trade talks are the main factor driving the markets.

Investors welcomed the significant recent progress on intellectual property theft issues, even though this topic hasn’t been entirely solved yet (some issues may slip to the phase 2 of the deal). A new venue is still to be agreed for a November US-China meeting with President Trump wanting the interim deal to be signed somewhere on US territory.....

We believe optimism surrounding the trade dispute is likely to keep on supporting stock prices around the globe this week, especially if US and Chinese data is in line with or continues to beat expectations like last week’s solid non-farm payroll reports.

India’s stock market has also got the message, closing at a new record high:

Gambling firms shares slide as MPs demand crackdown

Shares in Britain’s gambling companies have also fallen heavily this morning, as parliament pushes for a radical overhaul of the online betting industry.

My colleague Rob Davies broke the news overnight. MPs are demanding a “root and branch” overhaul of gambling law, that would mirror a recent clampdown on high street bookmakers.

A new report from the all-party parliamentary group (APPG) makes several key recommendations that would protect vulnerable gamblers, including:

  • A £2 stake limit on online slot machines.
  • An end to betting by credit card.
  • Restrictions on “VIP” accounts that can allow people to run up huge debts
  • An investigation into non-disclosure agreements between bookmakers and customers

APPG hopes the report will influence government policy, regardless of who wins next month’s election.

GVC Holdings, which owns Ladbrokes and Corel, has tumbled by 10% this morning, followed by William Hill (-7%), 888 (-4.7%) and Flutter (formerly Paddy Power) (-2.1%).

Here’s Rob’s story:

Updated

Experts: Mothercare administration shows high street struggles

Back in the City, shares in Mothercare have now sunk 30% to a new alltime low after it decided to put its UK operations into administration:

Andy Brian, partner and retail expert at law firm Gordons, says supermarket chains helped to destroy its business model.

“The reality is that Mothercare operates in an increasingly competitive sector in the UK, where price-driven customers can easily compare the price of big ticket items online and buy smaller items such as children’s clothing in their local supermarket. It tried, and failed, to make its stores more appealing to young mums in particular, and is yet another stark example of a retail brand to which many feel a nostalgic affinity without actually feeling the need to regularly shop there.

Julian Pallett, Head of restructuring and corporate recovery at law firm Gowling WLG, says the high street needs more help:

Mothercare is the latest in a long line of businesses struggling to adjust to the rapidly changing retail landscape. The insolvency regime in the UK provides a robust and flexible framework, through CVAs and other procedures, to enable businesses like Mothercare to reshape their liabilities and retail footprint, but often this isn’t enough.

Reducing the rent roll and business rates can help a lot, and may also help landlords avoid having empty properties in key locations. In order to survive however, retail businesses may need to go further and look for a radical re-positioning of their business structures and offerings, if they are to survive in the longer term in the face of structural shifts in buying habits and competitor offerings. It’s in the interest of all stakeholders, including employees, suppliers, landlords and customers that such efforts are successful.

The high street needs all the help it can get.

The UK construction PMI report is online here.

Construction slump: What the experts say

Jan Crosby, UK head of infrastructure, building and construction at KPMG, warns that confidence across Britain’s building industry is weak.

Here’s his take on today’s weak construction PMI report.

“There had been pockets of optimism in the run up to October 31, largely because people were looking forward to some form of clarity around the future of the sector, but Brexit uncertainty has returned once more, coupled with a general election to boot.

“There is widespread evidence of a sluggish housing market, which is likely causing some housebuilders to slow build rates on sites - particularly those not benefiting from Help to Buy. Meanwhile, the commercial sector also appears to be struggling, with investment in the likes of grade-A office space drying up amid the uncertainty. Many clients are likely to hold off until next year before committing to any large-scale projects in the hope they can make more informed decisions. For now, it’s a case of sitting tight.”

Gareth Belsham, director of property consultancy and surveyors Naismiths, says builders are suffering from a drop in new business:

Investor appetite remains deeply fragile and many contractors are being pummelled on three fronts. Just as their order books get thinner and erode their confidence, they are being forced to bid low for the shallow pool of new work available – while at the same time input costs go up and slice into their margins.

“No wonder many construction firms are trying to cut costs where they can, and staffing levels have fallen every month since April.

