The combination of the UK supply chain crisis and skyrocketing energy costs should weigh on investor confidence today.
The FTSE 100 fell below 7,000 on Friday and is expected to open around 53 points lower this morning to 6,910 – its lowest level since July – as markets also brace for the Bank of England’s move on rates Thursday.
John Roe, head of multi-asset funds at Legal & General Investment Management, told Bloomberg there are many more risks facing the UK. the highest for over nine years.
5 things to start your day
1) Growing fears of a 1970s-style three-day week as Britain’s energy crisis deepens: Soaring electricity prices and a gas storage crisis threaten recovery and leave UK at the mercy of Russian Vladimir Putin
2) The government is planning a gas bailout as a million families face rising energy bill prices: Ministers held talks with energy suppliers as small businesses feared collapse
3) Brussels reflects on OneWeb’s participation to challenge Elon Musk’s Starlink: Potential investment would strengthen UK satellite broadband player’s hand in race to cover Earth with internet signal
4) Roger Bootle: The Merkel era is over, but its economic legacy will continue: Chancellor’s fiscal conservatism has taken a toll on the German economy, but her successors cannot escape her shadow
5) Sterling threatened by stagflation bets: Currency markets brace for turbulent week as central banks make decisions on interest rates
What happened during the night
Shares fell nearly 4% in Hong Kong on Monday in thinned trading during the Asian holiday, with other major markets in Tokyo and Shanghai closed.
Other regional benchmarks also fell after Wall Street ended last week with another drop.
Hong Kong real estate companies and banks lost ground amid lingering concerns about the potential spillover effects of Chinese developer Evergrande’s financial woes.
The company was expected to pay no interest as rating companies predict it could default on its debt. Its shares fell 17% on Monday.
Henderson Land Development fell 12% and New World Development lost 11% amid reports that China would step up oversight of the real estate sector in Hong Kong.
The Hang Seng in Hong Kong lost 3.9% to 23,955.18 and the Australian S & P / ASX 200 lost 2% to 7,254.10. Markets were closed in mainland China, South Korea, Japan, Taiwan and Malaysia.
- Business: Redde Northgate (Commercial update)
- Economy: Rightmove Monthly House Price Index (UK)