Week 49

05 December – 09 December

 

05 December

 

The UK’s services sector remained healthy and grew at a faster rate than expected in November, according to a closely-watched survey, but concerns about inflation and political uncertainty led to the first decline in business confidence since July.

 

Indian Prime Minister Narendra Modi’s decision to scrap 86 per cent of his country’s banknotes appears to have swung a hammer to the kneecaps of its services sector, with a closely-watched index of sector activity contracting at a pace equal to the fastest on record in the face of widespread cash shortages.

 

Corporate share buybacks on Wall Street, a major source of demand for US equities since the financial crisis, are expected to set a new record thanks to a boost from the incoming Trump administration’s planned tax overhaul.

 

Four Seasons Health Care, the lossmaking care home operator, has closed or sold 51 homes for the elderly over the past 18 months as it seeks to cut costs ahead of a financial restructuring next year.

 

06 December

 

Mark Carney confirmed on Monday that interest rates were still as likely to move down as up next, following the election of Donald Trump as US president and a more expansionary fiscal stance from the government after the Autumn Statement.

 

The eurozone and the International Monetary Fund are at loggerheads in their attempts to reach a deal that would allow the IMF to join the EU’s €86bn bailout of Greece.

 

Shavkat Mirziyoyev was anointed as the second president in Uzbekistan’s history on Monday following a rubber-stamp election at the weekend that international monitors described as “devoid of genuine competition”.

 

Euronext is set to offer its customers greater choice over where they clear their share trades from early next year after receiving regulatory approval to buy a 20 per cent share of EuroCCP, an equities clearing house.

 

07 December

 

The UK investigation into October’s “flash crash” in sterling has focused heavily on the Japanese trading operations of Citigroup. The value of the pound fell 9 per cent in just 40 seconds and bankers and officials involved in the inquiry say that Citi’s Tokyo desk may have played a key role by firing off repeated sell orders that exacerbated the pound’s fall.

 

The British economy grew by 0.4 per cent in the three months to November, according to an early estimate from the National Institute of Economic and Social Research, in a further sign that growth could be cooling towards the end of the year.

 

Brussels gave the green light for Microsoft’s takeover of LinkedIn, clearing the way for the software giant to close the $26bn deal by the end of the year. “We’ve now obtained all of the regulatory approvals needed to complete the acquisition, and the deal will close in the coming days.” said Microsoft in a blog post.et, a weaker US dollar and as investors turn their attention to a meeting between Opec members later today.

 

Several European companies in China have been unable to remit dividends abroad following the introduction of new exchange controls, the first indication that Chinese attempts to curb capital outflows are causing problems for foreign businesses.

 

08 December

 

US job openings fell modestly in October but were broadly in line with market expectations, while hires were little changed as the labour market continues to approach full employment.

 

As Washington steels itself for the arrival of Donald Trump and a rise in interest rates, China could be forgiven for feeling itself besieged. The country is home to the world’s most leveraged corporate sector, a notoriously volatile property sector and a swath of banks that depend on borrowing on the money markets to fund loans.

 

Bankers working for China’s HNA Group have been buoyed by the successful completion of its $6bn deal for US technology group Ingram Micro — indicating that other pending acquisitions of overseas assets will not be blocked by restrictions on moving capital offshore.

 

A deal to safeguard production at Britain’s biggest steelworks in Port Talbot has been secured with Tata Steel, according to trade unions, including commitments on jobs and £1bn of investment in its wider UK business over the next decade.

 

09 December

 

Annual inflation in Latin America’s second biggest economy hit a near two-year high of 3.3 per cent in November – up from 3.1 per cent in October and, as Capital Economics put it in a note to clients, “it’s unlikely to stop there”, writes Jude Webber in Mexico City.

 

It is a story of the markets against the US Federal Reserve — and so far, the markets have been on the right side of the call. Bond market movements have this year proved a better guide to potential shifts in benchmark rates than has the Fed’s official range of projections.

 

What’s on the IMF radar screen these days? The US dollar, of course. The IMF on Thursday said it was watching the climb in the dollar seen since last month’s US election and working through its potential impact on emerging markets.

 

The chief risk officer of Ratesetter, one of the UK’s top three “peer-to-peer” lenders, has left the company just six months after joining. Cyrille Sallé de Chou joined the startup in June this year from Lloyds Banking Group, where he had managed the credit risk on the bank’s mortgage book. His departure caps a difficult year for the lender, which is backed by star fund manager Neil Woodford, with higher than expected defaults on its 2014 and 2015 loans putting pressure on its provisions.