Factory gloom as UK firms cut jobs and US manufacturing shrinks - business live

British manufacturers are cutting employment levels at the fastest pace since 2013, despite a renewed surge in stockpiling

• Latest: WTO slashes trade growth forecasts
• UK factories cut jobs as activity falls
• UK PMI hits 48.3 in September, showing another contraction

Earlier:

• Introduction: House prices fell in September
• Prices barely up over last year
• Big falls in London

7.52pm BST

Finally, here's our news story on the WTO's warning of a trade slowdown.

Related: WTO warns tariff wars threaten jobs and global living standards

5.58pm BST

Stocks have fallen on both sides of the Atlantic after the closely-watched ISM survey of US factories hit its lowest level in a decade.

Is this manufacturing downturn worse than 2015/6? Back then, orders - inventories bottomed in Jun. 2015, leading the pick-up in manufacturing ISM by 6 months. The headline manufacturing ISM now matches the low of Jan. 2016, while orders - inventories just bounced from Aug. low... pic.twitter.com/Z6gxh3crqO

3.39pm BST

The slowdown in world trade forecast by the WTO today shows that life after Brexit won't be easy.

Ursula Johnston, head of customs at law firm, Gowling WLG, explains:

The recent WTO trade forecasts indicate a fairly significant slowdown in the rate of growth of global trade. The UK should consider that when outside the safety net of the EU single market and European customs union, peddling UK goods and services to the rest of the world will not be plain sailing. In particular the UK's exposure to large scale trade conflicts will certainly begin to bite.

3.36pm BST

Here's Ana Nicholls, Industry Director at The Economist Intelligence Unit, in the no-deal Brexit threat to Nissan's Sunderland car plant:

Nissan will have no choice but to review its plans for Sunderland if the UK leaves the EU without a deal. Toyota and others will review their production plans too. About 80% of the Sunderland plant's output is exported and a similar share of components are imported, mostly to and from the EU.

The no-deal Brexit could well disrupt that supply chain; as well as complicating paperwork and logistics, it would also add tariffs of 10% for cars and 4.5% for parts.

3.15pm BST

America's factories are clearly suffering from the trade war, and the slowdown in the eurozone isn't helping either.

US ISM new export orders. No comments needed. pic.twitter.com/DKEbwjiNx9

3.05pm BST

This looks bad - US factory activity had fallen at the fastest rate in a decade, accordingly to the ISM's September health check.

Its US manufacturing PMI has dropped to 47.8, further away from the 50-point mark separating growth from contraction.

Worst number since June of 2009. https://t.co/kALVRT1fRk

2.08pm BST

Time for a quick recap of the main points.

I have since long warned about a mild Swedish recession & my leading GDP indicator is still negative. Today's catastrophic PMI number is more proof. Question is if the historically strong link between Swe man PMI & EUR comp PMI holds - it ain't looking pretty. pic.twitter.com/ZmI1dEb9EB

1.27pm BST

High street bakers Greggs has revealed that its Brexit contingency plans (mentioned earlier) includes changing some of its recipes.

Bloomberg has the details:

If there are any disruptions at ports, "we'll be able to last a few days and then hopefully it will settle down," chief executive Roger Whiteside said on a call with reporters as the company reported a slowdown in sales growth that prompted a fall in the shares.

"Should there be any short-term pressures on some ingredients then there are alternative recipe suggestions we can fall back to."

You know #Brexit is real when.... #Greggs Devises Backup Recipes for Any Brexit Food Shortage https://t.co/r8yxxAGczm

1.21pm BST

Just in: A no-deal Brexit would increase the risk that Japanese carmaker Nissan closes its Sunderland car plant.

The Financial Times is reporting that Nissan will review its decision to build the Qashqai sport utility vehicle at its Sunderland plant if Britain leaves the EU without a deal.

The Japanese carmaker pledged in November 2016 to build the SUV in the UK, safeguarding thousands of jobs, after its then chairman Carlos Ghosn received assurances from the government that its operations would be protected from the impact of Brexit.

But following last year's ousting of Mr Ghosn and a collapse in profits, Nissan has undertaken a global review that makes everything including the Sunderland plant vulnerable to downsizing or closure.

Nissan to review Sunderland production in no-deal Brexit https://t.co/ROnV9AjtAL

1.06pm BST

Here's a handy couple of charts showing how trade growth, and the expanding Chinese economy, have risen hand in hand.

Global Trade as a Percent of Global GDP {@theterminal chart link: https://t.co/9iRMpkWmkh } pic.twitter.com/oLWdu6RpV3

China as a Percent of Global GDP: pic.twitter.com/AAsCYl5EY1

12.54pm BST

There's a major shake-up under way at the John Lewis Partnership.

One in three senior management HQ jobs are being cut, as it effectively merges the running of its supermarkets (Waitrose) and department stores (John Lewis).

Related: Waitrose boss Rob Collins to step down in 100m John Lewis cuts

12.37pm BST

Some good news: Belfast shipyard Harland and Wolff has been saved from closure, by a London-based energy firm.

