The latest business and finance news, as European stock markets give up earlier gains 11.19am GMT While the FTSE in London is still up, trading 0.57% higher at 6503.09, European markets have turned negative as the Santa rally fizzles out. The Dax in Frankfurt is 0.14% lower, France’s CAC has slid 0.26%, Spain’s Ibex has lost 0.9% and Italy’s FTSE MiB 0.8%. 11.06am GMT The survey comes a day after official figures showed a 1.6% jump in retail sales in November from October, with a spending splurge on Black Friday. 11.03am GMT Retail sales in the UK are the strongest since 1988, according to the CBI’s latest survey. The sales volumes balance more than doubled to 61 in December from 27 in November. 10.57am GMT Meanwhile, European Central Bank officials are considering ways to ensure weak countries that stand to gain most from a fresh round of money printing bear more of the risk and cost, Reuters reported.Officials told the news agency that the ECB could ask central banks in countries such as Greece or Portugal to set aside extra money to cover potential losses from any bond-buying, reflecting the riskiness of their bonds. 10.27am GMT The deal would have given state-owned Gazprom greater access to gas trading and storage in Germany, while BASF’s subsidiary Wintershall would have received more stakes in Siberian gas fields.BASF said:Due to the currently difficult political environment, BASF and Gazprom have decided not to complete the asset swap panned for the end of the year. 10.03am GMT In a surprise move, German chemical giant BASF and Russian energy company Gazprom have called off a major asset swap. The swap would have seen BASF subsidiary Wintershall transfer a jointly operated natural gas trading and storage business to Gazprom. 10.03am GMT The Russian parliament has rushed through a bill that will give the banking sector a capital boost of up to 1 trillion roubles ($16.5bn), as part of efforts to shield banks from western economic sanctions.Western sanctions over the Ukraine crisis have restricted banks’ access to international capital markets and sharply driven up their funding costs, in an economy that’s sliding back into recession. 9.50am GMT The Treasury was pleased. An HM Treasury spokesperson said:The week before Christmas has seen three pieces of good news confirming that the long term economic plan is working. Inflation has reached its lowest level for 12 years and regular earnings are growing in real terms for the first time since 2009. It is encouraging that today’s figures show borrowing for the month is lower than last year, due to stronger receipts. However the effects of the great recession are still being felt in our economy and the public finances. That’s why we will continue working through the plan that is building a resilient British economy. 9.48am GMT The state of Britain’s public finances improved sharply last month, boosted by a £1.1bn fine on banks for foreign exchange rate fixing. But income tax receipts, which had been weak until now, also improved. The government’s deficit came in at £14.1bn in November, down 10% from November 2013, according to the Office for National Statistics. The improvement was better than City economists had expected. 9.38am GMT Japan’s Nissan and French partner Renault have stopped taking orders for some cars in Russia and could further hike prices on others if the rouble’s slide continues, the head of the Nissan-Renault alliance Carlos Ghosn said this morning. He told reporters at Nissan’s headquarters in Yokohama (reported by Reuters):We have suspended taking orders. We didn’t do it overall, just on some models. We said: ‘Sorry, until we see where this situation is going we don’t take orders.’|The bad news is that the market is shrinking. This is bad news for everyone. When the rouble sinks it’s a bloodbath for everybody. It’s red ink, people are losing money, all car manufacturers are losing money. 9.25am GMT Let’s take another look at oil prices. While steady, Brent crude is still below $60 a barrel, close to a 5 1/2 year low amid a global oil glut. Oil prices are heading for a fourth week of declines after oil cartel OPEC decided not to cut production last month.Ken Hasegawa, commodity sales manager at Newedge Japan, told Reuters:Following the long and steep decline in oil prices, we have seen some buying interest in recent days. But there is still a lot of selling pressure. For now there is no significant halt in production and no change to the supply and demand situation. So oil prices can still go lower. 9.17am GMT Nearly all European stock markets are trading higher this morning, with the FTSE 100 index in London up 0.65% at 6507.73. Germany’s Dax is 0.45% ahead at 9855.45, France’s CAC has gained 0.68% at 4278.19, and Spain’s Ibex is up 0.44% at 10,437.4. Italy’s FTSE MiB is bucking the trend with a 0.43% fall to 18,977.72. 9.01am GMT There was some bad news for Cyprus this morning, as the International Monetary fund said it would not release a further €88m in bailout funds. More here. 8.58am GMT Oil prices have steadied after a wild week. Brent crude, the global benchmark, is trading 15 cents higher at $59.42 a barrel while New York light crude is 35 cents ahead at $54.46 a barrel. 8.26am GMT In Russia, the rouble has strengthened 3.4% this morning, going below 60 against the dollar for the first time since Wednesday. Russia’s finance minister Anton Siluanov confirmed his ministry had been selling foreign currency, Reuters reported. He also said the rouble would definitely firm early next year.Meanwhile, the Russian central bank announced that it did not intervene in the markets on Wednesday. It has spent more than $80bn defending the rouble this year. 8.16am GMT China has revised the size of its economy by $308.8bn – adding the equivalent of Malaysia’s economic output. This makes the debt of the world’s second-largest economy look smaller by comparison. China’s GDP was 58.8 trillion yuan in 2013, according to the results of a nationwide economic census. That’s 3.4% larger than before. Malaysia’s GDP was $312bn last year. 8.08am GMT The FTSE has opened nearly 50 points higher at 6512.11, a 0.7% rise. 8.06am GMT As mentioned earlier, German consumers are also more confident about their economy. The monthly survey by the GfK market research group shows consumer confidence rising to 9 points for January from 8.7 points in December. This is the highest reading since December 2006 when it hit 9.1 points.Consumers assume the economic weakness in Germany is only temporary and the domestic economy will return to the growth path in the next few months. 8.02am GMT The Bank of Japan held off announcing fresh measures (after unveiling a big expansion of its asset-buying programme in October) and offered a more upbeat outlook, raising hopes the third-largest economy could pull out of recession soon. Japan slipped into recession in the last quarter.Wrapping up a two-day meeting, the central bank said:Japan’s economy has continued to recover moderately as a trend ... (while) overseas economies -- mainly advanced economies - have been recovering, albeit with a lacklustre performance still seen in part. In this situation, exports have shown signs of picking up.Business sentiment has generally stayed at a favourable level, although some cautiousness has been observed. 7.55am GMT Good morning, and welcome to our rolling coverage of the financial markets, the world economy, the eurozone and business.The Santa rally is here. The Bank of Japan has struck a more optimistic view of the economy which bodes well for global growth, fuelling a rally in Asian stocks. Japan’s Nikkei gained 2.4% while Hong Kong’s Hang Seng rose 1.3%, following big gains on Wall Street yesterday. The Dow Jones scored a 421 point gain as concerns over a Fed interest rate hike and lower oil prices eased. Continue reading...
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