This chart exhibits that Hong Kong’s overall economy has shrunk more quickly than in the international economic crisis of 2008, or after the Asia economic crisis a 10 years before:
Worst Hong Kong downturn on file
Here’s Bloomberg’s get on Hong Kong’s dire advancement figures:
Hong Kong’s downturn is now the worst on file, extending the initial economic downturn witnessed in a 10 years as the coronavirus outbreak additional battered an overall economy by now weakened by political unrest.
The city’s overall economy contracted eight.nine% in the initial quarter from year-back amounts, according to advance govt knowledge. The drop surpasses the prior file of -eight.3% in the 3rd quarter of 1998 and a 7.eight% contraction in the initial quarter of 2009, the two worst quarterly readings in knowledge again to 1974, according to the Census and Statistics Section Hong Kong.
The latest drop also marks the 3rd straight quarterly contraction for Hong Kong, the longest such stretch because the aftermath of the international economic crisis in 2009.
Hong Kong seems to have endured its worst financial slump on file:
Hong Kong’s overall economy shrinks again
Newsflash: Hong Kong’s economic downturn has deepened as the Covid-19 pandemic hits its overall economy.
Hong Kong’s GDP shrank by 5.3% in the initial quarter of 2020, official figures clearly show. That is a incredibly sharp contraction, extending its financial downturn.
On an yearly foundation, the City state’s overall economy is now eight.nine% smaller sized than a year back – owing to coronavirus shutdowns, final year’s pro-democracy protests, and the US-China trade war (which may perhaps be flaring up again…)
In a assertion, Hong Kong’s govt reported the pandemic experienced induced a “severe contraction” in international overall economy action. It now fears the overall economy will shrink by 7% this year, and predicted that exports will continue being beneath “notable pressure” in the near time period.
Eurozone production overall economy contracts at file pace in April
France, Germany and the Netherland’s production sectors also slumped final thirty day period, according to Markit’s new survey of buying supervisors.
They ensure the information from the ‘flash’ PMIs two weeks back – action contracted in April even more quickly than after the economic crisis:
This has dragged the final Eurozone Manufacturing PMI down to 33.4, slightly even worse than the flash looking through of 33.6– demonstrating an extremely steep contraction (a looking through of 50 would clearly show action was flat).
Ouch. Spain’s factory sector has endured an ‘unprecedented’ slump final thirty day period.
Output, new orders and buying action all fell at a file pace final thirty day period, according the latest Spanish production PMI survey.
Organizations terribly afflicted by the Covid-19 pandemic are top the fallers on the London stock industry now.
Vacation corporations are possessing a negative morning, with Intercontinental Hotels are down 6.5%, cruise operator Carnival down 65% and spending plan airline easyJet down 5%.
Jet motor maker Rolls-Royce are down 6.6%. That displays soaring issues in excess of the airline market, after billionaire investor Warren Buffett exposed he’s bought all his share in America’s four largest US airways.
Best risers this morning include on the web grocer Ocado (+3.6%) and takeaway chain Just Try to eat (+two.one%), who are both of those in need throughout the lockdown.
China’s World Times, the state-managed tabloid, has hit again at Washington’s promises in an editorial now.
It accuses US Secretary of Point out Mike Pompeo of “bluffing” and hoping to “fool” the American community, by saying that COVID-19 originated in a laboratory in Wuhan. Additional below.
European markets fall in early investing
European stock markets have opened in the crimson, as traders answer to the latest US criticism of China.
The Europe-broad Stoxx 600 index has dropped by two.6%, with France’s CAC and Germany’s DAX both of those shedding 3%.
Buyers are scrambling to promote shares possessing been on getaway final Friday (when the danger of a new US-China trade war emerged).
In London, the FTSE one hundred has dipped by forty factors, or .7%, to 5722. That is an 8-day minimal, meaning final week’s brisk rally has been wiped out.
The Covid-19 pandemic has experienced a devastating impact on factory output across Asia, new knowledge exhibits.
Data organization Markit has documented that production action in India, Taiwan and South Korea slumped alarmingly final thirty day period, as the planet overall economy lurched into economic downturn:
Worries about the international overall economy are weighing on the oil rate this morning.
