The FTSE 10 is set to drop by around 0.34pc when it opens today as fallout from Friday’s huge miss on US jobs growth continues to reverberate around global markets.
Goldman Sachs downgraded its economic outlook for the US, pushing down Asian stocks overnight, though Japan’s Nikkei climbed 0.7pc on the back of a better than expected 1.9pc rise in GDP.
Jeffrey Halley, a senior market analyst at trading platform Oanda, said: “The uninspiring Wall Street performance and falling commodity prices are weighing on Asian markets.”
Europe is on track for a weaker open as a result.
Meanwhile Bitcoin plunged 12pc to $46,265 after El Salvador adopted the cryptocurrency as legal tender.
Later we should get more details on how the housing market is performing following the end of the stamp duty holiday for most buyers later this morning, when RICS publishes its monthly survey.
It will follow Halifax data yesterday that showed house prices soared to a record high in the UK in July as more Brits went on the hunt for space after months of working from home.
5 things to start your day
1) City of London faces fresh threat from £600m dividend raid The tax on dividend income will rise from 7.5pc to 8.75pc next April as part of a blitz on savers, workers and businesses aimed at raising £36bn over the next three years to plug a post-pandemic backlog in the NHS and reform social care. It deals a further blow to the Square Mile as London fights against hostility from Brussels and seeks to keep pace with New York.
2) Johnson’s National Insurance raid threatens 130,000 jobs The 1.25pc National Insurance rise – branded as a health and social care levy and greeted with outrage across the political spectrum – breaks a 2019 election manifesto pledge in an effort to slash waiting times as the NHS reels from the fallout after Covid.
3) Ofcom eyes break with Brussels rules to boost broadband firms Ofcom has opened a consultation on relaxing the enforcement of rules which force operators to treat all internet traffic equally, as part of a post-Brexit overhaul of red tape. The watchdog said this could ease demands on Britain’s internet infrastructure as more people use the web to work from home.
4) Two energy suppliers go bust after surge in power prices Almost 94,000 energy customers have been left in limbo after two suppliers went bust in the wake of soaring wholesale power costs, raising questions about the resilience of the industry. PfP Energy – which has around 80,000 domestic customers and 5,000 business customers – is ceasing to trade, as is MoneyPlus Energy, which has around 9,000 domestic customers.
5) Sturgeon drags Scotland to the left with plan for universal income Setting out her policy programme after agreeing a coalition deal with the Green Party, the First Minister confirmed plans to trial a four-day working week, plough an extra £2.5bn into health spending and work to develop a minimum income guarantee.
What happened overnight
Stocks were mixed in Asia on Wednesday after Wall Street closed mostly lower as traders returned from the Labor Day holiday.
Japan’s growth for April-June was revised up to an annual pace of 1.pc from a preliminary estimate of 1.3pc.
Strong trade data from China on Tuesday failed to counter the dampening impact of a weak US jobs report last week.
Japan’s Nikkei 225 index rose 0.5pc to 30,061.71, while the Hang Seng in Hong Kong climbed 0.7pc to 26,533.40 before falling to end the session in the red. The Shanghai Composite index added 0.3pc to 3,688.27. In Seoul, the Kospi lost 0.3pc to 3,178.63. Australia’s S&P/ASX 200 lost 0.3pc to 7,506.30, and benchmarks declined in Taiwan and Singapore.
Coming up today
- Corporate: Dunelm (Full year); Bakkavor, Inspecs, Vietnam Ent Inv, Impact Healthcare (Interim); Biffa, Halfords (Trading update)
- Economics: RICS housing survey (UK)