European markets slip back
Weaker service sector data from around the globe has left stock markets flagging, despite a fairly stable performance from the oil price (Brent crude is currently down just 0.14% at $36.88 a barrel). From China to the US, service sector companies have reported a slowdown, prompting investors to cash in some of their gains from the recent rally. But there was no panic selling unlike earlier in the year, and the movements were fairly restrained. The final scores showed:
- The FTSE 100 finished down 16.6 points or 0.27% at 6130.46 although around 13 points of the fall can be attributed to a number of companies going ex-dividend
- Germany’s Dax dipped 0.25% to 9751.92
- France’s Cac closed down 0.2% at 4416.08
- Italy’s FTSE MIB added 0.78% to 18,348.50
- Spain’s Ibex ended up 0.03% to 8767.0
- In Greece, the Athens market rose 2.91% to 551.36
On Wall Street, the Dow Jones Industrial Average is currently down 60 points or 0.36%.
On that note, we’ll close for the day. Thanks for all your comments and we’re back tomorrow for, among other things, the latest US non-farm payroll numbers.
The US central bank should be patient on raising rates, Dallas Federal Reserve President Robert Kaplan has said.
The economic data out today has shown continuing weakness, calling into doubt the idea of a number of rate rises this year after the Fed lifted the cost of borrowing in December. Reuters reports on Kaplan’s speech today:
Global factors like the drop in stock markets, the decline in the price of oil, and the rise in the dollar since the beginning of the year are acting like a brake on the U.S. economic recovery, similar to the effect of an interest-rate increase, he said.
“While I believe that excessive accommodation carries a cost in terms of distortions and imbalances in hiring, asset allocation and investment decisions, I also believe that, at this juncture, the Fed needs to show patience in decisions to remove accommodation,” Kaplan said in remarks prepared for delivery in Austin.
The Fed raised interest rates in December for the first time in nearly a decade, and at the time policymakers indicated they thought they would like raise rates four more times over the course of the year...
Kaplan said he expects the U.S. economy to be “resilient” this year, with consumer spending buoyed by lower gas prices, among other factors. He forecast about 1.9 percent U.S. GDP growth for this year, enough to push down the unemployment rate, now at 4.9 percent.
But, he added, while monetary policy remains accommodative, it is “somewhat” less so than it was at the beginning of the year “in light of tightening global financial conditions.”
Updated
Back with the weakness in the global economy:
Global economic growth has sunk to the lowest since October 2012 https://t.co/KMjCrx1aYd pic.twitter.com/Jq9e9onras
— Chris Williamson (@WilliamsonChris) March 3, 2016
Here’s BHS:
BHS is threatening to close up to half its shops as the cash-strapped retailer tries to negotiate a reduction in rents with its landlords.
It is understood that BHS has told landlords it wants to close between 50 and 60 shops, and could close another 30 if landlords do not reduce the rents.
The shop closures would put hundreds of jobs at risk if BHS presses ahead with its threat.
An announcement is expected from the company about its plans within days. It is likely that BHS will use a company voluntary arrangement, a type of insolvency proceeding, to close the shops.
The retailer is being advised by KPMG, the accountancy firm, and they have been in discussions with landlords for several weeks about how to cut the retailer’s rent bill.
Full story here:
Updated
BHS threatens to close half its stores
Breaking news on UK retailer BHS:
BHS threatens to close half of stores if landlords dont cut rent. CVA imminent. Story up soon at @guardian
— Graham Ruddick (@GrahamtRuddick) March 3, 2016
And in the search for havens amid the market volatility:
#Germany's 2y Bund Yields hit fresh record low at -0.58% ahead of next weeks ECB meeting. pic.twitter.com/Sm5523gH0z
— Holger Zschaepitz (@Schuldensuehner) March 3, 2016
Meanwhile UK chancellor George Osborne and German finance minister Wolfgang Schäuble have been talking about Brexit at the British Chambers of Commerce annual meeting:
Wolfgang Schauble, who negotiated German reunification, made powerful case not to divide Continent. He “would cry” if UK votes to leave
— George Osborne (@George_Osborne) March 3, 2016
At #BCCConf with German finance minister Wolfgang Schauble discussing #EUReferendum pic.twitter.com/rhLYFUORwT
— George Osborne (@George_Osborne) March 3, 2016
Updated
The day’s US data has been uniformly poor. Connor Campbell at Spreadex said:
Posting its first contraction since October 2013 the Markit services PMI managed to underperform the already low-bar set by the flash reading, coming in at 49.7 against the 49.8 expected; soon after the ISM non-manufacturing figure slipped month-on-month from 53.5 to 53.4 (admittedly, slightly higher than forecast) with factory orders rising back to 1.6% from -2.9% but crucially failing to match the 2.1% expected.