“Nevertheless there are some glimmers of hope. While Britain’s Brexit agony has been put on pause by what promises to be an equally divisive election hiatus, the chances of a chaotic ‘no-deal’ exit have at least diminished.

Mark Robinson, chief executive of procurement specialists Scape Group, blames Brexit deadlock:

“Today’s data paints an even gloomier picture for construction bosses after an already difficult year. Construction firms are continuing to be knocked from both sides as new work continues to decrease and prices soften. SMEs in particular will be feeling the squeeze, as staffing levels drop and companies race to the bottom to secure the limited amount of contracts that are being pushed forward.

“British building has largely been put on hold while government gets its ducks in a row, but as our EU exit date continues to be pushed back we cannot continue to stand by and watch the industry shrink

Updated

CIPS: Britain's building industry is lying in a ditch

The construction industry is always vulnerable to political and economic uncertainty, as today’s PMI report proves.

When growth is weakening, it’s hard to persuade clients to invest in major projects - such as a new house or office block. If politicians are caught up in one crisis, they can’t focus on other priorities such as transport infrastructure.

Duncan Brock of the Chartered Institute of Procurement & Supply, says Britain’s politicians have hurt the building sector:

“The construction sector’s distressing decline continued in October in spite of a small improvement in the headline index as a resolution to the political impasse seemed close. However with a fall in civil engineering not seen for a decade and the biggest drop in housebuilding since 2016, it appears that strength in the sector is seeping away.

“Jobs hiring suffered as businesses unsure of the Government’s next steps held back on their development plans, which were weakened further by stronger competition for fewer opportunities. Future optimism remained at 2012 levels as the deep-seated Brexit gloom dampened down expectations.

“To say these figures are disappointing is a big understatement. Given that the next political hurdle is December’s General Election, all eyes will be on the new administration and clear direction, because at the moment there is little insight into what could possibly pull the sector out of its ditch.”

Some instant reaction to the latest slide in UK construction:

Tim Moore, economics associate director at IHS Markit, says UK construction is enduring its worst slump in several years.

He blames the political uncertainty, and growing doubts over some major construction projects (perhaps the HS2 railway scheme which is now being reviewed?)

Moore says:

“UK construction companies experienced a downturn in business performance during October as political uncertainty and subdued economic conditions again combined to hold back sales. New orders have fallen in each month since April, which is the most prolonged period of decline recorded for more than six years.

“Civil engineering was the worst-performing area of activity in October, with business activity dropping at the fastest pace in ten years. Construction companies also voiced concerns about the uncertain outlook for large-scale infrastructure projects upon which growth is expected to rest in the coming years.

“House building has also lost momentum this autumn amid a broader slowdown in market conditions, with the latest survey data signalling the sharpest drop in residential work since June 2016.

Worryingly, business optimism among construction firms is languishing at its lowest levels since 2012.

UK construction sector hit by Brexit worries

Newsflash: Britain’s construction sector has suffered another sharp drop in activity last month, as Brexit uncertainty hits the building industry.

Firms have reported they suffered another drop in work, for the sixth month in a row. New orders fell too, forcing construction firms to cut jobs.

Civil engineering shrank at its fastest pace since October 2009, while housebuilding also contracted more rapidly.

This pulled the Construction PMI index down to 44.2, below the 50-point mark separating growth from contraction (but up from September’s 43.3).

As you can see, the sector has been shrinking since early this year:

Data firm Markit blames political uncertainty -- ie Brexit -- which is deterring potential clients from committing to new projects.

New orders dropped for the seventh month in a row during October, but the rate of decline was the least marked since July.

Construction companies noted that clients continued to defer decision-making on new projects in response to political uncertainty and concerns about the economic outlook. Survey respondents also suggested that intense competition for new work had resulted in more widespread price discounting to secure contract awards.

Updated

Germany’s slump has helped to drag the wider eurozone factory sector down again.

The Eurozone Manufacturing PMI, which tracks activity across the euro area, has come in at 45.9 in October. That shows another sharp fall in activity and output, although slightly better than the seven-year low of 45.7 recorded last month.

Data firm Markit says there is a “sustained weakness in output, new orders and purchases across eurozone factories.

Faced with this slump, bosses are cutting jobs at the fastest rate since 2013.

Encouragingly, there is solid growth in Greece, and more modest growth in France, Ireland and the Netherlands.

