There was a sour mood in the air yesterday as global stock markets experienced mass turbulence due to growing concerns surrounding a US recession.
Key Wall Street stocks the Nasdaq Composite, S&P 500 and the Dow Jones, lost 6.2%, 4.2% and 2.8% respectively, while London stock, the FTSE 100 posted its biggest one-day drop in almost seven months.
The pound fell to a two-month low against the euro and a one-month low against the US dollar, despite slowing US labour demand, prompting expectations of the Federal Reserve’s bulk rate cuts.
Despite upbeat ISM services PMI data and a risk-averse market atmosphere, the US dollar is struggling to find demand and the euro took advantage of this, rising to a fresh seven-month high against the US dollar.
New accounts from HMRC revealed that billions of pounds in taxpayer money have been lost due to error and fraud in tax schemes designed to encourage research and development in business. Since the introduction of the schemes in 2020, £4.1 billion has been squandered.
Yesterday, the UK car industry downgraded its forecast for electric vehicle (EV) sales in 2024, despite the number of battery EVs sold in the UK rising by 18.8% in July on the figure a year ago. The lobby group expects sales to grow more slowly than initially anticipated for the rest of the year.
This morning S&P Global brings UK construction PMI results, which are expected to rebound to 52.4 in July, from 52.2 a month prior.
This afternoon remains relatively quiet on the data front with only Canada’s balance of trade due after lunch. Investors forecast a trade deficit of two billion Canadian dollars.
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