China's trade with US slumps; eurozone factories beat forecasts – business live
Latest Chinese trade data show that imports from America have tumbled in 2019, as Donald Trump's tariffs bite
- Eurozone industrial output better than feared
- Chinese-US trade down 11% this year
- Introduction: Chinese exports up 14% in March...
- ...but imports keep falling, down 7%
- Chinese credit growth rises as policymakers act
3.18pm BST
Time for a quick recap.
The latest Chinese trade figures have shown that the trade war with America is hurting demand. US exports to China have plunged by over a quarter this year (when valued in yuan), suggesting that Donald Trump's efforts to cut the US-China trade deficit are still failing.
Markets in Europe have built on last week's strong gains after this morning's Chinese trade data saw exports rise to a five month high.
While some of this jump may well be as a result of a rebound after Chinese New Year, it also suggests that despite concerns about an economic slowdown, that external demand in the global economy, while weaker than a year ago, still remains sufficient to sustain further economic expansion.
3.08pm BST
Newsflash: US consumer confidence has fallen, for the first time in three months.
The University of Michigan's survey of consumer sentiment, just released, dropped to 96.9 for April, down from March's 98.4.
JUST IN: U.S. consumer sentiment fell in April for the first time in three months, missing estimates https://t.co/8RCOaVU2EL pic.twitter.com/UqVndZRMTU
Percent of UMich respondents making unsolicited, positive comments, on government economic policy at 12% in April's preliminary release, down from it's historic post-tax bill high of 35%: {@theterminal chart link: https://t.co/OJTJWH8pcw } pic.twitter.com/teVFHi3tCt
3.00pm BST
The pound is also ending the week quite strongly, on hopes that the Brexit crisis may ease.
Sterling has gained half a cent against the US dollar today, putting it back over $1.31 (where it's been bobbing for some time now).
Talks are going on, constructive, so we're hopeful, positive. But we'll see by the end of next week how far we've got.
Sterling rallying on news of "constructive" Brexit talks between UK political parties.#GBP +0.25% against other currencies#GBPUSD 1.31311 +0.58%#EURGBP 0.86231 +0.02%#GBPAUD 1.82693 -0.31%#GBPJPY 146.993 +0.83%#GBPCAD 1.74884 +0.08%#GBPCHF 1.313 +0.25%
2.48pm BST
Disney and JP Morgan have helped to drive Wall Street higher in early trading.
The S&P 500 has gained 0.5%, with JP Morgan up 4.5% after smashing profit expectations today.
U.S. stocks open higher https://t.co/SEDy2yfA7d pic.twitter.com/WUXbneFYHx
2.38pm BST
Boom! Shares in Walt Disney have hit a record high, as Wall Street hails its new streaming service.
Disney+ will combine many of its major franchises, from Star Wars and Pixar to Marvel and National Geographic. And at $6.99, or $69.99 a year, it will undercut existing players such as Netflix and Amazon Prime. That could help Disney win customers in an increasingly packed marketplace....
Happiest shareholders on Earth?
Walt Disney Co. up 11% to a record ~US$130 after the entertainment giant unveiled its Disney+ streaming service, priced at US$7/month.
Walt Disney shares surge more than 11% at the open, adding 90 points to the Dow Jones Industrial Average and gaining more than $20 billion in market value https://t.co/1tLhAmImNv pic.twitter.com/cPbkRgX0Ol
2.30pm BST
Here's our news story on the sharp fall in US imports into China:
Related: Chinese imports from US slump 28% amid trade standoff
2.26pm BST
Last night, the new head of the World Bank fired a warning shot at China, telling Beijing to come clean about its lending to poor countries.
In his first public appearance as World Bank president, David Malpass said there were already 17 African countries at high risk of debt distress.
Related: World Bank boss calls for more transparent lending to poor nations
2.11pm BST
The European news service EurActiv is reporting that the EU could escalate its trade dispute with America next week.
They say the EU could impose new levies on a19n of US imports, in response to 'unfair' subsidies provided to Boeing.
The EU is considering slapping more than a19bn in fresh tariffs against the US in response to subsidies provided to planemaker Boeing, EU and European officials told EurActiv.
The European commission is expected to send to the member states on Friday (12 April) a list of US products that could be affected by fresh duties. The total value of these exports to the European market is around a19bn.
