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European markets hit skids on trade war fears

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European markets hit skids on trade war fears

LONDON: European stock markets dropped today on intensifying concerns about the impact of an all-out global trade war between China and the United States.
US President Donald Trump’s trade policy also faced market scrutiny Thursday after Washington slapped Russia with new sanctions over Moscow’s alleged involvement in a nerve agent attack in Britain.
On currency markets, the ruble extended Wednesday’s losses and is now down more than four percent against the dollar after news of fresh US sanctions on Moscow.
And the pound also remains rooted near one-year lows on fears Britain will leave the European Union next year with no deal to trade with the bloc, with the country’s trade secretary and central bank boss recently warning that the chances of such a scenario are increasing.
“The market is clearly getting more nervous over the possibility of a no-deal Brexit, which would be a messy outcome for the UK economy,” said Rodrigo Catril, senior foreign-exchange strategist at National Australia Bank.
Investors remain anxious about the global impact of a burgeoning US-China trade war between the world’s two largest economic superpowers, and with the US midterm election looming in November.
Beijing said Wednesday it would impose 25 percent tariffs on $16 billion of US goods from August 23, retaliating in kind to a warning from US officials the day before and escalating a crisis that pits the world’s top two economies against each other.
While the row has sent global markets into convulsions this year, the latest development had been widely expected, with Wall Street ending mixed.
“Investors are still wondering how quickly if at all, the tariffs so far will start to affect companies and then economies,” IG analyst Chris Beauchamp told the Media.
“We know the theory, but the actual developments will take time to become clear.”
“It is also not yet clear how far it (the trade war) will all run – until the mid-terms? Or further, until he can really get some key concessions from China,” pondered Beauchamp.
“Market resilience over the past few weeks suggests investors have calmed down for the time being, at least where US equities are concerned.”
Asian stocks however largely brushed off China’s tit-for-tat response, with most markets rising on Thursday.
But in Europe, the mood turned gloomy, as Frankfurt stocks fell 0.2 percent and Paris dropped 0.5 percent in early afternoon deals.
London shed 0.7 percent around midday as the British market was hit also by a number of companies going ex-dividend – meaning the stock’s owners are no longer entitled to the most recently declared dividend.
Added to the picture, the Kremlin on Thursday slammed as “unacceptable” the fresh US sanctions — but said Russia still hopes for constructive relations with Washington.
“I don’t think the Russia move is another front in the (trade) war, however, since Russia is the United States’ 23rd largest partner, and thus not very high on the list,” noted Beauchamp, adding that Trump was likely influenced by fears he was “being too soft on Moscow”.
London – FTSE 100: DOWN 0.7 percent at 7,719.41 points
Frankfurt – DAX 30: DOWN 0.2 percent at 12,610.88
Paris – CAC 40: DOWN 0.5 percent at 5,476.54
EURO STOXX 50: DOWN 0.4 percent at 3,480.90
Tokyo – Nikkei 225: DOWN 0.2 percent at 22,598.39 (close)
Hong Kong – Hang Seng: UP 0.9 percent at 28,607.30 (close)
Shanghai – Composite: UP 1.8 percent at 2,794.38 (close)
New York – Dow Jones: DOWN 0.2 percent at 25,583.75 (close)
Euro/dollar: DOWN at $1.1592 from $1.1610 at 2100 GMT
Pound/dollar: DOWN at $1.2876 from $1.2882
Dollar/yen: UP at 111.12 yen from 110.98 yen
Oil – Brent Crude: UP four cents at $72.32 per barrel
Oil – West Texas Intermediate: DOWN three cents at $66.91

Meanwhile, the world’s biggest temporary staffing agency said today it saw revenue growth last quarter as uncertainty in key European markets helped drive demand for short-term workers.
Economic growth slowed in Europe in the second quarter, but a range of other issues also discouraged firms from hiring permanent staff, said Adecco.
“Between the elections in Italy, Brexit, uncertainty in Catalonia, the strikes in France, there are lots of elements that weren’t favorable to growth,” said firm’s chief executive Alain Dehaze.
“Even if just barely, this lack of clarity had a tendency to push companies to prefer flexible hiring,” he said after the company announced its second-quarter results.
Overall, Adecco’s revenue edged 1 percent higher to 6.1 billion euros ($7.0 billion) in April through June. Net profits fell by 11 percent to 170 million euros as the company stepped up investments to modernize and restructure its operations.
Revenue growth was fastest in Italy, at 11 percent when adjusted for factors like changes in the value of the currencies and the number of working days.
Italy has been gripped by the uncertainty that was aggravated by an election that finally led to a populist government that has already moved to tighten restrictions on firing staff.
In France, Adecco’s largest market, revenues rose by 8 percent for placement of temporary workers, with increases driven by the manufacturing, logistics, and automotive sectors.
France also has labor market rules that make it more difficult to reduce staff numbers when business slows, which employers say to discourage them from taking on permanent employees.
“The impact of the strikes was clearly marked, but it is difficult to quantify in terms of hiring,” said Dehaze.
Meanwhile, in Britain and Ireland, Adecco also saw strong revenue growth of 6 percent thanks in part to winning new contracts. Ireland will feel the largest impact from Britain leaving the EU if London is not able to work out easy access to the single market.
In Spain and Portugal, revenues rose by 5 percent, after having grown strongly in previous quarters due to the recovery of the Spanish economy and uncertainty triggered by Catalonia’s independence drive.
In the United States, where employers are having increased difficulty in finding workers, revenues rose 3 percent, although this represented the best result in three years.
Adecco’s shares fell by 2.6 percent in midday trading while the Swiss SMI index was 0.3 percent lower.