US crude has dropped by 6% to $18.sixty for each barrel, even though Brent crude is one% decreased at $26.19.
The Trump administration is “turbocharging” an initiative to eliminate international industrial supply chains from China, according to Reuters this morning.
They cite “officials common with U.S. planning”, who say Washington wants US companies to go their supply chains away from China.
Here’s a flavour:
“We’ve been operating on [lessening the reliance of our supply chains in China] in excess of the final handful of a long time but we are now turbo-charging that initiative,” Keith Krach, undersecretary for Financial Expansion, Energy and the Atmosphere at the U.S. Point out Section advised Reuters.
“I believe it is essential to understand wherever the essential places are and wherever essential bottlenecks exist,” Krach reported, incorporating that the issue was vital to U.S. stability and a person the govt could announce new action on shortly.
The danger of a new US-China trade war has knocked Asia-Pacific markets.
Hong Kong’s Hold Seng index slumped by practically 4%, after Donald Trump declared that new tariffs would be the ‘ultimate punishment’ for China.
South Korea’s Kospi two hundred drop 3% and India’s Sensex is down 5% (mainland China and Japan are both of those shut).
Jim Reid of Deutsche Lender states the Covid-19 ‘blame game’ is worrying the markets:
Presented it’s a US election year this difficulty isn’t likely to go away, especially as Joe Biden has prompt that Mr Trump is weak on China. Nevertheless, on Thursday night time and Friday it became a more fast topic as the Washington Post documented that the US experienced held preliminary discussions to punish China for its job in the virus outbreak that bundled the possibility of the US cancelling its debt obligations with China.
There was an fast denial from Larry Kudlow who verified that the full faith and credit history of US debt obligations is ‘sacrosanct’. Nonetheless, the possibility of a chilly war amongst the two nations looks to be developing.
Introduction: Buyers jittery as Trump blames China again
Very good morning, and welcome to our rolling protection of the planet overall economy, the economic markets, the eurozone and business enterprise.
Buyers are jittery now after the White Household intensified its criticism of China in excess of the Covid-19 pandemic, fuelling fears of a new breakdown in relations amongst the two powers.
Overnight, Donald Trump recurring his claim that the virus emerged from the Wuhan Institute of Virology (a little something previously denied by China) and that Beijing couldn’t “put out the fire”.
He advised Fox News:
“I believe they manufactured a awful mistake and they did not want to acknowledge it…
“My feeling is they manufactured a mistake. They experimented with to include it, they experimented with to set it out. It’s like a fire.
Trump also prompt that new tariffs on China could be the ‘ultimate punishment for Beijing, as a penalty for bungling the coronavirus outbreak.
Hrs before, US secretary of state, Mike Pompeo, reported there was “enormous evidence” the coronavirus outbreak originated in the laboratory — devoid of giving the evidence to again up the claim.
China looks likely to be a vital difficulty in the US presidential election – especially as the president can not boast about the soaring stock industry or the strongest overall economy in background.
Stephen Innes, main international markets strategist at AxiCorp, writes:
The US media is pointing to the rising possibility that China will be the focal place of the 2020 election campaign. Polls performed by President Trump’s campaign propose that China will be an ongoing difficulty, according to Republican sources cited by Politico.
The Democrats are analyzing a harder line on China to increase their prospects. Either way, China will be in the US spotlight and not in a pleasant way.
Fears of a new US-China trade war are overshadowing hopes that the international overall economy could tiptoe its way in the direction of more regular situations in the coming weeks.
Britain’s FTSE one hundred is predicted to fall by forty factors, or in excess of .5%, incorporating to Thursday and Friday’s losses. There will be deeper sharper losses in continental Europe, wherever traders are actively playing capture-up after Friday’s May Day holiday seasons.
Most nations have continues to report a slowdown in new scenarios and fatalities from Covid-19 – with the international loss of life toll now standing at in excess of 247,000. Italy is commencing to raise its lockdown now, but there is community disappointment and anger that vacation is still limited and some stores are not authorized to open.
- 9am BST: Eurozone production PMI for April: likely to ensure the worst downturn on file
- nine.30am BST: Hong Kong GDP for Q1 2020: likely to clearly show a further contraction
- 3pm BST: US factory orders: predicted to slide all over 10%