EXCLUSIVE - EU threatens US with a19 billion of tariffs in response to #Boeing subsidies. https://t.co/0F8bxvy161
1.46pm BST
More from the chancellor....
Chancellor Philip Hammond has told Sky News that business investment in the UK is about half of where it should be in the year but there should be a substantial increase in economic activity once uncertainty caused by Brexit is resolved
.@PhilipHammondUK in #Washington on @lewis_goodall scoop revealing UK gov spent 2bn preparing for no deal: "It would have been irresponsible not to prepare - we prepare for all sorts of outcomes."
1.28pm BST
European banking stocks have been enjoying a good few weeks - a sign that the eurozone economy is turning a corner?
Euro area bank stocks on fire, up more than 10% from the March lows, to a 6-month high. Tiering would help of course - even Weidmann mentions it as if it was a fait accompli - but it can't be just that. The bigger macro picture is finally turning. pic.twitter.com/QFBXw6mu8Z
1.21pm BST
Britain's chancellor of the exchequer, Philip Hammond, has been speaking to reporters attending the IMF's Spring Meeting in Washington.
Hammond (one of the loudest cabinet voices for a soft Brexit), predicted that business investment would recover once the current political uncertainty is resolved. And showing a gift for understatement, the chancellor suggests the UK has 'some work to do' to buff up its international reputation on the world stage....
UK's Hammond: U.S.Treasury And Fed Have Been Very Helpful In Managing Brexit No-Deal Risks
UK's Hammond: UK Will Have Some Work To Do To Restore Its Reputation After Brexit
UK's Hammond: Would Expect Very Substantial Increase In Business Investment Once Brexit Uncertainty Resolved
UK's Hammond: Process For Finding A New BOE Governor Is Getting Underway
UK's Hammond: Our Focus Is To Get A Brexit Deal Through Parliament As Quickly As Possible
- Talks With Labour Have Created A More Constructive Environment For Brexit Talks
UK's Hammond Says No-Deal Brexit No Longer An Immediate Threat But Risk Hasn't Been Removed Altogether
1.10pm BST
JP Morgan has got the latest earnings season off to a solid start, by posting record revenues and profits.
The Wall Street bank achieved adjusted earnings per share of $2.65, beating analysts' forecasts of $2.35.
The US economy continues to grow, employment and wages are going up, inflation is moderate, financial markets are healthy and consumer and business confidence remains strong.
$JPM reports record net income of $9.2B and EPS of $2.65 for 1Q19 on record revenue of $29.9B with ROTCE of 19%
JP Morgan's billionaire CEO can't explain how one of his low-paid employees should budget her salary pic.twitter.com/ucB6xiHv1Z
12.28pm BST
European stock markets are ending the week on the front foot, with gains in most major bourses.
In London, the FTSE 100 is up 30 points, or 0.4%, with mining stocks and banks among the risers.
China's total trade with the US slumped by 11% in the first three months of this year, suggesting that if a US-China trade solution is sealed, it will provide a significant and needed boost to Chinas economy and will be much-need shot in the arm for the global economy.
European futures continuing to rally this afternoon:#FTSE 7448.51 +0.41%#DAX 12014.15 +0.66%#CAC 5509.77 +0.44%#MIB 21883.87 +0.92%#IBEX 9484.5 +0.41%
12.15pm BST
Eurozone factories would have done better in February if Germany hasn't been such a drag.
On an annual basis, eurozone industrial production was 0.3% lower than in February 2018. But in Germany, it fell by a chunky 2% year-on-year.
"While UK industrial production experienced a short-term boost, due to Brexit stockpiling in February, industrial output across the Eurozone fell. As the global economy cools and the US continues to hold its protectionist stance to trade, the outlook for the sector in Europe looks weak....
The slowdown in Chinese growth, continued escalation of trade tensions with the US and nervousness over Brexit are clearly affecting manufacturers' order books.
12.11pm BST
Climate campaigners have also taken out a whole page advert in today's FT in hopes of raising pressure on HSBC pic.twitter.com/2dQjbYmIvV
12.03pm BST
Economists have welcomed today's better-than-feared eurozone production figures (showing a mere 0.2% drop in output in February).
