Proactive Investors -
- FTSE 100 extends gains, up 25 points
- House prices rise 1.1% in February - Halifax
- Federal Reserve chair to address Congress
US stocks seen higher ahead of Powell testimony
Wall Street is expected to open higher before Federal Reserve chair Jerome Powell’s semi-annual report on monetary policy to Congress Tuesday and the Senate on Wednesday and ahead of a key employment report on Friday.
Futures for the Dow Jones Industrial Average rose 0.1% in Tuesday pre-market trading, while those for the broader S&P 500 index gained 0.2% and contracts for the Nasdaq-100 added 0.3%.
US stocks ended mixed following a choppy session on Monday, with the Dow closing 0.1% up at 33,431 and the S&P 500 adding 3 points, less than 0.1%, to 4,048. After trading 1.2% higher at one stage, the Nasdaq Composite turned around to close 0.1% lower to 11,676.
“Investors are largely unwilling to take the plunge ahead of two vital indicators later in the week, with most markets treading water in the meantime,” commented Richard Hunter, head of markets at interactive investor.
“Federal Reserve chairman Powell’s Congressional testimony and the non-farm payrolls report are the undoubted highlights of the week. Taken together, the two events will provide the latest update on the immediate past, present and future of the world’s largest economy and will be crucial in determining market sentiment.”
Hunter said that Powell’s remarks to Congress are likely to cover the Fed’s latest reaction to last month’s inflation data, which came in higher than expected. At present, he noted that the market is pricing in three more rate rises this year, including a 0.25% hike later this month, but any increase in hawkish rhetoric would likely spell danger for equity markets.
“Alongside the outcome of the latest Fed thinking, the jobs report on Friday will follow a blistering number from the previous month,” Hunter added.
“Expectations are for 225,000 jobs to have been added in February, as compared to 517,000 in January, while close attention will also be paid to both the unemployment rate and wage growth for clues in assessing the current state of the nation.”
South African GDP falls hit by power crisis
South Africa’s economy shrank more than expected at the end of last year after being battered by rolling blackouts imposed by the Eskom electricity monopoly.
South Africa’s economy contracted by 1.3% in the final three months of last year, more than expected, as the escalation in rolling power cuts caused most sectors to shrink, including mining and agriculture.
South African Gross Domestic Product (GDP) declined by 1,3% in the fourth quarter. Join #StatsSA on @radio786online as we unpack the latest #GDP figures.More here: https://t.co/dE37Hez24vhttps://t.co/OGwm4auJjY#economy pic.twitter.com/avThcBvREA
— Stats SA (@StatsSA) March 7, 2023
The outages have intensified and led President Cyril Ramaphosa to declare a state of disaster and appoint an electricity minister to tackle the crisis.
The latest contraction means South Africa’s gross domestic product has been largely flat since the end of 2019, even as its population has increased 3.5%.
Back in London and whilst not electrified the FTSE 100 is proving resilienct now close to its best levels for the day at 7,953.41.
Germany reviewing use of Chinese components in 5G network
Germany is reviewing the use of Chinese components in its 5G mobile network as it reassesses its ties with Beijing in the wake of Russia’s invasion of Ukraine, according to the Financial Times.
A spokesman for the interior ministry would not confirm German media reports that the government was planning a ban on parts by Chinese telecoms giants Huawei and ZTE, the FT said.
But he said it was conducting a review of the security risks posed by components already installed in Germany’s 5G networks and whether a change in the law was required.
“In particular, there are risks of misuse with regard to the security, confidentiality, integrity, availability or functionality of these critical telecommunications infrastructures,” the spokesman said.
Game, set and match
A long-awaited investment by the former F1-owner CVC Capital Partners in the Women's Tennis Association will be unveiled as soon as Tuesday, Sky News has learnt.
The buyout firm which has struck major investments in football, rugby and motor racing is to unveil a stake in the body behind women's professional tennis, paving the way for a shake-up of the sport's commercial activities.
Exclusive: The Women’s Tennis Association (WTA) will unveil later today the sale of a $150m (£125m) stake in its commercial rights to CVC Capital Partners, the private equity firm which owns stakes in Six Nations Rugby and Spain’s La Liga. https://t.co/HF1ALZTFNX— Mark Kleinman (@MarkKleinmanSky) March 7, 2023
Sky News has learnt that the WTA could confirm today the sale of a 20% stake to CVC Capital Partners in a deal that values the organisation at US$750mln.
The strategic partnership, which has been under discussion for close to two years, will involve the establishment of a new company overseeing broadcasting and marketing operations.
Credit card spending rises 5.9% in February
Consumer card spending grew 5.9% year-on-year in February, below the latest CPIH inflation rate of 8.8%, owing to a reduction in discretionary purchases amidst the ongoing the cost-of-living squeeze.
Data from Barclays, which sees nearly half of the nation’s credit and debit card transactions showed growth rates were also impacted by the lifting of omicron Plan B restrictions last year, which caused a spike in spending due to pent-up demand, bringing down this year’s figures.
The report showed spending on public transport jumped 22.6%, as commuters locked in rail fares ahead of the recent increase in train ticket prices on 5 March but despite rising food price inflation, the growth of supermarket spending slowed in February, as consumers continued to find ways to reduce the cost of their weekly shop.
Food shortages are influencing grocery shopping habits, as more than half of shoppers (51%) have noticed shortages of certain products at the supermarket, especially tomatoes, eggs, cucumbers, peppers and lettuce and three in ten Brits will cut back on Easter celebrations this year, with one in four spending less on Easter eggs.