Add onto that the worst jobless claims figure for around 4 weeks and significant miss in the non-farm productivity number, and the Fed was dealt another dovish blow ahead of the central bank’s meeting in a fortnight; we’ll see if the all-important non-farm jobs report adds to that sentiment tomorrow afternoon, with an improvement in the employment change figure (still expected below 200,000) set to be countered by a wage growth tumble. Regardless there was little reason to cheer for the Dow, even with the prospect of no rate hike in the immediate future.
And there are some unwanted records:
Bunch of bad records in US #ISM #SERVICES: New Orders lowest since Mar '14, Prices Paid, since Jul '09, #Emplymnt sub-50 1st since Feb '14
— Ken Odeluga (@Ken_CityIndex) March 3, 2016
Updated
The weak services data shows the US Federal Reserve was too hasty in raising interest rates in December, says David Morrison at Spread Co:
The ISM Non-Manufacturing PMI slipped at touch from last month’s reading while Factory Orders came in shy of the consensus expectation.
This means that both the services and manufacturing sides of the US economy are showing signs of distress. This provides a good reason for the Federal Reserve’s FOMC to row back from its December projection of a full 100 basis points-worth of rate hikes in 2016. However, it also suggests that the Fed’s rate hike at the end of last year is proving to be a big policy error. Nevertheless, investors are unlikely to overreact to today’s data ahead of tomorrow’s all-important Non-Farm Payrolls.
US services slip in February
More confirmation of weakness in the US services sector, and indeed the US economy.
The ISM non-manufacturing index dipped from 53.5 in January to 53.4 last month, although this was slightly higher than the 53.2 figure which had been forecast.
The new orders index at 55.5, down from 56.5, is the lowest since March 2014.
Recent US economic data has suggested the Federal Reserve may struggle to justify raising interest rates again in the near future.
The Markit survey shows a stagnating US economy and there may be worse to come, said the group’s chief economist Chris Williamson:
Business activity stagnated in February as malaise spread from the manufacturing sector to services. The Markit PMIs are signalling a stagnation of the economy in February, suggesting growth has deteriorated further since late last year.
Prices pressures are waning again in line with faltering demand. Average prices charged for goods and services are dropping once again, down for the first time in five months, as firms compete to win new business
Worse may be to come, as inflows of new business have slowed sharply, causing backlogs of work across both sectors to fall at the fastest rate seen since the 2008-9 financial crisis. Such weak demand suggests that business activity and price discounting look set to continue.
However, perhaps the brightest warning light is the downturn in business optimism to the joint-lowest recorded by the survey, suggesting firms are bracing themselves for trouble ahead.
The Markit services PMI is out and contrary to expectations, it has slipped back.
The final reading for February has come in at 49.7, down from the initial reading of 49.8 and January’s figure of 53.2. This is the first contraction since since October 2013.
Wall Street opens lower
US markets have slipped back in early trading, as oil prices edge lower once more.
The Dow Jones Industrial Average has fallen 26 points or 0.16%, while the S&P 500 opened down 0.10% and Nasdaq dipped 0.12%. Brent crude is 0.97% lower at $36.57 a barrel on continuing concerns over a glut of supply and falling demand.
Earlier US weekly jobless claims rose to a higher than expected 278,000 from 272,000 the previous week, and higher than the 271,000 forecast.
Due shortly are the US service sector figures for February. As with manufacturing there are two rival indices, from Markit and ISM. And as with manufacturing, they may not necessarily be in tandem.
Analysts expect the Markit services PMI to edge up from an initial reading of 49.8 for February to 50, but down on the January figure.
The ISM non-manufacturing index is forecast to slip from 53.5p to 53.
Updated
Bill Gross: Finance is burning out like the sun
Influential bond trader Bill Gross has launched a scorching attack on the world’s central bankers for driving interest rates into record low territories.
In his latest note to clients at Janus Capital, Gross warned that the credit growth that has fuelled the economy for so long could soon fizzle out, much as the sun will (eventually) run dry of hydrogen.
