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Investment Market Update

Early trading

UK stocks are expected to open lower upon worries that the US Federal Reserve may be ready to raise interest rates sooner than expected.

Asia – Asian stocks and bonds fell sharply, while commodities slumped amid concern that Central Banks in the world’s biggest economies are questioning the benefits of loose monetary policy.

US – US stocks fell the most since June, with the Dow Jones Industrial Average declining more than 2% after a Federal Reserve official signalled more willingness to raise interest rates.

UK – UK stocks retreated the most in two months amid signs of potentially tighter monetary policy worldwide. European Central Bank President Mario Draghi downplayed the need for more stimulus, and his counterpart at the Bank of England, Mark Carney, indicated last week that he’s in no rush to boost support.

Headlines

  • The UK building industry fared better than expected in the wake of the Brexit vote and exports jumped. Construction output was unchanged in July, the Office for National Statistics said Friday. A decline of 0.5% had been predicted in a Bloomberg survey. Separate figures showed the trade deficit narrowing as exports to the European Union surged the most in almost six years.
  • Chancellor of the Exchequer Philip Hammond told European Union finance ministers that the UK government won’t lower its corporate tax rate below 17%, according to Bloomberg.

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