LIVE: Wall Street rises, FTSE falls as US small business optimism weakens

Live20 updates

• Tue 10 September 2024 at 4:20 pm CEST

  BMW cuts 2024 outlook

  

  BMW (BMW.DE) has trimmed its 2024 profit margin outlook due to sluggish demand in its key Chinese market and issues related to a braking system supplied by Continental.

  The news sent the carmaker’s shares to a near two-year low, down as much as 9%.

  BMW said delivery hold-ups linked to the braking system would have a negative sales effect in the second half of the year, adding more than 1.5 million cars were affected.

  Around 1.2 million of those vehicles have been already delivered to clients and can be remotely checked for faults via over-the-air software, but the remaining 320,000 vehicles cannot be handed over for now.

  The German automaker said it expects its margin on earnings before interest and tax to come in between 6% and 7% for this year, after a previously guided for a figure between 8% and 10%.

  Deliveries are now expected to fall slightly in 2024, while the group had previously forecast a slight increase.

• Tue 10 September 2024 at 3:56 pm CEST

  Apple loses fight against EC order

  Apple (AAPL) lost its fight against an order by EU competition regulators to pay €13bn ($14.4bn/£11bn) in back taxes to Ireland as part of a crackdown against sweetheart deals between EU countries and multinationals.

  The European Commission (EC) issued the order in 2016, saying that the iPhone maker benefited from two Irish tax rulings for over two decades that artificially reduced its tax burden to as low as 0.005% in 2014.

  “The Court of Justice gives final judgment in the matter and confirms the European Commission’s 2016 decision: Ireland granted Apple unlawful aid which Ireland is required to recover,” judges said.

  The Irish government said it would respect the ruling, while Apple said it was disappointed with the decision. The company said: “The European Commission is trying to retroactively change the rules and ignore that, as required by international tax law, our income was already subject to taxes in the US.”

  The ruling is final and cannot be appealed.

  It comes after Apple’s big product launch event this week failed to excite the market on Monday, leaving its share price flat. It announced a new version of the iPhone with a camera button on the side.

• Tue 10 September 2024 at 3:35 pm CEST

  US small business optimism weakens

  Small business optimism in the US has weakened, falling 2.5 points last month to 91.2. This is according to the latest Small Business Optimism Index, calculated by the National Federation of Independent Business (NFIB).

  The fall wipes out July’s gain, and is the 32nd consecutive month below the 50-year average of 98.

  NFIB’s Uncertainty Index rose to its highest level since October 2020, with nearly a quarter of business owners saying inflation was their top small business operating issue.

  NFIB chief economist Bill Dunkelberg said:

  “The mood on Main Street worsened in August, despite last month’s gains.

  “Historically high inflation remains the top issue for owners as sales expectations plummet and cost pressures increase. Uncertainty among small business owners continues to rise as expectations for future business conditions worsen.”

• Tue 10 September 2024 at 3:11 pm CEST

  OPEC cuts forecast for global oil demand

  The Organisation of the Petroleum Exporting Countries (OPEC) has cut its forecast for demand this year, and in 2025.

  In its latest monthly report, it has trimmed its estimate of world oil demand growth in 2024 by 80,000 barrels per day, to around two million barrels per days.

  The cut reflects “actual data received year-to-date”, it said.

  The forecast for world oil demand growth next year has also been lowered by 40,000 barrels to 1.7 million barrels per day.

  #OPEC September oil market report

  oil demand growth in mbpd
  2024 cut by 0.08 to 2.03
  2025 cut by 0.04 to 1.74

  non-OPEC+ supply growth in mbpd
  2023 base raised by 0.07
  2024 unchanged at 1.23
  2025 unchanged at 1.10

  OPEC+ crude production rose by 304kbpd m/m to 40.655mbpd in…

  — Giovanni Staunovo🛢 (@staunovo) September 10, 2024

• Tue 10 September 2024 at 2:46 pm CEST

  Harris-Trump debate: What investors need to look for

  

  As Kamala Harris and Donald Trump face off each other in a debate for the first time in the race for the White House on 5 November, investors will be scouring for clues on policy which could impact their portfolios.

  Nigel Green of DeVere’s said:

  “Investors must be prepared for a Harris victory, which would push clean energy, housing support, and cannabis stocks into the spotlight, or a Trump win, which would benefit sectors like oil, defense, and cryptocurrency.

  “While the US-China relationship has been fraught with tensions in recent years, a Harris administration is expected to take a more measured approach, hopefully avoiding the escalatory rhetoric seen under Trump.

  ​“This could be a positive sign for companies with large Chinese exposure, like Tesla and Apple, as well as chipmakers such as Nvidia and Qualcomm”.

  Harris’ commitment to housing is another area for investors to focus on. Her proposed policies include down-payment support for first-time homebuyers and tax incentives for builders working on affordable housing.