My colleague Rob Davies explains:

The historic shipyard went into administration in August after its Norwegian parent company collapsed.

But InfraStrata, which works on projects such as the Islandmagee underground gas storage plant off the coast of Country Antrim, said it planned to retain the 79 staff still employed at the yard and potentially employ hundreds more.

Related: Harland and Wolff saved from closure in 6m rescue deal

11.50am BST

The WTO has also provided these charts, which show clearly that trade growth has levelled out since summer 2018 -- when Donald Trump imposed the first tranche of tariffs on China.

11.46am BST

Here are the key points from the WTO's new trade forecasts, which are rather gloomier than three months ago:

11.34am BST

The World Trade Organisation has slashed its forecast for global trade growth to its lowest in a decade, and Brexit is partly to blame.

In a warning sign to businesses, and governments around the globe, the WTO predicted that global merchandise trade will only increase by 1.2% this year, compared with its April estimate of 2.6%.

"The darkening outlook for trade is discouraging but not unexpected. Beyond their direct effects, trade conflicts heighten uncertainty, which is leading some businesses to delay the productivity-enhancing investments that are essential to raising living standards.

"Job creation may also be hampered as firms employ fewer workers to produce goods and services for export."

WTO lowers trade forecast as tensions unsettle global economy #WTOforecast #WTOStats #GlobalTrade https://t.co/301dTFabh6 pic.twitter.com/pgovGPktJM

10.54am BST

10.49am BST

Brexit stockpiling might give factories a short-term boost, but it's not very good for the economy as a whole.

It means that firms are holding onto more raw materials than they'd like, tying up precious capital that could be used more productively elsewhere. It also distracts from longer-term planning.

Some parts of the sector have started to build up inventories again as the 31st October Brexit deadline looms large. The knock-on effect is that this activity is diverting valuable funds away from much-needed investment projects.

To make matters worse, a growing global economic slowdown is increasingly casting a shadow over the sector coupled with reports that some EU-based clients are moving supply chains away from the UK.

Nim's Fruit Crisps bought 24 tons of beetroot in readiness for any disruption around the original March Brexit date. But it didn't happen and they were left paying for refrigeration while they scrambled to process it /2 https://t.co/BVNrWTFBmR pic.twitter.com/oIEYWq6m3A

"We all said we never want to see another beetroot again," says their CEO Nimisha Raja. This time she's not sure whether to stockpile fruit or just risk it. She's holding off on new export contracts too given the risk of swings in the pound /3 https://t.co/BVNrWTFBmR pic.twitter.com/Mi9XjkvImC

10.34am BST

Stephen Cooper, Head of Industrial Manufacturing at KPMG UK, says today's UK manufacturing PMI report is pretty bad.

Firms should check they have enough working capital to ride out the slowdown, he warns, saying;

"We expected grim news from this month's UK Manufacturing PMI readings and that unfortunately came to fruition, albeit with marginal improvement on last month's performance.

"A backdrop of global trade wars, Brexit uncertainty and concerns regarding the slowing global economic growth continue to weigh heavily on the industry, with Europe, our leading trading partner, far from immune. Indeed Europe posted their worst performance since October 2012.

"Short-term Brexit headwinds continue to dominate domestically, but it is clear that weaker international demand and trade wars globally are impacting on growth. The danger remains this causes manufacturers to hold back investment and become myopic losing sight of medium and long-term growth opportunities.

Encouragingly, anecdotal feedback and our own research suggests this isn't happening everywhere, but that doesn't remove the fact resources are being applied to short-term planning to tackle the immediate challenges.

UK manufacturing PMI came in at 48.3 in Sep (indicating output fell), up a touch from Aug's 47.4. Given the Euro Area PMIs this morning this isn't a surprise. Reports of weakening global demand, supply chain diversion & some stock building. Consumer goods did OK in Sep though. pic.twitter.com/8hgs5KmROQ

Still poor news on #UK #manufacturing sector as purchasing managers indicate activity contracted for 5th month in September, albeit at reduced rate. #PMI up to 4-month high of 48.3 in September from 6.5-year low of 47.4 in August. Output, new orders & employment all contracting

10.10am BST

Rob Dobson, Director at IHS Markit, fears that the UK manufacturing sector is sliding into recession.

Here's his take on today's PMI report:

Output, new orders and employment all fell further as rising political, trade and economic uncertainties exacerbated concerns about Brexit.

"The rate of job losses accelerated to a six-and-a- half-year high, highlighting how manufacturers are increasingly seeking to cut costs. Similarly, the investment goods sector was especially hard hit in September, seeing the sharpest drops in production and new business, as clients reined in capital spending while conditions remained volatile.

9.50am BST

Newsflash: UK factories are cutting jobs at the fastest pace in six years, despite getting a boost from Brexit stockpiling.

Data firm Markit reports that output shrank again last month, as the downturn at British manufacturing continues.

Companies reported that capacity had been reduced due to lower demand, efforts to control costs, redundancies and natural wastage. Job losses were widespread across the sector, with declines seen across the consumer, intermediate and investment goods industries and at SMEs and large-sized producers.