Aila Mihr of Danske Research says it's more encouraging than the PMI reports (which showed factory output shrinking at its fastest rate in over six years)
#Euroarea #industrial #production beats expectations in February, as drag from industry slowly subsides. #PMI has signalled more weakness ahead, but on balance hard data has painted a more optimistic picture of the #economy than survey data lately. pic.twitter.com/qlg5OfGuvj
"Much better than the terrible survey data." @ClausVistesen on #Eurozone #IndustrialProduction, February
Are we about to enter the part of the global "mini" cycle in which the disinflation from slowing Chinese growth is still to hit, but the warm comfort of PBoC easing is starting to flow? It could be a real corker!
11.36am BST
Protesters have estimated that around 100 people gathered outside HSBC's Birmingham offices to take action against what they say is the bank's "complicity in climate change, war and military action".
The groups have vowed to continue campaigning together until HSBC divests fully from the fossil fuel industry and all companies providing military equipment used by Israel and in conflicts across the world.
11.26am BST
HSBC is also holding an AGM today, and taking the opportunity to warn shareholders that the US-China trade war could continue to hurt the global economy this year.
The chairman Mark Tucker says that HSBC hopes that Washington and Beijing can agree a ceasefire (talks have continued between the two side this month, without a deal being reached).
Looking at the current environment, the global economy is much less predictable now than it was a year ago.
Global growth is slowing, largely as a result of weakness in Europe although the economic outlook is also softer in the US and in Asia.
11.16am BST
Over in Spain, the banking giant Santander is facing some criticism over the botched hiring of top banker Andrea Orcel.
Orcel was initially lured from UBS to become Santander's next CEO, only for the offer to be withdrawn, apparently because Orcel demanded compensation for the bonuses he'd leave behind at UBS...
Santander defends the Orcel hiring debacle at its AGM:
Director Bruce Carnegie-Brown says the u-turn on Orcel's hire (for proving too expensive) demonstrates "the strength of the group's corporate governance," showing it works in "best interest" of the bank & shareholders
As a reminder, shareholder advisory firm ISS has urged investors to vote against Carnegie-Brown's re-election over the failed hire.
ISS says the bank suffered reputational damage could face "further economic damages" after dumping Orcel
But some investors are clearly happy with the decision.
One investor has stood up to thank the board for not hiring Orcel, and is happy the UBS banker is not at today's AGM. She says the bank's current leadership is all Santander needs
But a shareholder backlash over the hiring drama wouldn't be a good look for Carnegie-Brown, who is also chairman of insurance market Lloyd's of London (that business is facing it's own scandal - namely allegations of sexual harassment)
10.53am BST
A glimmer of hope shines in Europe's struggling factory sector.
Industrial output across the eurozone fell by 0.2% month-on-month in February, according to Eurostat. That's not too impressive, but it is rather better than the -0.6% expected.
In the euro area in February 2019, compared with January 2019, production of energy fell by 3.0%, both capital goods and durable consumer goods by 0.4% and intermediate goods by 0.1%, while production of non-durable consumer goods rose by 0.9%.
10.37am BST
China's agricultural sector is being hit hard by an outbreak of swine fever which could force Beijing to order a mass cull of pigs.
China could face a major food problem because of a virus that's killing a lot of hogs. Rabobank says Chinese pork production could fall 30% this year. A drop that big would the same as **Europe's entire annual pork supply**https://t.co/Ay6lZFo7wr | @irenegperez pic.twitter.com/UJkUuBpYep
Tomorrow's @Daily_Star front page
- Save our bacon! Butties at risk as China grabs Brit pork
- Dawn Neesom says racist ducks furore is 'quackers'
- #Corrie Amanda is saved by 999 crew #frontpages #tomorrowspaperstoday pic.twitter.com/e8OpuUSt0s
10.15am BST
The pick-up in Chinese credit growth is an encouraging sign for the global economy, says Ralf Preusser, global head of rates research at Merrill Lynch.
We've now had three months of good credit growth figures". that's finally an indication that the policy measures being taken are starting to bite.
That should give us hope in Europe too.
9.50am BST
The latest Chinese money supply figures are also out today, and they show a sharp increase in credit availability as Beijing tried to stimulate growth.
Financial institutions offered 1.69tn yuan of new loans in March, more than the 1.25tn yuan predicted by economists.
#China March new bank loans, credit and M2 all bounced back more strongly than expected. Consistent with PBOC easing and pointing to a pick up in economic growth.