Sounding more like a campaigner for financial reform than a Wall Street titan, Gross wrote:
Capitalistic initiative married to an ever expanding supply of available credit has facilitated economic prosperity much like the Sun has been the supply center for energy/ food and life’s sustenance. But now with quantitative easing and negative interest rates, the concept of nurturing credit seems to have morphed into something destructive as opposed to growth enhancing. Our global, credit based economic system appears to be in the process of devolving from a production oriented model to one which recycles finance for the benefit of financiers. Making money on money seems to be the system’s flickering objective.
Our global financed-based economy is becoming increasingly dormant, not because people don’t want to work or technology isn’t producing better things, but because finance itself is burning out like our future Sun.
Gross also took aim at the push into negative interest rates, calling it a “a Zika-like contagion” that has spread from the eurozone to Japan. Stay classy, Bill.
And he even touched on speculation that authorities might even abolish cash, to allow rates to be slashed even lower.
As Gross puts it:
Central bankers seem ever intent on going lower, ignorant in my view of the harm being done to a classical economic model that has driven prosperity – until it reached a negative interest rate dead end and could drive no more. In addition, government policymakers seem to be setting up future roadblocks for savers. There is a somewhat suspicious uniform attack on high denomination bills of global currencies.
Noted economists such as Larry Summers; respected journalists such as the FT’s Gillian Tett, central bankers such as Mario Draghi – all seem suddenly concerned that 500 euro or 10,000 yen Notes are facilitating drug dealers and terrorists (which they are). But what’s an economist/central banker doing opining on law enforcement?
It appears that the one remaining escape hatch for ordinary citizens is being closed. Money in a mattress will heretofore be associated with drugs/terror. The cashless society which appears over the horizon may come sooner than the demise of the penny!
More here: Sunshine, Lollipops and…
Brazilian service sector shocker
It’s a double dose of Brazilian gloom!
Brazil’s private sector contracted at a record pace last month, suggesting that the slump recorded in 2015 extended int0 2016.
Markit’s Brazil Composite Output Index, which tracks companies across the economy, dropped to 39.0 in February, the lowest figure since the survey began in 2007.
That’s the 12th month running that the index has fallen below the 50-point mark that splits expansion from contraction.
Brazilian companies reported that business activity, new orders and employment all fell sharply last month.
Rob Dobson, senior economist at Markit, says the picture in Brazil is pretty grim:
“The Brazilian economic downturn took a real turn for the worse in February, as the financial and political difficulties in the country drove down output and led to reduced order intakes. The domestic market is especially weak and this hit service providers hard, with activity and new business in this sector falling at survey record rates.
The labour market also appears to be in dire straits, as manufacturers and service providers reported further substantial reductions to headcounts.
Back to the UK....and JP Morgan has pushed back its forecast for the first UK interest rate rise, following today’s service sector slowdown.
They now think the Bank of England will leave borrowing costs at record lows for another year, and only hike in the first quarter of 2017.
JPMorgan have pushed back their BoE rate-hike expectation to Q1'17 from Q4'16
— RANsquawk (@RANsquawk) March 3, 2016
Brazil's economy slumped 3.8% last year
Brazil’s economy has suffered its worst 12 months in 25 years.
The country’s economy shrank by 3.8% during 2015, new data show, dragged down by the commodity crunch and a deepening political corruption scandal.
Stats body IBGE also reported that GDP in the final three months of 2015 was 1.8% lower than in the third quarter. That rounded off a pretty brutal year for Brazil, as this chart from the FT shows:
The slump in the prices for iron ore, copper and oil has hurt Brazil’s natural resource companies, forcing them to shed workers.
But the problems in Brazil run much deeper, with the political class engulfed by allegations of wrong-doing.
President Dilma Rousseff is fighting efforts to impeach her over charges that she used money from state-run banks to plug holes in the budget. That case is making it harder for Rousseff to tackle Brazil’s finances, as hefty spending cuts or tax rises could alienate her supporters.
And while growth withers, inflation is running at 11% - despite the central bank keeping interest rates at around 14%.
Updated
In other news, business secretary Sajid Javid has announced that statutory regulators will be forced to take into account the cost of investigations into possible misconduct.
He announced the plan at the British Chambers of Commerce’s annual conference, pitching it as part of a government clampdown on the broader costs of regulation on business.
Javid said the new requirement on regulators would help save £10bn from cutting red tape, in addition to the £10bn saved by the previous government between 2010 and 2015.