Stocks of purchases and input buying volumes also rose for the first time in recent months, as some companies restarted their preparations for Britain to leave the EU.

UK Manufacturing PMI rises slightly (48.3 vs. 47.4), but job losses rise at fastest rate since Feb 2013. Investment goods a particular weak performer as clients remain reluctant to commit to capital expenditure amid heightened uncertainty. More: https://t.co/ZcACbluTsq pic.twitter.com/TJTkI5KAeM

UK Markit/CIPS Manufacturing PMI (Sep) 48.3 vs. Exp. 47.0 (Prev. 47.4); 4-month high

IHS notes: Key findings:

- New orders, output and employment fall further
- Purchasing and input stocks rise as Brexit preparations restart

9.35am BST

The most remarkable story of the morning is that the chief operating officer of Credit Suisse has resigned, over a spying operation against the bank's own outgoing head of wealth management.

Switzerland's second-biggest bank said Pierre-Olivier Boui(C)e has stepped down after private detectives were hired to tail Iqbal Khan, the bank's former head of wealth management.

An investigation into the scandal by the Homburger law firm on behalf of the board cleared Tidjane Thiam, Credit Suisse's chief executive, and found that Boui(C)e alone was responsible for the botched surveillance of Khan, who left in July and later joined arch-rival UBS.

Related: Senior Credit Suisse executive quits over spying scandal

9.23am BST

Ouch! The slump in the eurozone's manufacturing sector has deepened, hit by the US-China trade war and Brexit.

Data firm Markit has reported that factory output and new orders both fell sharply again last month.

Business morale plunges further in Europe in September, measured by manifacturing PMIs:

Germany: down to 41.7 from previous 43.5, more than exp 41.4
Italy: down to 47.8 from previous 48.7, less than exp 48.2
France: down to 50.1 from previous 51.1, less than exp 50.3

Sweden: down to 46.3 from previous 51.8, less than exp 52.0
Norway: down to 50.4 from previous 53.9, less than exp 53.5
Spain: down to 47.7 from previous 48.8, less than exp 48.2

A very gloomy scenario@graemewearden

"The health of the eurozone manufacturing sector went from bad to worse in September, with the PMI survey indicating the steepest downturn for nearly seven years and sending increasingly grim signals for the fourth quarter.....

Businesses also remain downbeat about the year ahead, with optimism around a seven-year low amid trade war worries, signs of slowing global economic growth and geopolitical concerns, including heightened anxiety over a disruptive Brexit.

9.04am BST

High street bakery chain Greggs says it's taking steps to prevent disruption from a no-deal Brexit.

We are preparing for the potential impact of the UK's departure from the European Union by building stocks of key ingredients and equipment that could be affected by disruption to the flow of goods into the UK.

8.51am BST

If people aren't moving house, then they're not buying new carpets and furniture.

Sofas and carpets firm SCS has warned that its sales are down 7.6% in the last two months, partly down to Brexit.

The period has been impacted by the record temperatures seen over the key August bank holiday weekend and the increased political and economic uncertainty that the UK is currently facing.

8.37am BST

Britain's house price slowdown is firmly centred on London, as this map shows:

8.17am BST

Guy Harrington, CEO of property lender Glenhawk, blames Brexit for the slowdown in house price growth:

If these were 'normal' times, we'd expect the favourable underlying drivers of low interest rates and high employment to be supporting a buoyant market.

However these are unprecedented times and the record that is playing housing growth is stuck until the needle bounces over the Brexit bump, although that assumes that's all it is."

"Such low growth means September is set to be the 14th month in a row in which property has lost value in real terms.

"The last time growth even equalled CPI was in July 2018 when both measures were running at 2.5% year on year. The last time the property market was ahead was in April 2018.

"It's a miracle that the market is holding up as well as it is given the level of political turmoil. Low supply and stock levels continue to support prices while cheap mortgages and the strong jobs market are steeling buyers' resolve.

The resilience of the property market looks set to be tested like never before in the final quarter of 2019.

When the extension of Brexit was announced there was a spike in activity in the market, which again reiterates the fact that it is uncertainty holding buyers back rather than a lack of interest. Once activity starts to increase and buyer confidence returns, which it will, prices will start back on an upward trajectory."

8.08am BST

Weak house price growth is obviously good news for those hoping to get onto the housing ladder.

But despite the slowdown, houses are still relatively unaffordable, as this chart shows:

8.02am BST

London's housing market is leading the downturn, with prices sliding by 1.7% year-on-year in the last quarter, Nationwide reports.

Prices in the 'Outer Metropolitan' region also fell, by 1.5%, reflecting the impact of Brexit uncertainty on the capital.

7.50am BST

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

"UK annual house price growth almost ground to a halt in September, at just 0.2%. This marks the tenth month in a row in which annual price growth has been below 1%.

"Indicators of UK economic activity have been fairly volatile in recent quarters, but the underlying pace of growth appears to have slowed as a result of weaker global growth and an intensification of Brexit uncertainty. However, the slowdown has centred on business investment - household spending has been more resilient, supported by steady gains in employment and real earnings.