Phil Smith, Principal Economist at IHS Markit, says Germany’s factory sector is enduring its worst slump since the financial crisis:

“The German manufacturing sector remains in recession and continues to pose a threat to the domestic economy through a rising number of factory job losses.

Employment across the goods-producing sector is now falling at the fastest rate for the best part of ten years, though it should be said that the decline is nothing like that seen during the depths of the global financial crisis, and is so far mainly restricted to contractors.

But there may be hope ahead:

“The survey’s more forward-looking indicators offer some glimmers of hope. Latest data for new orders and output expectations were still very weak in October, but nevertheless the best seen in four months.

It remains to be seen if the downturn in the German manufacturing has finally reached a nadir – much of course depends on developments in global trade, with the US set to decide next week whether to impose new tariffs on automotive imports from the EU.”

German factories still in recession

Germany’s manufacturing sector has endured another torrid month, raising concerns that the country is in recession.

New orders at German factories fell for the 13th month running in October, while employment levels fell at the fastest rate since January 2010.

Manufacturers are running down their inventories at a rapid rate, rather than invest in new stock. Firms were also forced to slash prices to generate business - average prices at the factory gate fell at the fastest rate in almost a decade.

This dragged the German manufacturing PMI down to 42.1 in October. That’s up from 41.7 in September (a 10-year low). Such a low figures suggests a sharp fall in activity (any reading over 50 shows growth).

Data firm Markit, which produces the report, says Germany’s manufacturing sector remained firmly in contraction.

Surveyed businesses reported a backdrop of uncertainty weighing on investment and leading to a general reluctance among clients. New orders fell markedly and for the thirteenth month in a row in October.

More to follow....

France’s factory sector shrugged off the wider malaise, by posting modest growth last month.

The French manufacturing PMI has risen to 50.7, from 50.5 in September.

Companies took on more staff to handle an increase in production, data firm Markit reports.

Italy’s factory sector also had a bad October, shrinking for the 13th month running:

Spain's factories hit by political woes

Oh dear. Spain’s factory sector contracted at a faster rate last month.

The Spanish manufacturing PMI has dropped to 46.8, down from 47.7 in September, showing another drop in activity.

It’s the fifth monthly fall in a row, as the political deadlock in Spain hurts the economy.

Markit, which produces the PMI report, says:

The deterioration in the PMI was led in the main by a sharp and accelerated drop in new orders.

Against a backdrop of elevated economic and political uncertainty, both at home and abroad, there were widespread reports of underwhelming market demand and clients adopting a cautious approach to their buying and investment activities.

Last April’s general election delivered a hung parliament, so Spain is returning to the ballot box later this month.

French stock market hits 12 year high

Back in the markets, stocks are rising across Europe in early trading.

Investors are taking their cue from Asia, and the optimism over US-China trade talks.

France’s CAC index is leading the charge; up 0.6%, to its highest level since 2007.

Germany’s DAX has gained 0.7% to its highest level sine June 2018.

This has driven the Stoxx 600 index, which includes Europe’s largest 600 listed companies, over 400 points for the first time since January 2018.

Here’s our news story on Mothercare UK’s administration:

Shares in Mothercare have fallen 15%, to a record low of 9p. That values the company at just £33m.

Investors have been almost wiped out over the last decade -- the shares were trading at 450p in January 2010.

Analyst: Mothercare left behind.

Mothercare UK’s slide into administration is a sad moment, and a real blow to its staff.

But it’s not a shock.

The high street chain has been struggling for years, facing rising competition from online rivals. The days when expectant parents would pop into their local Mothercare en masse, and leave carrying an expensive pram, cot, and armfuls of toys and bibs are over.

Richard Lim, CEO at Retail Economics, says this is “one of the most highly anticipated collapses” in recent years.

“Years of underinvestment in the online business and its inability to differentiate itself as a specialist for young families and expectant parents as been the root of its seemingly inevitable downfall. As competition has become fiercer they have been beaten on price, convenience and the overall customer experience.

“Put simply, they have been left behind in today’s rapidly evolving market and the board has been unable to restructure the business fast enough to cope with a new retail paradigm that has emerged.”

Updated

Mothercare to put UK business into administration.

Newsflash: The UK arm of maternity and baby retailer Mothercare is to be put into administration.

