Hong Kong falls into recession; Trump blasts the Fed – business live
Rolling coverage of the latest economic and financial news, as Hong Kong's economy tumbles into recession
- Breaking: Hong Kong in recession
- Hong Kong GDP plunged by 3.2% in last quarter
- Pro-democracy protests hit tourism and spending
Earlier:
- Introduction: Chinese factories suffer another contraction
- US Federal Reserve cut interest rates last night
4.47pm GMT
Finally, the FTSE 100 index had ended a rough day, solidly in the red.
The blue-chip index lost 82 points, or 1.1%, to close at 7,248.
4.30pm GMT
Here's our news story on Hong Kong's slide into recession:
Related: Hong Kong plunges into deep recession
3.01pm GMT
Stocks are falling deeper into the red on Wall Street, following Donald Trump's attack on the Fed.
The Dow has now lost 164 points, or 0.6%, to 27,011, as traders fret about the US-China trade war.
U.S. stocks fall the most in 3 weeks as weak manufacturing data and renewed concern on trade rattled markets https://t.co/zFpY5bxqHz pic.twitter.com/QaarSWpU31
Trump having another pop at the Fed after the latest Chicago PMI
"the Fed puts us at a competitive disadvantage. China is not our problem, the Federal Reserve is! We will win anyway."
2.50pm GMT
Donald Trump has unleashed another attack on America's central bank, a day after it cut interest rates for the third time this year.
The president has repeated some familiar claims -- the Federal Reserve was too quick to raise interest rates in recent years, and too slow to cut them (despite his chivvying).
People are VERY disappointed in Jay Powell and the Federal Reserve. The Fed has called it wrong from the beginning, too fast, too slow. They even tightened in the beginning. Others are running circles around them and laughing all the way to the bank. Dollar & Rates are hurting...
....our manufacturers. We should have lower interest rates than Germany, Japan and all others. We are now, by far, the biggest and strongest Country, but the Fed puts us at a competitive disadvantage. China is not our problem, the Federal Reserve is! We will win anyway.
2.38pm GMT
There's relief for Northern Ireland today -- US aerospace manufacturer Spirit Aerosystems has bought the historic Short Brothers factory from Bombardier, saving thousands of jobs.
Related: Bombardier's Belfast factory sold to Spirit in 850m deal
2.27pm GMT
Ouch! The manufacturing sector in Chicago suffered a dramatic contraction this month.
The Purchasing Managers Index in the Chicago region has tumbled to 43.2 in October from 47.1 in September, a level that suggests output and activity crumbled.
Chicago PMI down to its lowest level since Dec. '15, and Dec. '08 before that. Yikes! pic.twitter.com/DvG9doEUmp
Related: 'Bosses take note': why GM's strike could inspire more collective action
1.52pm GMT
Over in New York, stocks have dipped at the start of trading, despite Donald Trump's attempts to bolster trade deal hopes.
The Dow Jones industrial average has dropped by 62 points, or 0.2%, to 27,124.
#Breaking Facebook shares are up more than 4% as Q3 EPS were $2.12 vs $1.91 forecast .
Average revenue per user: $7.26 vs $7.09 forecast
Prices are indicative only. $NDX $SPX $ES_F $NQ $FB pic.twitter.com/UXvmZEALag
1.27pm GMT
Newsflash: President Trump has just announced that he will sign a 'phase one' trade deal with President Xi soon.
China and the USA are working on selecting a new site for signing of Phase One of Trade Agreement, about 60% of total deal, after APEC in Chile was canceled do to unrelated circumstances. The new location will be announced soon. President Xi and President Trump will do signing!
1.12pm GMT
More GDP data: Canada's economy expanded by 0.1% in August, lifted by a pick-up in manufacturing.
1.09pm GMT
Hong Kong has fallen into recession as its economy contracted for a second straight quarter after more than four months of protests. The once-common lines of shoppers from mainland China outside luxury stores are gone. https://t.co/BRaTe4dRJ8
12.22pm GMT
The protests in Hong Kong began against a bill that would have allowed Hong Kong citizens to be extradited to mainland China, or scores of other countries where there's currently no extradition treaty.
Critics of the bill, which was abandoned last month, feared it could allow any citizen to be arrested and swept out of the City state to face charges.
11.55am GMT
Reuters is reporting that Hong Kong police have fired tear gas to try to break up anti-government protests in the densely populated district of Mong Kok on the Kowloon peninsula today.
Demonstrations were expected on Hong Kong island to coincide with Halloween celebrations.
Organizers are calling on supporters of the protest movement to take part in a "masquerade" that will put to the test a recent government ban on masks at public gatherings aimed at quelling the increasingly violent protests now in their fifth month.
Digital fliers circulated online called on people to wear masks depicting Hong Kong Chief Executive Carrie Lam and Chinese President Xi Jinping and other senior officials.