But it sounds like an alarming development, especially for financial regulators, who will be under pressure to delay tackling or even ignore claims of misselling.
John Longworth, director general of the BCC, launched a stinging attack on foreign digital businesses that successfully avoid paying corporation tax. He said it was an obligation for companies that earn revenues in the UK to pay tax in the UK.
There’s also a lot of discussion about the EU referendum at the BCC event, including an appearance by German finance minister Wolfgang Schäuble. Our Politics Live operation is covering it all, here:
And here’s some pessimism from Royal Bank of Scotland, who have crunched the manufacturing data released on Tuesday:
Global manufacturing hasn't been this weak since 2012. #China pic.twitter.com/iHjpX3fDuI
— RBS Economics (@RBS_Economics) March 3, 2016
Here’s some optimism from Kallum Pickering, economist at Berenberg Bank, who reckons the threats hitting the UK economy are ‘transitory’:
The real problem for the UK is not fundamentals. In fact, a broad range of indicators point to sustained healthy growth in domestic demand; low unemployment, cheap oil, low interest rates and moderate real wage growth. The real problem is that risks appear to be ‘all or nothing’.
Since Autumn of last year the global economy has delivered a treadmill of threats; China slowdown, EM crisis and the EU migrant problem, to name but a few. And in 2016 they have intensified. First, the financial market rout and overstated fears of a global recession hit confidence in January.
Then, before consumers and businesses could find their feet again, the date of the EU referendum (June 23) was announced, bringing the reality of a Brexit to the fore.
But on the upside, global risks are mostly overstated and are beginning to gradually ease and a Brexit is not our central view. We give a 35% likelihood that the UK votes to leave the EU. In a battle between consistent economic fundamentals and transitory risks (no matter how threatening) the former usually seizes the day, especially in the context of low inflation and dovish central banks.
Today’s service sector report follows disappointing data from the manufacturing sector on Tuesday, which showed growth at a 34-month low.
Construction firms also had a weak February, as this chart shows:
Economists are split over whether the Bank of England will slash interest rates to fresh record lows, in response to these signs of economic slowdown.
Independent economist Shaun Richards reckons at least one policymaker will vote for a cut:
With UK #GDP growth forecasts post #PMI of 0.2%,0.3% &0.4% I think someone at the #BoE will vote to cut Bank Rate #ForwardGuidance
— Shaun Richards (@notayesmansecon) March 3, 2016
Samuel Tombs of Pantheon Macroeconomics reckons the BoE will hold its nerve, though. He points to recent falls in sterling (which should push up inflation and help exporters), and the strong jobs market.
PMIs are only just above levels when MPC has cut rates. But the tight lab. market & weak £ suggest a cut is unlikely pic.twitter.com/6mY7YX9WgC
— Samuel Tombs (@samueltombs) March 3, 2016
The service sector slowdown is a ‘hammer blow’ to Britain’s growth prospects, warns Howard Archer of IHS Global Insight.
He predicts a sharp slowdown in the current quarter, compared with the 0.5% growth recorded in October-December.
We have pencilled in growth of 0.4% quarter-on-quarter in the first quarter, but there look to be downside risks to this – especially as heightened uncertainty over the EU membership referendum could well foster increasing business and consumer caution.
This is uncomfortable news for George Osborne as he readies his March budget.
UK service firms 'to tread water' as fears swirl
The UK service sector makes up around 70% of the economy, so the scale of the slowdown in February is quite worrying.
Jeremy Cook, chief economist at the international payments company, World First, flags up that many firms are too nervous to expand.
“Momentum in services is slowing with everything from Chinese growth concerns, low oil prices, the UK’s referendum on EU membership and global market volatility all increasing the level of uncertainty that businesses are feeling. These doubts have meant that less than 50% of survey respondents expect their businesses to expand in the next 12 months although only 8% expect a contraction; there are simply too many all-encompassing questions that need answering for businesses to feel that they have a solid foundation to grow.
So, for now, expect the engine of UK economic performance to tread water, at best.”
Today’s UK service sector report is much weaker than expected, says financial newswire RANsquawk.
UK Services PMI noticably softer than expected, with survey referencing #Brexit concerns for the first time
— RANsquawk (@RANsquawk) March 3, 2016
Updated
Brexit fears mean British companies have little to be optimistic about right now, according to David Noble of the Chartered Institute of Procurement & Supply.
He warns:
“A maelstrom of sluggish global economic performance and relatively subdued business confidence resulted in a downbeat message in February.