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ECC approves uninterrupted gas supply to export oriented industry

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ECC approves uninterrupted gas supply

ISLAMABAD: Economic Coordination Committee at its meeting here today approved the mechanism for supply of uninterrupted gas to zero-rated export-oriented industry.

The meeting chaired by Finance Minister Asad Umar approved the supply of RLNG to the export industry for three months from December this year to February next month.

According to the mechanism, the export sectors will be provided mix energy including RLNG from March to November.

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German business delegation due on 22nd Oct.

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KARACHI: A thirty-member business delegation from Germany -representing important sectors like energy, engineering, security technology, financial services, and construction- will be on a two-day visit to Karachi, from 22ns October.
This delegation was the result of joint efforts by Bavarian Ministry of Economic Affairs, Energy and Technology; Pakistan Embassy in Berlin with support of Dr. Poetis, who is Honorary Consul General of Pakistan in Munich; the Embassy of Germany in Pakistan and the German Consulate in Karachi, President GPCCI, Qazi Sajid Ali told APP here today.
On the first day, German-Pakistan Chamber of Commerce and Industry has arranged a conference on the trade and investment opportunities in Germany and Pakistan. Sindh Chief Minister Syed Murad Ali Shah is expected to inaugurate this programme.
Then, the delegation would visit Karachi Chamber of Commerce and Industry, Trade Development Authority of Pakistan, Sindh Board of Investment, Pakistan Business Council’s secretariat and the Governor House.
Qazi said that after a long period of time, a business delegation from Germany was coming to Karachi for business discussion with Pakistani counterparts and would finalize the projects of mutual interest for the bilateral business growth. Some of the German businessmen are also interested in the joint ventures. The visit would encourage German investment here and exports of Pakistani goods to Germany.

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Spanish companies’ investments welcomed

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PTV employees degrees to be verified

ISLAMABAD: Minister for Information and Broadcasting Chaudhry Fawad Hussain today said Spanish companies were welcome to invest in the energy, infrastructure and tourism projects in Pakistan.
Speaking at a reception hosted by the Spanish embassy to celebrate the National Day of Spain, he said Pakistan highly valued its friendly and cooperative relations with Spain, bilaterally as well as in the context of European Union.
“Our relationship is based on mutual respect and similarity of perceptions on global issues of mutual concern. The trajectory of Pakistan Spain ties is positive and we are determined to make every effort to maintain it.”
The minister said, “Our mutually beneficial cooperation is strengthened by our shared democratic values, commitment to continued engagement and willingness to help each other. Pakistan looks forward to deepening its partnership with Spain for the achievement of its objectives of peace, prosperity, and development.”
He said Pakistan and Spain closely cooperated on issues of importance, both bilaterally as well as at the multilateral platforms, including the United Nations.
Bilateral trade between the two countries stood at US$ 1.07 billion with Pakistan’s exports of US$ 860 million and imports of US$ 211 million for the period June 2017-March 2018. There is substantial potential for further expansion.
“There is a considerable number of Pakistanis living in Spain and they serve as a bridge between our two friendly countries and positively contribute to the economic development of Spain,” he said adding, “We will have more investment opportunities after the establishment of Special Economic Zones, aimed at promoting regional trade. We have lots of business opportunities with investment-friendly policies. Let us progress together through collective efforts and cooperation.”
Fawad said the government would welcome investment of European Union countries in projects related to CPEC.
He invited people from all friendly countries for a visit to Pakistan for business and tourism. “They will find a much safer Pakistan than it was a few years ago. The situation has improved and will improve further.”
He extended deepest felicitations to the government and people of Spain on their National Day. Spain’s Ambassador to Pakistan Carlos Morales said Pakistan had a rich cultural heritage and he witnessed many changes during his more than three-year stay in the country. The one major change was that Pakistan was now a more safe place, which was a major achievement.
He said Spain wanted to boost relations with Pakistan in the fields of trade and investment. The ambassador said during his stay he tried to enhance people-to-people contacts and bilateral cooperation in the areas of education, culture, and tourism.
Hundreds of Pakistani students were pursuing graduate and postgraduate studies in Spain, he added. Earlier, national anthems of the two countries were played at the event attended by politicians, members of the diplomatic corps and prominent citizens from all walks of life.

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