11.44am GMT
Just in: the protests in Hong Kong have helped to force make-up and fragrance firm Estee Lauder to cut its profit forecasts.
11.06am GMT
Finally, some good news. Italy's economy has returned to growth, with a 0.1% increase in GDP in the last quarter.
#Italy surprises positively! Grew 0.1% in Q3 vs 0% expected. pic.twitter.com/iV5suPPedt
11.03am GMT
Associated Press have written about the impact of Hong Kong's recession on the tourism industry:
Kong's main tourist strip, Ashfaqur Rahman's tailor shop usually is a mainstay for tourists dropping in to peruse neatly stacked rolls of fabric and get measured for custom-made suits.
Not anymore.
10.41am GMT
Tommy Wu, a Hong Kong-based economist with Oxford Economics, says:
"Much of the pressure is now coming from the political unrest.
The trade war itself would cause Hong Kong's GDP growth to slow but not a contraction, while the political unrest could."
10.32am GMT
Hong Kong's economy looks to be in even worse shape than feared, says CNN.
Hong Kong plunged into recession in the third quarter, according to official data released Thursday. The economy shrank 3.2% during the three months to September, compared to the previous quarter.
That's a sharp slowdown from the 0.5% contraction recorded in the second quarter, and much worse than economists had expected.
10.08am GMT
Newsflash: the eurozone grew by 0.2% in the third quarter of this year.
That's stronger than the 0.1% growth expected, but still a weak performance. It matches the 0.2% growth recorded in the April-June quarter.
Euro area #GDP +0.2% in Q3 2019, +1.1% compared with Q3 2018: preliminary flash estimate from #Eurostat https://t.co/lTwvFXO1nb pic.twitter.com/3Q1S4I8eeM
9.58am GMT
Hong Kong fell into recession in Q3. GDP fell by 3.2%, lowering the annual growth rate to -2.9%, the worst since the financial crisis. pic.twitter.com/NKPWSkyz2K
9.56am GMT
Capital Economics has predicted that Hong Kong's economy will continue to shrink in the current quarter, but probably at a slower rate.
It told clients:
"Any recovery will be constrained by weak business investment, however, as the city's political crisis has done lasting damage to its reputation as a stable and autonomous financial hub.
9.38am GMT
In another blow to Hong Kong - and the rest of the global economy - China apparently doesn't believe it can agree a trade deal with Donald Trump.
Bloomberg has the story:
Chinese officials are casting doubts about reaching a comprehensive long-term trade deal with the U.S. even as the two sides get close to signing a "phase one" agreement, Bloomberg News reported.
In private conversations with visitors to Beijing and other interlocutors in recent weeks, Chinese officials have warned they won't budge on the thorniest issues, according to people familiar with the matter. They remain concerned about President Donald Trump's impulsive nature and the risk he may back out of even the limited deal both sides say they want to sign in the coming weeks.
spot where the China trade news crossed pic.twitter.com/ssoQ9UGwoJ
9.28am GMT
Hong Kong's economy has also been hurt by the ongoing trade war between the US and China.
Hong Kong on Thursday confirmed it had plunged into its first recession since the global financial crisis as months of seething pro-democracy protests and the US-China trade war exact a heavy toll on the financial hub.
The semi-autonomous Chinese city has been upended by nearly five months of huge, often violent, pro-democracy demonstrations with little end in sight as Beijing and city leaders adopt a hardline approach.
Hong Kong has slid into a recession for the first time since the global financial crisis in the third quarter, advance estimates show. It's largely due to on-going anti-government protests, and the protracted U.S.-China trade war. #HongKong #recession
9.18am GMT
The Financial Times points out that several economists predict the recession could intensify in the next few quarters:
Iris Pang, an economist at ING, an investment bank, forecast that the economy would shrink in all four quarters next year.
9.09am GMT
Hong Kong's slump into recession has been driven by a sharp slide in retail sales and tourism.
The sight of riot police clashing with demonstrators, tear gassings, and masked protestors throwing petrol bombs has led to a hefty fall in tourist visits.
JUST IN: Hong Kong crashes into a recession as protests hit the economy https://t.co/0j1c4W3FXZ pic.twitter.com/v2H8w4cs0Q
Related: Carrie Lam says she will 'tackle violence head on' as recession hits Hong Kong
9.07am GMT
Hong-Kong based economist Carlos Casanova fears the region's economic problems will drag on into next year:
Hong Kong GDP contract by a whopping -3.2% YOY (-2.9% QOQ) in Q3, down from 0.5% YOY (-0.4% QOQ) in Q2. The economy has officially entered a recession and we are looking at negative growth in 2019. This weakness is likely to continue into 2020. Stay tuned for more.