The combined pressures from uncertainties around the EU referendum, China and Middle East crowded out any strong optimism for the future.
Brexit fears hit UK service sector growth
BREAKING: UK service sector growth has hit its weakest level in three years.
Markit’s services sector PMI, which tracks activity at hundreds of British firms, has fallen sharply to 52.7 in February, from 55.6 in January.
That’s the lowest reading since March 2013 (anything over 50 = growth).
UK service providers said they have suffered a big drop in new order growth. Some blamed rising levels of global economic uncertainty, including the EU referendum, China’s slowdown, and the crisis in the Middle East.
Employment growth hit a two-and a half-year low, suggesting bosses are nervous about taking on more staff.
Markit’s Chris Williamson singles out the upcoming vote on Britain’s membership of the European Union.
Survey responses reveal that firms are worried about signs of faltering demand, but boardrooms have also become unsettled by concerns regarding the increased risk of ‘Brexit’, financial market volatility and weak economic growth at home and abroad.
Williamson added that the slowdown puts more pressure on the UK central bank to take fresh action:
The extent of the slowdown will be a shock to policymakers and surely puts to bed any talk of the Bank of England raising interest rates. The focus will instead increasingly shift to whether policymakers may soon need to dig deeper into their toolbox to introduce new measures to shore up the economy with additional stimulus, and what tools might be used.
Updated
Today’s PMI reports confirm that the eurozone recovery has been faltering for a few months now:
CHART: Euro-area #PMI still expansionary but slide continues in February. So far down in all top 4 economies in Q1. pic.twitter.com/bpqXsjZW4t
— Maxime Sbaihi (@MxSba) March 3, 2016
Eurozone private sector growth hits 13-month low
The slowdown across Europe’s private sector has worsened.
Data firm Markit has found that growth decelerated to its weakest rate in 13 months, dragged back by France (not for the first time).
Its monthly PMI report found evidence of “a broad-based slowdown of the eurozone private sector economy”.
Growth slowed in Germany, Italy, Spain and Ireland, while France fell back into contraction for the first time in 13 months.
Firms reported that output growth, and new business, both grew at a slower rate, indicating that demand fell.
And they also cut prices again, adding to the threat of deflation that is stalking the eurozone.
This meant that Markit’s Final Eurozone Composite Output Index dropped to 53.0, down from 53.6 in January.
Chris Williamson, their chief economist, warns that the eurozone’s growth rate may be falling towards stagnation, dragged down by its second largest member.
The survey data raise the prospect of economic growth deteriorating further from the already meagre pace seen late last year, when GDP rose only 0.3%.
“Germany and Italy both reported the smallest expansions for five months, while Spain recorded the worst growth for 14 months. It was France, however, that remained the weakest link, seeing business activity fall for the first time in just over a year.
Updated
The economic chasm between Germany and France has widened, according to today’s purchasing manager reports.
France’s service sector PMI fell to 49.3 in February, showing that activity shrank last month - at the fastest pace in over a year.
Ooops. French final PMI composite revised down to 49.3 in February (prelim: 49.8, January: 50.2). Lowest level since January 2015.
— Maxime Sbaihi (@MxSba) March 3, 2016
But over in Germany, service sector firms kept growing, pushing the PMI further above the 50-point mark showing expansion.
*GERMANY FEB. SERVICES PMI RISES TO 55.3; PRELIM. 55.1
— World First (@World_First) March 3, 2016
Satellite firm Inmarsat is the biggest faller in London this morning.
It warned that trading may be tough this year due to weak government spending; a reminder that fiscal cutbacks have a nasty habit of hitting the private sector.
Whitbread is close behind too, after disappointing the City by only reporting sales growth of 0.5% in the last quarter.
It blamed “lower footfall on the high street and an unusually warm winter”, which apparently meant less demand for hot drinks (?!)
A weak start to trading in London has sent the FTSE 100 down by 17 points to 6129.
Connor Campbell of SpreadEx reckons the weak Chinese data has hit sentiment:
Kicking off the day’s data dump with a whimper was China, Caixin reporting that the country’s economy is ‘weak and unstable’ as the latest PMI slipped to 51.2.
Of course this won’t have helped the markets regain the confidence that was so rampant on the first day of the month, a reminder of the Chinese slowdown the last thing anyone needs to hear when they wake up for a day’s trading.
After five months of contraction, Russia’s service sector has finally returned to growth.