  ​“As such, homebuilders may see a surge in demand under a Harris administration, providing excellent opportunities for growth in the housing sector.”

  Should former President Donald Trump secure victory in the November election, a shift in focus is probable toward traditional energy sectors.

  “Trump’s commitment to rolling back regulations on oil production and exploration would likely benefit companies like Exxon and Chevron.

  “On the other hand, clean energy and EV companies, which have seen a favorable policy environment under the Biden-Harris administration, could face headwinds. Companies in these sectors may experience market volatility if Trump repeals existing tax credits for EV buyers.”

• Tue 10 September 2024 at 2:17 pm CEST

  Targeting inheritance tax, capital gains and national insurance ‘could raise £20bn’

  Making changes to inheritance tax, capital gains tax and employer national insurance in the upcoming autumn budget could help chancellor Rachel Reeves raise more than £20bn, according to new research by think tank Resolution Foundation.

  The government has said it is facing a £22bn “black hole” in public finances, with Reeves hinting that tax rise would be needed to plug this gap. Prime minister Keir Starmer has cited the £22bn figure in the decision to cut winter fuel payments, which has been met with criticism.

  Adam Corlett, principal economist at the Resolution Foundation, said that there is widespread speculation as to what Reeves will announce in her first budget as chancellor on Wednesday 30 October, but pointed out that “tax rises are a dead cert and a time-honoured tradition”.

  Some £10bn of tax rises were included in the Labour manifesto, but Corlett said that “fresh ones will be needed in order for Rachel Reeves to sufficiently fund public services and investment while still hitting her fiscal rules.”

  However, the government has pledged not to raise the main rates of income tax, corporation tax, VAT or national insurance.

  Read the full article here

• Tue 10 September 2024 at 1:50 pm CEST

  Forbes Family Group Gala this Saturday

  This Saturday will see an Gala night in London dedicated to raising awareness of the need for blood donations — specifically in the black community.

  Hosted by the Forbes Family Group (FFG), a not-for-profit foundation dedicated to active capital and small business investments, mentor and career development opportunities for socially disadvantaged and marginalised individuals and the enrichment of disenfranchised communities.

  Their commitment is to provide positive vocations, support initiatives and create opportunities at a grassroots level through charity, not for profit and development programs.

  An organisation dear to their heart is African Caribbean Leukaemia Trust (ACLT) after founders Dean and Danielle’s personal experience as a result of their daughter suffering from Leukaemia at the age of two. ACLT’s work is important as those of African and Caribbean descent are statistically disadvantaged when they are in need of blood, organ or stem cell support.

  This connection compelled them to curate a black tie Gala evening taking place on 1September 2024, to bring together some of the UK’s highest profile entertainers, sports and business people to support ACLT.

• Tue 10 September 2024 at 1:22 pm CEST

  Centamin surges almost a quarter amid takeover

  

  Gold miner Centamin (CEY.L) surged more than 24% after it agreed to be taken over by AngloGold Ashanti (AU) in a $2.5bn (£1.9bn) deal.

  Under the terms of the transaction, Centamin shareholders will receive 0.06983 new AngloGold Ashanti shares and $0.125 in cash. The price represents a premium of around 36.7% to the closing share price on Monday.

  Hochschild Mining (HOC.L) also gained on the back of the news, along with Fresnillo (FRES.L).

  “A takeover of Centamin represents the end of an era for mid and large-cap gold miners on the UK stock market,” said Russ Mould of AJ Bell.

  “Centamin is one of the last pure-play gold producers remaining on the London Stock Exchange. While there are plenty of tiny exploration companies hoping to strike it rich, few have enjoyed Centamin’s level of success and built a large-scale operating mine.

  “It’s surprising we’ve had to wait this long for someone else to make a serious offer for Centamin since Endeavour tried to buy it in 2019. Centamin owns a gigantic gold mine in Egypt called Sukari, which is the company’s jewel in the crow. Sukari is the type of deposit that most gold producers dream of finding but never do. Often it is easier to buy a proven deposit than spend years looking for one.”

  Meanwhile AngloGold Ashanti shares are down 6% in premarket trading.

• Tue 10 September 2024 at 1:04 pm CEST

  Market movers at midday

  Here are some of the market movers at noon…

  • Gold miner Centamin (CEY.L) surged more than 20% after it agreed to be taken over by AngloGold Ashanti (AU) in a £1.9bn deal. Under the terms of the transaction, Centamin shareholders will receive 0.06983 new AngloGold Ashanti shares and $0.125 in cash. The price represents a premium of around 36.7% to the closing share price on Monday.

  • Hochschild Mining (HOC.L) also gained, along with Fresnillo (FRES.L).

  • Wickes (WIX.L) rallied as it posted a drop in interim profit as revenues fell, but backed its profit expectations for the year and said trends were improving.

