Summary for the 17th of January 2019


The Labour party didn’t win the majority of the vote for its proposal of no confidence vote against the British prime minister, Theresa May and her government. The proposal got 306 votes for and 325 against. This is the second time May won a vote of no confidence proposal. The first time was in December and yesterday was the second time. She has now until Monday to present a plan B for a Brexit deal to the British parliament.

She gives the indications after Tuesday night that she is going to cooperate with the other parties in the parliament. Many signs point to a postpone of a Brexit deal. The EU indicated yesterday that it would accept a postpone of Brexit deal as far as 2020.

The British pound (GBP) has risen in value lately due to the majority in the British parliament shows signs of wanting to avoid a hard exit and May’s comment of cooperation with the other parties in the parliament.

British consumer price index (CPI) has been trending downward lately because of the effect of a weak GBP has decreased. The CPI fell in December to 2.1%, year over year. Core CPI (ex. food and energy) rises from 1.8% to 1.9% year over year in December.

The U.S’s government shutdown is now in its 26th day, the longest recorded U.S government shutdown. This is having a consequence on the economy, and the White House has projected a negative 0.13% effect each week on the economy. Another consequence will be that President Trump will postpone his state of the union speech on 29th of January.

NAHB’s Housing Market Index in the U.S shows a rise to 58 from 56. The index fell sharply in the last two months from 68 in October to 56 in December. The fall in the U.S 10 years treasury bond yield leads to many borrowers able to refinance their mortgages, which is good for the housing market.

Fed’s Beige book, released yesterday shows that the activity in the U.S economy is still modest to moderate, though the energy and the industrial sectors seem to be slowing in activity.  Also it shows that the labour market is still tightening and the wages are rising, but inflation is still moderate.

Wall Street rises (16th of January) after the financial sector released a better than expected earnings report.

The U.S is accusing Huawei of industrial espionage where Huawei is being accused of stealing business secrets from American companies. This might effect the trade negotiation between the U.S and China.

Indices on 16th of January:

Dow: +0.6%
S&P 500 and Nasdaq: +0.2%
Nikkei: -0.3%
Chinese indices: +0.3%.

If you are looking for a course in finance, check out my video course in Portfolio Analysis:

Quick and Easy Portfolio Analysis Video Course

and Facebook page for other information:

Quick&Easy Finance

Comments

Post a Comment

Popular posts from this blog

Summary for the 2nd of October -Weaker manufacturing outlook

Last week’s flash PMI estimates for the EU area and yesterday’ final PMI numbers are indicating that the weakening in the manufacturing sector isn’t country specific, but rather the weakening is across countries. The decline in Germany’s manufacturing sector is less than expected by the financial markets, while the decline in France is higher than expected. The same goes for Spain and Italy. The UK’s PMI index has increased by 0.9 to 48.3 and is more than expected, though 48.3 still indicates a weaker outlook. The US Manufacturing PMI has increased to 51.1 while the ISM index declines by 1.3 percent to 47.8, the lowest value since 2009. Despite weakening activities in the manufacturing sector for the developed countries, for the developing countries the outlook is still positive. The global PMI value in the manufacturing sector has risen from August to September. Past months’ decline has been due to weaker growth in the global trade. The WTO has updated its global trade forecast
Read more

Summary for the 15th of October

China’s balance of trade shows a fall in exports by 3.2 percent, comparing to a year ago and the imports fall by 8.5 percent, the first fall since May this year. China is the largest contributor to world economic growth, through the weaker imports, China’s economic decline is affecting the rest of the world economy, such as the Euro area. The Euro area’s industrial production for  August has risen by a little more than the markets have expected. The industrial production in the Euro area has been weakening since the start of 2018. Finland is currently holding the council of the EU presidency. At a press conference with the European Council President elect, Charles Michel, the Finnish prime minister, Antti Rinne, says that The EU needs more time to reach a Brexit agreement. Boris Johnson is hoping to seal a Brexit deal before the EU summit on Thursday, so that he will be able to present it to the British Parliament on Saturday for approval, in doing so, he won’t need to postpone B
Read more

Summary for the 21st of October Brexit drama

On Saturday, the British parliament is withholding the final decision of the revised Brexit deal and forcing Boris Johnson to ask the European Council for an extension to the 31 st of January. Instead the parliament has greed on Oliver Letwin’ amendment, which states that there wont be a no deal Brexit until the parliament has agreed on the revised Brexit deal this week. And on Saturday night, Boris Johnson has sent an unsigned letter to the European Council asking for a Brexit delay as well as a personal letter to the Council asking the EU leaders not to delay Brexit. The US stock exchange has closed in negative on Friday after Johnson & Johnson has to recall 33 000 bottles of baby powder in the US after health regulators found trace amounts of asbestos in a bottle purchased online. Boeing has admitted that two of its employers in 2016 misled the FAA about the 737 Max and its technical system. Weaker than expected Chinese economic indicators also contributes to the negative
Read more