Firms reported that they won new orders at the fastest pace since last July. And that pushed Markit’s Russia Services Business Activity Index up to 50.9, up from January’s 47.1, showing a small expansion.
But Western sanctions and the slump in the oil price are still hurting Russia’s economy, forcing companies to keep shedding staff.
Markit explains:
Faced with a lower level of incomplete work, Russian service sector firms continued to shed jobs. Moreover, workforce numbers have declined in every survey for the past two years. There was some evidence that lower employee numbers were associated with efforts to cut back on costs.
China promises yuan prudence.
China’s vice central bank governor has pledged to maintain a prudent approach to monetary policy this year, rather than shocking the markets with another yuan devaluation.
Reuters has the details:
Yi Gang said the central bank would keep the yuan basically stable against a basket of currencies this year.
#China to keep Yuan stable against a basket of currencies and implement prudent monetary policy in 2016, said Yi Gang, #PBCO deputy governor
— China Economy (@tocchinaeconomy) March 3, 2016
Updated
The weak service sector report comes as thousands of Chinese officials travel to Beijing for the National People’s Congress.
The NPC is a rare chance to hear from China’s top leadership, as they plot their strategy to rebalance the economy towards consumerism.
Bloomberg dubs it “10 days of parliamentary pageantry”, adding that:
This year’s meeting will focus on crafting China’s development plan for the next five years. And the proceedings may provide crucial details on how the government plans to control a slow down in growth while avoiding the dreaded “middle-income trap.”
Updated
Chinese economy 'weak and unstable'
Chinese policymakers have been given a new warning that their economy is weakening.
Growth in the Chinese service sector slowed in February, according to a new report from data provider Caixin.
Chinese service sector firms told Caixin that activity and new orders both grew at a slower rate - meaning they also cut back on job creation.
This follows weak factory data earlier this week, and indicates that activity across the Chinese private sector actually shrank last month.
Here’s the key points from Caixin’s new survey of the Chinese economy.
- Services business activity growth slows as manufacturers report further fall in output
- Composite employment falls at quickest rate in six months, as service sector job creation weakens and manufacturers cut staff numbers sharply
- Input costs increase at the composite level for the first time in a year-and-a-half
And that dragged Caixin’s China General Services Business Activity Index down to 51.2, from January’s six-month high of 52.4. That’s significantly closer to the 50-point mark that shows stagnation.
Add in the weak manufacturing sector, and the ‘composite’ PMI fell to 49.4, showing contraction.
Dr. He Fan, Chief Economist at Caixin Insight Group says it underlines the need for fresh action from Beijing.
The Caixin Composite Output Index for February came in at 49.4, dipping below 50 again, indicating the economy is still weak and unstable.
Overall, the services sector has outperformed manufacturing industries, reflecting continued improvement in the economic structure. While implementing measures to stabilize economic growth, the government needs to push forward reform on the supply side in the services sector to release its potential.”
Introduction: Service sector in focus
Good morning, and welcome to our rolling coverage of the world economy, the financial markets, the eurozone and business.
It’s another big day for economic data, as we look for signs that the world economy is fighting off the risk of a new downturn.
The service sector is in the spotlight today, with surveys from across the globe showing whether activity, exports and hiring picked up or slowed down in February.
That includes:
-
9am GMT: The eurozone
-
9.30am: the UK
- 3pm: the US
Given the size of the services economy, this should show whether fears of a new recession are overblown, or if the recent financial turmoil has hit confidence.
As Michael Hewson of CMC Markets puts it:
While there is no question that the global manufacturing sector continues to find its growth prospects somewhat difficult, the recent rebounds in commodity prices has raised the hope that we could well see a similar rebound in economic activity in the coming months.
In that time, concerns about a ripple out effect to the services sector do appear to have been contained, but there is still a worry that the slowdown in the services sector could last a little bit longer than many expect.
We also get two health checks on the UK housing market, with figures from Nationwide and Halifax building societies.
There’s plenty of corporate results around too. In the UK, we’ll be hearing from hotels-to-coffee chain Whitbread, pizza chain Domino’s and challenger bank Shawbrook, while German sportswear giant Adidas is also releasing numbers.
And we’ll also keep an eye on Spain, where opposition leader Pedro Sánchez failed to be backed by enough MPs to become prime minister. Another vote is scheduled for Friday.
If Sánchez can’t get sufficient backing, then it could be fresh election times in Spain, adding another dose of political risk to Europe....
Updated