VERY Punchy Chinese credit data. Aggregate Financing 2.9trn (1,9 fcst), New Loans 1.7trn (1.3 fcst)
Most important data just came out. #China is back to stepping on the gas with more credit growth! pic.twitter.com/QOKacpGXG7
WoW China basically threw about 9% of GDP of total social financing at the economy in Q1 2019
TSF rose 1690 in March after a massive Jan+Feb = ~9% of GDP injection in Q21 2019;
M2 rose to 8.6% YoY from 8%; New credit was massive too.
Now u know why Chinese equities rose pic.twitter.com/vDJpqR5zfA
9.24am BST
Digging into the Chinese trade data, you can see that soybean imports have slumped by over 14% this year.
Beijing slapped a 25% tariff on US-grown soybeans last year, in retaliation for president Trump's tariffs on Chinese goods. That has hurt American farmers badly, as Chinese companies turned to rival suppliers such as Brazil.
In Q1, China's imports of major bulk commodities such as crude oil and natural gas grew, while imports of iron ore, coal and soybeans dropped. Imports of soybeans went down 14.4 percent to 16.75 million tons. pic.twitter.com/GTqxRdcKAa
8.59am BST
In another sign of economic weakness, car sales in China fell by 5.2% year-on-year in March.
That's follows a 13.8% slide in February, and means auto demand has been dropping since last summer.
#China's #car sales fell 5.2% in March, marking the 9th straight month of decline in the world's largest auto market. energy vehicle (NEV) sales however, which include #ElectricVehicles, soared by 85.4%... #Reuters #OOTT
8.47am BST
Customs spokesman Li Kuiwen has told a news conference that China expects to see mild growth in imports and exports in the current quarter (April to June), Reuters reports.
8.33am BST
China's total imports have now fallen for four months in a row, points out the Financial Times, a clear sign of economic stress.
Julian Evans-Pritchard, senior China economist for Capital Economics, cautioned that the turnround [in March exports] was more likely a result of the fading effects of the lunar new year holiday, which distorts official data in January and February.
He added that exports were yet to recover from a sharp slowdown at the end of 2018.
8.27am BST
Several experts are concerned by the news that Chinese imports fell again in March, even though the Lunar New Year disruption should have ended.
The tit-for-tat tariffs imposed on US goods will be a factor, of course, but it may also indicate the Chinese domestic economy is struggling.
China exports grew 14.2% in March, but imports shrank *again*, 7.6% fall, shows weak demand in China @scmpeconomy
China exports rose 14.2% YoY in USD terms but imports WORSENED to -7.6% YoY from -5.2% & that is really bad news because it means domestic demand is weak.
Here is the data in time series in a chart. Look at the orange line & look at the acceleration of contraction for imports in March - very bad news for not just China domestic demand but also EXPORTERS TO CHINA (SK, Japan, etc).
In Q1 2019, exports grew 0.9% & imports -4.4% pic.twitter.com/DsgXjK87Y5
#China's exports rebounded sharply in March, rising 14.2% YoY, pointing to resilience in global growth, but imports fell 7.6% YoY suggesting sluggish domestic demand. #mixedbag pic.twitter.com/rwIvyfQolN
8.21am BST
Today's trade data also suggests America is losing the trade war with China.
China's total trade with America has slumped by 11% in the first three months of this year, the Customs department reports.
Reuters: #China customs spokesman says Q1 yuan-denominated exports to #US down 3.7 pct, imports from #US down 28.3 pct
Reuters: #China customs spokesman says March yuan-denominated exports to #US up 10.6 pct, imports from #US down 21 pct y/y
8.04am BST
Good morning, and welcome to our rolling coverage of the world economy, the financial markets, the eurozone and business.
China's economy is under the microscope today as the world's second largest economy reports another fall in imports, and a strong bounce-back in exports.
Reuters: #China March trade data published by Customs, in USD terms
Exports: +14.2 pct y/y (+7.3 pct Reuters poll)
Imports: -7.6 pct y/t (-1.3 pct Reuters poll)
Trade balance (based on raw #s given by Customs): +32.64 bln (+$7.05 bln poll)
China March international trade (exp, prior)
Surplus $32.64b ($7.05b, $4.08b)
Exports +14.2% YY (+7.3%, -20.8%)
Imports -7.6% YY (-1.3%, -5.2%) pic.twitter.com/qf8BM0yFgu