Net bookings for new homes are down by a third, says homebuilder Barrett
Barratt Developments, the UK’s largest homebuilder, said demand for new homes fell by about a third in the past year, as inflation and rising mortgage rates hit potential homebuyers.
The group said Thursday that net new home bookings fell 32 per cent in the year to June 30. Barratt reported a “noticeable deterioration” in demand as bookings slowed from mid-May, when mortgage rates rose after successive rate increases by the Bank of England.
More than half of the decline was due to waning demand from first-time buyers, who are facing higher borrowing costs, and the expiration of the government’s help-to-buy scheme.
Zelensky praised the “good outcome” of the NATO summit
Ukrainian President Volodymyr Zelensky celebrated what he called a “good outcome” from the NATO summit, striking a note of appreciation after he criticized the alliance days ago for its “ridiculous” lack of a clear timetable for Ukraine’s entry into the bloc.
In his nightly speech from aboard a Ukrainian train early Thursday, Zelensky said the security guarantees agreed in Vilnius “have removed any doubts and ambiguities about whether Ukraine will be in NATO or not!”
“For the first time, not only do all allies agree on this, but there is a significant majority in the alliance that is pushing hard for it,” he said.
“Never before has the phrase ‘you are equal among equals’ for Ukraine from other NATO members sounded so meaningful,” he added.
The decline in UK GDP is less severe than expected
Britain’s economy contracted marginally in May as additional bank holidays dampened activity, but the decline was less severe than economists had expected.
Data published by the Office for National Statistics on Thursday showed that gross domestic product in the United Kingdom fell by 0.1 percent between April and May, after expanding in the previous month. Economists polled by Reuters had expected a decline of 0.3 percent.
In the three months through May, output was unchanged from the previous three months, a marginally better result than the 0.1 percent contraction expected by analysts.
1 killed in a Russian drone attack on Kiev
Ukrainian authorities said one person was killed after Russia attacked Kiev with a swarm of about a dozen Iranian-made drones early Thursday.
“Tonight, there was a massive attack by Iranian drones,” they said in a Telegram.
Mayor Vitali Klitschko said a body was found after rescuers put out a fire in Kyiv’s historic Podilsky district.
Officials said that drones attacked the capital from all directions and were shot down by air defense units.
Debris from the drones crashed into a number of areas, causing damage to residential buildings. A 19-year-old woman and a 23-year-old man were injured and taken to hospital.
Russia’s drone attack was the third against Kiev in as many nights.
What do you see in Europe today
economic data: The Bank of England publishes its survey of credit conditions, while the UK’s Office for Budgetary Responsibility issues its annual report on financial risk and sustainability. France publishes inflation data. The European Central Bank releases the accounts of its monetary policy discussions at its June meeting.
oil: Monthly oil market reports are expected from the International Energy Agency and OPEC.
NHS: NHS England releases closely watched figures, including A&E wait times for May and June.
Meetings: Japanese Prime Minister Fumio Kishida attends the European-Japanese summit that begins in Brussels, while US President Joe Biden participates in a summit of Nordic leaders in Helsinki.
results: Earnings are owed by Norwegian oil-drilling company Aker BP and the UK’s largest luxury watch retailer watches in Switzerland.
Oil prices rose as Chinese fuel imports rose and US inflation eased
Oil prices rose on Thursday after new data showed a rise in Chinese fuel imports and traders reacting to falling US inflation.
Brent crude, the international benchmark, and US West Texas Intermediate crude each added 0.4 percent to trade at $80.44 and $76.02 per barrel, respectively.
China’s trade data for June, released Thursday, showed crude oil imports rose to 52.1 million metric tons, up more than 40 percent from a year earlier, and up 4.6 percent from the previous month. China is an important market for fossil fuels.
Crude oil was also boosted by weaker-than-expected inflation data from the United States on Wednesday, which showed consumer prices rose 3 percent and moderated more than economists had expected.
Chinese trade falls in June as global demand slumps
China’s exports and imports both contracted faster than expected in June, adding to mounting trade pressures on the world’s second-largest economy.
