Hello and welcome to our continued coverage of the global economy, financial markets, euro area and business.
Sentiment among German exporters has taken a hard hit, poll finds. In October, the Ifo Institute’s export expectations index fell to 13.0 points from 20.5 points in September, the lowest value since February. The institute said supply problems with materials used to make German products (such as crisps) are affecting exports.
Expectations have fallen in the electrical and electronics sector, although they remain high, but the mood is darker in the chemical, automotive, textile and leather industries.
South Korean car manufacturer Hyundai missed analysts’ forecasts as the global chip crisis took its toll on car exports. He warned that it would take a long time for chip supplies to return to normal levels.
French automotive supplier Faurecia was also hit by the semiconductor shortage that prompted its customers to cut production and saw sales decline more than 10% in the third quarter.
In China, another real estate developer defaulted, adding to industry concerns caused by Evergrande Group’s debt crisis. Modern earth said it missed a debt payment due to “unexpected liquidity issues” after Fantasia Holdings Group defaulted on a dollar bond maturing in early October.
Evergrande, the second largest real estate developer in China which has a mountain of debt of around $ 305 billion, managed to avoid a costly default last week by accumulating money to pay bond interest at the last minute.
An investor told Reuters developers were defaulting “one by one”.
The question is always, who’s next?
Oil prices remain high after Brent crude hit a three-year high of $ 86.50 a barrel yesterday. Prices have more than doubled from around $ 40 a barrel a year ago due to a sudden surge in post-pandemic energy demand, while supply remains tight. Brent slipped to $ 85.95 a barrel this morning while US crude is at $ 83.63 a barrel, down 0.16%.
Rising crude oil pushed UK oil prices to their highest level ever, dealing a blow to hard-hit households and small businesses. The average daily price per liter hit 142.94 pence on Sunday and could rise further in the coming weeks.
EU energy ministers are holding an emergency meeting in Luxembourg today to discuss their response to soaring energy prices.
On Wall Street, the Dow Jones and the S&P 500 set new all-time highs yesterday, as Tesla first crossed the $ 1 billion valuation, after the American electric car pioneer received an order for 100,000 of its vehicles from rental company Hertz.
Asian markets were mixed with Hong Hong’s Hang Seng index losing 0.76% and China’s CSI 300 dropping 0.36% as the Japanese Nikkei rose nearly 1.8%. European stock markets are expected to open higher today.
- 11am BST: CBI Retail Sales Survey for October (Forecast: 13)
- 2 p.m. BST: US house price index for the month of August
- 3 p.m. BST: US Conference Board Consumer Confidence for October
- 3 p.m. BST: US New Home Sales for September