American equity futures climbed on Thursday and European shares fluctuated in the wake of the signing of the U.S.-China trade deal, an event that helped drive global stocks to record highs. Bonds were mixed and the dollar was steady.
Contracts for all three main American gauges pointed to more gains after Wall Street hit records a day earlier. Futures on the Nasdaq 100 did slightly better after tech bellwether
Taiwan Semiconductor Manufacturing Co. projected quarterly revenue well above analysts’ estimates. Morgan Stanley climbed in early trading after results beat expectations. Bank of New York Mellon slipped after matching estimates.
The formal signing of a phase one deal between the world’s two biggest economies has put the trade war on hold as far as many investors are concerned. Assuming the detente lasts, traders will be seeking fresh catalysts, most likely in economic data and the ramp-up of earnings season.
Inflation shocks across eastern Europe have put local central-bank policy front and center for bond and currency traders, even as officials play down the uptick in price growth.
The Czech koruna is the biggest climber among its near neighbors this year and hit a seven-year high on Wednesday as the prospect of a ninth rate hike in little more than two years lured investors. At the other extreme, the Hungarian forint is the worst performer in the period as policy makers cling to a no-change stance. Bond yields have climbed across the region.
Higher-than-forecast inflation prints from Poland, the Czech Republic and Romania in the past week have rattled markets and served up a reminder that risks from a tight labor market haven’t abated. It’s a predicament that contrasts with the euro area, where the European Central Bank is struggling to rekindle price growth.
Given eastern Europe’s trade links with the euro region, some policy makers are looking past spikes in inflation and maintaining loose monetary policy. Investors aren’t fully on board, however.
For the first half of its financial year ending November 30, 2019, Knutsford Express (KEX) reported net profit of $79.08Mn, which represents a 36.2% contraction when compared to $124.00Mn earned during the same period one year prior.
The outturn was due to a 24.8% (or $104.44Mn) increase in administrative and general expenses that outpaced the 9.4% (or $52.08Mn) growth in revenue.
Management attributed the increase in expenses for the second quarter to its new advertising campaign, additional staffing and toll costs associated with new routes.
The stock has declined by 5.5% since the beginning of the year and currently trades at a P/E of 40.0x earnings which is above the Junior Market average of 24.8x earnings.
Net profit dipped 9.8% for the first three months ended November 2019 ending the period at $14.82Mn (EPS: $0.03), $1.57Mn lower than the corresponding period in 2018.
A decline of 10.4% (or $22.32Mn) in revenue coupled with a $10.5% (or $3.14Mn) increase in expenses were the primary drivers of the dip in the net profit. In particular, administrative (up 14.2% or $2.86) and financial (+72.1% or $985.46K) were the main forces behind the upward movement in total expenses.
The stock has declined 1.4% since the start of the year, and closed trading at $2.08 on Tuesday. The stock currently trades at a P/E of 17.3x earnings which is below the Junior Market Manufacturing average of 21.4x earnings.
Strong remittance-fueled private consumption and muscular investment growth will drive real GDP growth in Guatemala over the coming quarters.
However, heightened political risks, including popular resistance to Guatemala’s asylum agreement with the US and a violent backlash to President Alejandro Giammattei’s anti-crime crackdown, pose downside risks to economic activity.
Fitch has revised up its real GDP growth forecast for 2020 from 3.3% y-o-y to 3.8%, due to the strong trend in remittance inflows and investment activity in recent months. This compares to estimate of 3.7% growth in 2019.
The expectation is that Ecuador’s current account deficit will expand to 1.6% and 1.8% of GDP in 2020 and 2021, as a rebound in private consumption drives import growth.
Net investment outflows will continue to put pressure on Ecuador’s foreign reserves.
Ecuador will remain dependent on the IMF to finance its current account and trade deficits, though we expect a renegotiation of the terms of the programme.
President Donald Trump is poised to sign a deal with China on Wednesday that leaves significant tariffs in place and for the first time would punish Beijing if it fails to deliver on pledges related to its currency, intellectual property and the trade balance.
But the question set to dog Trump the moment the ink dries is whether the pact will rewire the relationship between the world’s biggest economies. For many in Washington, U.S.-China economic ties have become an example of the evils of globalization, the tensions of 21st century technology and geopolitics, and the missteps of past presidents.
The “phase one” deal that Trump recently called a “big, beautiful monster” is by no means a standard trade agreement: At 86 pages, it’s thinner than most on substance and commitments. The U.S. agreed to halve 15% duties on $120 billion of imports and delay others in return for Chinese promises to make structural reforms and purchase an additional $200 billion in American goods and services over the next two years. The full text will be released Wednesday.
The U.K. is about to ask how quickly it should fix one of its most controversial pieces of economic data, a measure of prices riddled with problems.
Chancellor of the Exchequer Sajid Javid will start a consultation in March on fixing the retail-prices index. That follows a decision last year to correct the flawed gauge by 2030, or possibly as early as 2025 based on the result of feedback.
The move will be another step in a long-running saga about a flawed statistic that’s used for the 453 billion-pound ($590 billion) inflation-linked gilt market, as well as setting increases for student loans and rail fares. With RPI 80 basis points higher, on average, than consumer-prices index, that means higher costs for rail commuters, while the state has to pay more to holders of linkers.
Preliminary data from the Jamaica Tourist Board (JTB) indicates that cruise passengers accounted for over 1.5Mn of the approximately 4.3Mn tourists visiting the island in 2019.
This was disclosed by Tourism Minister, Hon. Edmund Bartlett, who spoke with JIS News following last Friday’s (January 10) arrival of one of the Norwegian Cruise Line’s (NCL) flagship vessels – the ‘Norwegian Bliss’ – which made its maiden voyage to Jamaica, docking at the Ocho Rios Port.
The Minister headed dignitaries and officials welcoming the ship’s crew and 5,700 passengers, who each received a complimentary cup of the globally renowned Jamaica Blue Mountain Coffee.
Mexico went to the euro-denominated market on Monday for its second bond sale of the year, raising €1.75 billion ($1.95 billion) in a two-part deal that was 3.8 times oversubscribed
The ministry said it sold €1.25 billion in new 2030 notes with a coupon of 1.125%, a record low in euros, and added €500 million to its 2.375% 2039 notes. The 10-year notes priced at 99.468 to yield 1.241%, while the 2039 retap priced at 107.873 to yield 2%.
Mexico opened the initial price talk on the new 10-year bonds at 125 basis points to 130 basis points over mid-swaps and launched at 110 basis points to 115 basis points. It also started the 2039 retap at a yield of 2.15% to 2.2% and launched the deal at 2% to 2.05%.