  • AstraZeneca (AZN.L) slid after mixed results from one of its key lung cancer trials.

  • Alpha Group (ALPH.L) tumbled as it said Morgan Tillbrook had decided to step down as chief executive on 31 December. He will be succeeded by Clive Kahn, who has been chairman since 2016, and who will be appointed as CEO from 1 January 2025.

• Tue 10 September 2024 at 12:29 pm CEST

  Which? calls on Oasis and Ticketmaster to refund fans hit by inflated prices

  Consumer group Which? is calling on Oasis and Ticketmaster to refund fans who were hit by inflated “in demand” ticket prices, as it warns this pricing for the the band’s reunion tour may have breached consumer law.

  Which? is asking the band and the ticketing company to refund the difference to fans who paid more than the expected face value for the tickets.

  A scramble for tickets for next year’s tour on Saturday 31 August sparked anger as fans waited for hours in online queues and were then faced with surging ticket prices under a model used called “dynamic pricing“. This means ticket prices rise along with demand.

  Which? asked fans to send in screenshots of the ticket buying and checkout process to see if they were warned that prices could surge due to high demand.

  In the dozens of screenshots it received, showing both before and after the price increased, none showed a warning message that this would happen.

  Instead, the consumer group said it saw evidence that fans were shown one price for tickets, “only to have that price taken away at the last second and replaced with a far higher, and unexpected, ticket price.”

  Read the full article here

• Tue 10 September 2024 at 12:11 pm CEST

  What does today’s wage data mean for the BoE?

  

  The Bank of England (BoE) keeps a close eye on wage growth, because of its significant impact on inflation, which is currently above the 2% target.

  Richard Carter, head of fixed interest research at Quilter Cheviot, said:

  “Markets have been pricing in a relatively slow pace of cuts for the Bank of England, and the relatively persistent wage growth has been one of the primary reasons.”

  “Though wage growth is coming down, it remains significantly higher than the Bank’s 2% inflation target.

  The BoE’s monetary policy committee (MPC) is due to meet on Thursday 19 September, when it will announce its next interest rate decision. The central bank cut its base rate in August from 5.25% to 5%, which marked the first interest rate cut since March 2020.

  Modupe Adegbembo of Jefferies said:

  “This month’s labour market data showed that wages continue to ease, but at the same time employment jumped by 265,000 — the largest increase in over two years.

  “We think the reliability issues with the Labour Force Survey (LFS) mean the BoE will not place much weight on the bounce in employment, but it should kill any lingering expectations of a September rate cut.

  “We continue to expect the BoE to cut next in November by 25bp, but the labour market showing signs of tightening whilst growth is rebounding makes it very hard to see the BoE delivering anything faster than quarterly cuts, even though some on the MPC may want to.”

• Tue 10 September 2024 at 11:50 am CEST

  Grocery inflation falls to 1.7%

  Grocery inflation has fallen from 1.8% last moth to 1.7% in the four weeks to 1 September, data provider Kantar reported.

  Prices for toilet roll, dog food and bottled cola drinks are among the items whose price is falling, whereas vitamin and mineral supplements, chilled fruit juices and chocolate confectionery increased.

  Kantar revealed that online supermarket Ocado (OCDO.L) was the fastest growing grocer with sales up 12.9% year-on-year in the last month. Tesco’s (TSCO.L) sales rose by 5.3%, while Sainsbury’s (SBRY.L) grew 5.7%.

  However, Asda struggled suffered a 5.6% fall in sales last month.

• Tue 10 September 2024 at 11:33 am CEST

  State pension on track to rise 4%

  Despite UK wage growth slowing, people on the new state pension should be guaranteed an increase of around £460 next year.

  Under the UK’s triple-lock pension pledge, the new state pension should rise by 4%, increasing from £221.20 per week to around £230 per week. This is an increase of almost £9 a week from next April.

  On an annual basis, it would increase the new state pension from £11,502.40 per year to £11,962 per year, an increase of £460 a year.

  The final decision on the state pension will be taken by the secretary of state for work and pensions, Liz Kendall, before October’s budget.

• Tue 10 September 2024 at 11:16 am CEST

  Huawei unveils triple-folding phone

  

  Huawei has unveiled a new smartphone, the world’s first triple-folding phone, just hours after US competitor Apple (AAPL) announced its new iPhone built for AI.

  The Mate XT was officially launched in a keynote presentation by Huawei executive Richard Yu at the company’s headquarters in the southern city of Shenzhen. It goes on sale on 20 September.

  After the Chinese tech giant’s first three-fold mobile phone opened its reservation, in less than 24 hours the number of reservations for the product had exceeded 2 million.

• Tue 10 September 2024 at 10:58 am CEST

  Job vacancies slips to lowest in two years

  The number of job vacancies fell for the 26th consecutive period in the three months to August.