The move puts thousands of jobs on the UK high street at risk.

In a statement to the City, Mothercare says that it will appoint administrators, having concluded that it cannot bring its 79 stores back to ‘sustained profitability’.

The move will not affect the rest of Mothercare, which also operates a profitable franchise business overseas.

The company says:

Since May 2018, we have undertaken a root and branch review of the Group and Mothercare UK within it, including a number of discussions over the summer with potential partners regarding our UK Retail business.

Through this process, it has become clear that the UK Retail operations of the Group, which today includes 79 stores, are not capable of returning to a level of structural profitability and returns that are sustainable for the Group as it currently stands and/or attractive enough for a third party partner to operate on an arm’s length basis. Furthermore, the Company is unable to continue to satisfy the ongoing cash needs of Mothercare UK.

Asian markets rally

The main Asian stock markets are all comfortably higher today (except Japan, which is closed for a holiday).

The Hong Kong and South Korea indices have both jumped almost 1.5% today, while China gained 0.7% and Australia is up 0.3%.

The AFP newswire credits trade war optimism, saying:

The upbeat mood was enhanced by comments from Chinese Vice Premier Liu He that indicated trade talks with Washington were on track.

Liu said he had spoken on Friday to US Trade Representative Robert Lighthizer and Treasury Secretary Steven Mnuchin, with both sides saying the talks were “constructive”.

“Everyone is kind of upbeat around the prospect of at least a partial China-US trade deal,” Peter Dragicevich, a strategist at Suncorp Corporate Services, told Bloomberg TV.

“It’s going to keep equities pretty supported.”

Introduction: Trade optimism lifts markets

Good morning, and welcome to our rolling coverage of the world economy, the financial markets, the eurozone and business.

Stock markets are buoyant this morning, lifted by hopes of a US-China trade deal and growing optimism about the global economy.

Wilbur Ross, the US commerce secretary, has become the latest US official to raise hopes of a breakthrough in the trade war with Beijing this month.

He’s told the Financial Times that he’s “quite optimistic” that remaining sticking points for a ‘Phase One’ trade deal can be resolved soon, adding:

“You won’t have a deal on anything until you have a deal on everything....But we are quite optimistic that the remaining issues for the phase one can be closed out.”

Ross also suggested that licenses allowing U.S. companies to sell to Huawei “will be forthcoming very shortly.” That could help pave the way to a trade war breakthrough.

Investors are also heartened by Friday’s US employment report, which showed that 128,000 new jobs were created in October - more than expected. Last Wednesday’s cut to US interest rates has also given markets a lift.

Stocks have risen in Asia already today, with China’s CSI300 index gaining 0.6%. That means it’s gained a blistering 32% since the start of 2019!

The pan-European Stoxx 600 is on track to hit its highest level since January 2018.

This follows a decent performance last week, which saw Wall Street hit a new all-time high. Jim Reid of Deutsche Bank explains:

It was another positive week for equities with data on balance more positive, trade talks seemingly going in the right direction, a U.K. election finally called and a Fed rate cut.

The S&P 500 advanced +1.5% (+0.97% Friday and a new record high) with semiconductors leading gains, up +2.5% on the week.

But is Europe’s economy turning a corner? The latest survey of Eurozone factories, due this morning, is likely to show that activity remains subdued.

October’s eurozone manufacturing PMI is expected to remain at just 45.7, matching September’s reading, signalling another contraction. At a country level, only France is tipped to rise over the 50-point mark showing growth, while Germany probably had another dire month.

David Madden of CMC Markets explains:

The Spanish, Italian, French, and German manufacturing reports will be posted, and economists are expecting 47.5, 47.5, 50.5, and 41.9 respectively.

The UK factory data, released on Friday, was better than expected (49.6), so we could get a pleasant surprise today.

The UK’s construction PMI survey is due this morning, and expected to show another contraction as Brexit uncertainty lingers.

The agenda

  • 9am GMT: Eurozone manufacturing PMI report for October - expected to remain at 45.7
  • 9.30am GMT: Sentix survey of eurozone investor confidence - expected to rise to -13.8, from -16.8
  • 9.30am GMT: UK construction PMI report for October - expected to rise to 44.1, from 43.3
  • 3pm GMT: US factory orders for September - expected to fall by 0.5%

Updated

 

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