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Eurozone business activity holds near 15-year high


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Good morning.

A series of flash manufacturing surveys for August will offer an early indication today of how global growth is faring in the face of the delta variant, with analysts expecting some slippage, especially in Asia.

In the UK, the pingdemic has already caused a slowdown in services in July,  due to staff shortages and various business disruptions.

Michael Hewson, chief market analyst at CMC Markets UK, said: “It’s quite likely that we’ve seen peak PMI for both France and Germany despite last month’s strong readings from both countries.” He added: “It’s also important to remember that while services [in the UK] have seen a decent rebound in the last few months, certain sectors are still struggling as a result of consumer behaviour which is much more cautious than it would have been pre-pandemic, which suggests we could see another softer reading of 59.1.”

Meanwhile, the FTSE 100 looks set to recover some of last week’s lost ground and open 0.4pc higher, at 7,120.

5 things to start your day 

1) JP Morgan boss schedules first London visit since Covid hit: JP Morgan boss Jamie Dimon is preparing to visit London for the first time since the pandemic hit after snubbing the capital on his last trip to Europe due to UK quarantine rules.

2) Channel 4 battles privatisation with launch of real-time bids for advert space: Channel 4 is to begin rapidly auctioning online advertising across its streaming service as it battles the threat of privatisation.

The Gogglebox broadcaster has created a new platform where firms can automatically bid for ad space around the 14,500 hours of programmes on its All 4 catch-up service.

3) The cracks appearing in Jacinda Ardern’s ‘fortress New Zealand’: Toilet paper shortages. Compulsory masks. A nation enthralled by the movements of a single Covid-19 spreader.

Watching New Zealand’s current news cycle is like taking a step into the past. The country was plunged into a snap lockdown last Tuesday after a single virus case – the first in half a year – was detected in Auckland, the country’s most populous city.

4) PayPal brings its cryptocurrency trading service to the UK: PayPal is to allow users in Britain to buy and sell Bitcoin and other cryptocurrencies, making it among the largest companies to embrace the controversial virtual assets in the UK.

The company’s service will enable customers to choose from four types of cryptocurrency: Bitcoin, Ethereum, Litecoin and Bitcoin Cash, which they will be able to buy, hold and sell from later this week.

5) British biotech launches staunch defence of tobacco takeover of Vectura: A British biotech helping Vectura to develop an inhalable Covid-19 drug is issuing a staunch defence of the company’s £1.1bn takeover by Philip Morris, claiming blocking the deal would leave the tobacco firm “no choice but to continue its bad practices”

What happened overnight 

Asian share markets were trying to pick up the pieces on Monday following last week’s thrashing as coronavirus concerns showed little sign of abating, while safe-haven flows benefited the dollar ahead of a key update on US monetary policy.

Concerns over China’s economy have only intensified in recent weeks, while Beijing’s regulatory crackdown on the tech sector delivered a double blow to markets.

More than $560 billion was wiped from Hong Kong and mainland China exchanges last week as funds fretted on which sectors regulators might target next.

The impact was all too evident in MSCI’s broadest index of Asia-Pacific shares outside Japan which sank 4.8pc last week to a nine-month trough. Early on Monday, it had limped 0.2pc higher but the gains looked fragile.

The rot spread to Japan where the Nikkei shed 3.4pc last week to its lowest since January. Bargain hunting helped the index bounce 1.2pc early on Monday.

Coming up today

  • Corporate: BATM Advanced Communications (Interim)
  • Economics: CBI monthly industrial trends survey (UK); manufacturing, services PMI (UK, EU, US, Asia); existing home sales (US)


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