  The total number of vacancies declined by an estimated 447,000 since its peak in March to May 2022.

  Liz McKeown, director of economic statistics at the Office for National Statistics (ONS), said on Tuesday:

  “Vacancies have fallen again, this quarter across every industry. However the total number still remains a little above its pre-pandemic level.”

  There were 857,000 job vacancies in June to August 2024, down 42,000 on the quarter and 143,000 on the year. It is still 61,000 above pre-#COVID levels, though. pic.twitter.com/m6fYlkJA2w

  — Office for National Statistics (ONS) (@ONS) September 10, 2024

• Tue 10 September 2024 at 10:37 am CEST

  Youth unemployment hits three-year high

  

  Youth unemployment has surged to its highest level in three years, official figures also showed on Tuesday.

  The unemployment rate for 18- to 24-year-olds rose to 13.3% in the three months to July, according to the Office for National Statistics. The increase suggests that as the academic year ended, some students were unable to find work.

  The rate was the highest since the three months to January 2021, when Britain was at the height of COVID lockdowns.

  Paul Nowak, TUC general secretary, said:

  “Working people are still facing major problems left behind by the Conservatives.

  “Vacancies have been falling for more than two years. Millions of workers are in insecure jobs and without proper employment rights. And young people’s futures are on the line as youth unemployment rises.

  “Most employers support the new government’s plans to make work pay and strengthen workers’ rights. It’s time to move on from the low-pay, low-rights approach that has failed so many people so badly.”

• Tue 10 September 2024 at 10:22 am CEST

  UK unemployment rate dips

  The ONS also said the rate of unemployment was 4.1% over the three months to July, dropping from 4.2% over the previous three months.

  It came as the number of people classed as economically inactive dropped, but remains near record levels.

  There were 9.298 million people neither in work nor looking for a job in May-July, a drop of 136,000 in the quarter.

  That pulled the inactivity rate down to 21.9%, from 22.2% last month.

• Tue 10 September 2024 at 10:13 am CEST

  UK wages grow at slowest pace in two years

  UK wage growth slowed to its lowest rate in two years in the three months to July, according to data from the Office for National Statistics (ONS).

  Average earnings excluding bonuses slowed to 5.1% in the three months to July, the lowest since April to June 2022, when it stood at 4.7%.

  With inflation taken into account, UK workers saw their pay increase by 3%, down from 3.2 in the previous three months.

  Liz McKeown, director of economic statistics at the Office for National Statistics (ONS), said:

  “Growth in total pay has slowed markedly again as one-off payments made to many public sector workers in June and July last year continue to affect the figures.

  “Basic pay growth also continued to slow, though less sharply. When taken together on a comparable basis, our different measures all show growth in the number of employees over the latest quarter, though annual growth has slowed over the year.

  “Meanwhile, there was a decrease in the number of self-employed people and a fall in both those looking for a job and and not looking for or available to start working.”

  Pay excluding bonuses grew by 5.1% in the year to May to July 2024; including bonuses it was up 4.0%, though this comparison is affected by last year’s NHS and civil service one-off payments.

  Read Labour market overview ➡️ https://t.co/LADdyoefyv pic.twitter.com/So7ERyAv1Q

  — Office for National Statistics (ONS) (@ONS) September 10, 2024

• Tue 10 September 2024 at 9:54 am CEST

  Asia and US stocks

  Asian shares were mixed overnight after a rally on Wall Street that regained some of the losses from the market’s worst week in nearly a year and a half.

  The Nikkei (^N225) slipped almost 0.2% on the day in Japan, while the Hang Seng (^HSI) rose 0.5% in Hong Kong. The Shanghai Composite (000001.SS) was 0.3% up by the end of the session.

  Across the pond on Wall Street, all three major US stock indexes surged 1.2%. The S&P 500 (^GSPC) and the Dow Jones Industrial Average (^DJI) ended a four-day losing streak, bouncing back from their biggest weekly percentage losses since March 2022.

  The Dow rose to reach 40,829.69, the S&P 500 closed at 5,471.07, and the Nasdaq Composite (^IXIC) ended at 16,884.60.

  In the bond market, the yield on benchmark 10-year US Treasury notes rose to 3.70%, from 3.71% late on Friday.

• Tue 10 September 2024 at 9:39 am CEST

  Coming up…

  Good morning, and welcome back to our markets live blog. As usual we will be taking a deep dive into what’s moving markets and happening across the global economy.

  Here’s a quick look at what’s on the agenda for today:

  • 7am: Trading updates: AB Foods

  • 7am: UK labour market statistics, UK unemployment rate

  • 8am: Kantar grocery sales figures

  • 9.30am: Mortgage lending statistics from the FCA

  • 1.55pm: US Redbook index of retail sales