9.03am GMT
The slump in Hong Kong's economy in the last quarter is much worse than expected, says Bloomberg's Tracy Alloway:
Hong Kong's third quarter GDP comes in *MUCH WORSE* than expected at -2.9% year-on-year versus an estimate of -0.3%. Recession is here. https://t.co/AZVLqubj1l pic.twitter.com/evsuSorVC6
8.51am GMT
Newsflash: Hong Kong has fallen into recession for the first time in a decade, as the ongoing pro-democracy protests hurt the economy.
Hong Kong's economy shrank by 3.2% in the third quarter of 2019, according to new figures from the Census and Statistics Department. That's an extremely sharp contraction, and follows a 0.4% drop in GDP in April-June.
Related: Hong Kong protesters defy ban on masks as they clash with police
Hong Kong has fallen into a technical recession
Real GDP fell by 3.2% in Q3, nearly as much as in Q1 2009 during the financial crisis pic.twitter.com/hAJapgm0OU
8.40am GMT
Oil giant Shell has also been hurt by the global slowdown, and the drop in crude prices.
Royal Dutch Shell has reported a 15% slump in profits for the last quarter amid lower oil market prices and a weaker global economy.
The fossil fuel giant made $4.8bn (3.65bn) in the last three months compared with $5.6bn in the same period last year and warned that it might miss its targets to reduce debt and pay back shareholders...
8.38am GMT
The details of today's PMI reports from China are pretty worrying, says economist Trinh Nguyen.
She points out that orders and employment levels have fallen across manufacturers and service sector companies this month.
Ouch! China manufacturing PMI contracts further to 49.3 from 49.8 and services slowed too to 52.8 from 53.7.
This is very bad news b/c we got rising CPI & deflated PPI & that limits the space for the PBOC to help.
But on the other side, positive for some trade resolution
Details for the state manu PMI is rather grim:
New orders fall, employment in contraction but less, new export orders falling more, imports WORSE, output prices WORSE (we know from PPI falling), inventories reduced (this'll help later when orders rise).
Help needed but how? pic.twitter.com/iMMa6XeNqJ
Details for non-manu (services) PMI:
New orders contracting
Output prices CONTRACTING
EMPLOYMENT flat but contracting
pic.twitter.com/b634WXGmro
8.33am GMT
This latest decline in China's factory activity shows that the trade war is "biting" and hitting exports, says Neil Wilson of Markets.com.
So if negotiations between Beijing and Washington stumble again, it could cause greater economic problems and alarm the markets.
We hearing slightly less optimistic noises on the trade war front. US demands for China to buy set levels of agricultural products are threatening to derail trade negotiations.
China doesn't want to commit to what the US wants and this could prove problematic to finalising the phase one agreement. Crossing the wires now the China foreign ministry has hit back at comments made by US Secretary of State Mike Pompeo, who launched a pretty fiery attack on Communist China in a speech.
8.20am GMT
Chinese factories also reported that they're cutting staffing levels.
#China manufacturers continue to struggle. Factory activity shrank for 6th month in row. Oct PMI fell to 49.3 v. 49.8 in Sep (and worse than est. 49.8). Manufacturers also shed jobs: sub-index for employment at 47.3 in Oct v. 47.0 Sep.
8.17am GMT
Growth across China's service sector companies has also weakened this month, in another worrying sign.
The non-manufacturing PMI, which monitors the health of services firms, dropped to 52.8 from 53.7 in September.
The drop in #China's Non-Manufacturing #PMI is starting to look slightly worrying. Down to 52.8 from as high as 54.9 one year ago. pic.twitter.com/e4kPC8MqF1
China's manufacturing PMI, chart @BloombergTV https://t.co/YOyJSve2UM pic.twitter.com/zV6gMpcPs6
7.48am GMT
Good morning, and welcome to our rolling coverage of the world economy, the financial markets, the eurozone and business.
There are signs of economic weakness in China this morning, and Europe may soon add to the Halloween gloom.
The data was horrible as trade tensions, and a slow recovery in domestic demand continued to weigh on the manufacturing sector.
Related: US Federal Reserve cuts interest rates, sending S&P 500 to record high - as it happened
Early evidence of #Eurozone #GDP #growth in third quarter emerging (preliminary "flash" estimate is out on Thursday). Data out so far show Q3 growth of 0.3% q/q in #France, 0.4% q/q in #Belgium & 0.2% q/q in #Austria. Very real likelihood #Germany saw modest Q3 q/q contraction
Related: Apple reports $64bn in revenue, citing strong wearables and services sales
European Opening Calls:#FTSE 7329 -0.03%#DAX 12922 +0.09%#CAC 5773 +0.12%#MIB 22701 +0.24%#IBEX 9279 -0.06%#STOXX 3621 +0.03%
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