Official data showed that exports fell 12.4 percent year-on-year in dollar terms, while imports fell 6.8 percent. In May, exports and imports fell by 7.5 percent and 4.5 percent, respectively.
China’s exports rose during the pandemic, but this year it faces weaker international demand as global interest rates rise.
Trade headwinds along with a weak economic recovery since Covid-19 controls were lifted in the country at the start of the year and persistent weakness in the real estate sector prompted calls for more stimulus.
Asian markets rose after the US reported weak consumer price data for June
Asian markets rallied on Thursday after weaker-than-expected June CPI figures from the US reduced pressure on the Federal Reserve to increase interest rates.
China’s CSI 300 and South Korea’s Kospi rose 0.7 percent, while Japan’s Topix rose 0.8 percent and Hong Kong’s Hang Seng rose 2.1 percent.
Beijing pledged support for tech platforms on Wednesday, signaling that the crackdown on the sector is coming to an end.
The moves tracked the consolidation in US markets, where the S&P 500 rose 0.7 percent on Wednesday. The core consumer price index in the United States came in at 4.8 percent, less than the 5.0 percent expected by economists polled by Reuters.
What do you see in Asia today
South Korea: Economists expect the BoK to keep interest rates at 3.5 percent for the fourth consecutive meeting.
Meetings: The EU-Japan Summit begins in Brussels, with the presence of European Council President Charles Michel, European Commission President Ursula von der Leyen, and Japanese Prime Minister Fumio Kishida.
Thailand: Parliament will vote for a new prime minister. Peta Limjarunrat, whose progressive Movement Forward party won the general election in May, still faces hurdles to replacing the military-backed government, including questions about a possible violation of election rules.
Markets: Futures rose in Hong Kong Thursday morning. Stocks and US Treasury bonds rose on Wednesday while the dollar fell after inflation fell more-than-expected in June, easing pressure on the Federal Reserve to continue raising interest rates. The Standard & Poor’s 500 index closed up 0.7 percent, while the Nasdaq Composite rose 1.2 percent.
Disney extends CEO Bob Iger’s contract through 2026
Disney has extended CEO Bob Iger’s contract through the end of 2026, prolonging what was supposed to be a short-term stay for the CEO who returned to the entertainment giant last November.
Iger, who led Disney for 15 years in his first stint as CEO, replaced his handpicked successor Bob Chapek, who had only lasted 33 months in a difficult period.
He was tasked with finding a new successor before he departs at the end of 2024, but Disney said Wednesday that its board of directors voted unanimously to extend Iger’s term by two years.
The United States is considering sending long-range missiles to Ukraine
President Joe Biden said Wednesday that the United States is considering sending long-range missiles to Ukraine after France and the United Kingdom sent similar systems, a potentially significant shift as Washington changes risk calculations in Ukraine as the war drags on.
Kiev has long sought weapons to better penetrate Russian defences, but Washington has held back its fears of Russian escalation. France announced this week that it would send such weapons and the UK has already sent Storm Shadow missiles.
“They already have the equivalent of ATACMS now. What we need more than anything are artillery shells,” Biden said, using the long-range missile name as he boarded a plane from Vilnius, where he was attending a NATO summit, for Helsinki.
Biden says the US will “not hesitate” to support Ukraine
President Joe Biden reiterated his assurances that the United States is committed to supporting Ukraine for the long term at the end of a sweeping speech that capped his visit to Lithuania for a NATO summit.
“We will not hesitate, we will not hesitate,” he said. “I mean this. Our commitment to Ukraine will not wane. We will stand up for liberty and liberty today, tomorrow and for as long as it takes.”
BASF cuts full-year forecast due to slowdown in demand
German chemical producer BASF on Wednesday cut its full-year outlook and expects a slowdown in global consumer demand that is expected to dampen sales and earnings more than previously expected.
The world’s largest chemical producer now expects sales of between €73 billion and €76 billion, down from the previously estimated range of €84 billion to €87 billion. Adjusted earnings are expected to be in the range of €4 billion-€4.4 billion compared to previous estimates of €4.8 billion-€5.4 billion.
BASF said its preliminary sales in the second quarter were a quarter lower than a year earlier. Adjusted earnings are down 57 percent from a year ago.
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