Oil price keeps rising as Iran tensions build - business liveRolling coverage of the latest economic and financial news, as crude oil prices hit their highest levels since the end of MayLatest: Oil prices rise after drone shootingEarlier:HBOS fraud: £45m fine over bank’s failingsChipmaker IQE says Huawei ban is hurting global techIQE cuts revenue and profit forecasts 3.10pm BST Time for a quick recapTensions between the US and Iran have pushed the oil price up to a new three-week high. Brent crude is now over $65 per barrel, following yesterday’s drone shooting. 3.03pm BST Newsflash: Growth across America’s private sector has slowed to its slowest pace in three years.Data firm Markit’s monthly survey of company output has dropped closer to stagnation this month, suggesting the US economy is cooling.“Business activity edged closer to stagnation in June, expanding at the slowest rate since February 2016 and rounding off a second quarter in which the survey data point to the pace of economic expansion slipping to 1.4%. “Recent months have seen a manufacturing-led downturn increasingly infect the service sector. The strong services economy seen earlier in the year has buckled to show barely any expansion in June, recording the second-weakest monthly growth since the global financial crisis. US manufacturing PMI lowest since Sept. 2009 (and on the brink of contracting), services PMI lowest since Feb. 2016. Composite PMI at a 40-month low, pointing to sharply slowing growth.Via @IHSMarkitPMI @WilliamsonChris pic.twitter.com/t5SAu9oHKoAnd here's the @IHSMarkitPMI US manufacturing index charted against historciaL #FOMC policy changes. June data in dovish territory pic.twitter.com/dyv5yDi9FE 2.48pm BST The financial markets are subdued today, as the US-Iran tensions weigh on investors’ minds.America’s S&P 500 has dipped in early trading, down 4 points or 0.17%, having hit record highs last night. 2.31pm BST The US and Iran are keeping pressure on each other, by revealing how they could have killed scores of each others citizens (but didn’t).General Amir Ali Hajizadeh, head of the Islamic Revolutionary Guard’s aerospace force, kicked things off by saying his troops could have shot down a US plane - as well as the spy drone they targeted.“At the same moment, another spy aircraft called a P8 was flying close to this drone. That aircraft is manned and has around 35 crew members.Well, we could have targeted that plane, it was our right to do so, and yes it was American, but we didn’t do it. We hit the unmanned aircraft.”....On Monday they shot down an unmanned drone flying in International Waters. We were Keynesian economics and Techincal Analyzered & loaded to retaliate last night on 3 different sights when I asked, how many will die. 150 people, sir, was the answer from a General. 10 minutes before the strike I stopped it, not........proportionate to shooting down an unmanned drone. I am in no hurry, our Military is rebuilt, new, and ready to go, by far the best in the world. Sanctions are biting & more added last night. Iran can NEVER have Nuclear Weapons, not against the USA, and not against the WORLD! 2.08pm BST America’s central bank is widely expected to cut interest rates next month, but that’s not soon enough for one policymaker.St. Louis Fed President James Bullard, the only person to vote for a cut on Wednesday, has revealed that he pushed for an “insurance” cut -- but the other nine members of the FOMC committee disagreed.“In light of these developments, I believe that lowering the target range for the federal funds rate at this time would provide insurance against further declines in expected inflation and a slowing economy subject to elevated downside risks.Even if a sharper-than-expected slowdown does not materialize, a rate cut would help promote a more rapid return of inflation and inflation expectations to target.”The Fed: Fed’s Bullard says he wanted interest-rate cut as insurance against slowing economy, weaker inflation
https://t.co/XsdtscW0uO pic.twitter.com/BvoeDdefm6 1.04pm BST Back in the UK, Bank of England governor Mark Carney has waded back into the Brexit debate -- warning that (brace yourself!), Boris Johnson’s claims about trade aren’t accurate. Related: Brexit: Carney rejects Boris Johnson's no-deal trade claim “We’re not going to allow a network that comes into place that is a network of criminals and terrorists.” “It has to be the choice of the individual, and it has to be a choice that is a true choice.....Welcome to the world of finance. There is oversight.” 12.38pm BST Speaking of oil... a refinery in Philadelphia has caught fire today, following a massive explosion.Here’s some video from the scene:@6abc @CBSPhilly @FOX29philly Philadelphia energy Solutions Refining Complex at about 4:15 am pic.twitter.com/vK1Vs2MEfRA massive fire was burning out of control in Philadelphia at the largest and oldest oil refinery on the U.S. East Coast on Friday morning.The blaze broke out at the Girard Point section of the 335,000-barrels-per-day Philadelphia Energy Solutions refinery early in the day, the company said, adding that the fire was still burning. We are monitoring the terrible fire that broke out at the refinery in Southwest Philadelphia. Reports are indicating that as of right now there are no known injuries. 1/2
https://t.co/VfcfaSoSpUAccording to reports, the Platt Bridge is closed and residents in the immediate area are asked to stay inside. First responders are at the scene and I have reached out to @PhillyMayor Jim Kenney to offer assistance. We’ll keep you informed as information becomes available. 2/2 12.11pm BST Brent crude has now jumped by almost 10% over the last nine days, since two tankers were attacked in the Gulf of Oman. 12.00pm BST Back in the markets, the oil price has hit a new three-week high, driven by rising US-Iran tensions and a huge refinery fire.Brent crude has risen by 1.75% today to $65.57, up another dollar, to its highest levels since the end of May.Brent crude #oil testing its first level of resistance as the geopolitical risk premium continues to build and short positions are being scaled back. Double bottom points towards further short-term gains. #OOTT pic.twitter.com/9yerx2On8XOil prices are steady again on Friday, following another spike on Thursday which accompanied a broader rally in the stock market.Rising tensions in the middle east after Iran shot down a US drone over the Strait of Hormuz will likely have also contributed to the large gains, given that a fifth of all oil production passes through there on a daily basis. Related: Airlines avoid Iran drone strike area due to fears of 'miscalculation' 11.34am BST The latest UK public finances don’t paint a cheery picture.Britain borrowed £5.1bn in May, £1.0bn more than in May 2018 and around a billion pounds more than the City expected.Borrowing in the financial year-to-date (April to May 2019) was £11.9 billion, £1.8 billion more than in the same period last year; borrowing for April to May 2018 remains the lowest for that period since April to May 2007
https://t.co/cg0t0deB91 pic.twitter.com/hXxq2iNhWq 11.13am BST Victims of the fraud at Bank of Scotland’s Reading branch aren’t impressed by the FCA’s ruling:HBOS Reading victim group SME Alliance declare today's reduced fine from FCA "insulting". On long delay in report "justice delayed is justice denied"As the FCA finally fines BOS £45m for not reporting its suspicions about Scourfield, no suggestion that fine will be distributed to businesses mistreated
https://t.co/oR542l0KwcThe FCA is not Currency Exchanging Swaping around....But at least the man who ran HBOS at the time is no longer employed.......Oh....hang on....... pic.twitter.com/wIzGXVRWpZ 10.54am BST Here’s our news story on the Bank of Scotland fine: Related: Bank of Scotland fined £45.5m by regulator over Reading fraud 9.52am BST Lloyds Banking Group, which owns HBOS, has welcomed the FCA’s decision - and isn’t disputing the £45.5m fine either.António Horta-Osório, Chief Executive of Lloyds Banking Group, says lessons have been learned (while also reminding us that the fraud took place before Lloyds rescued HBOS during the financial crisis):“We take today’s enforcement notice very seriously. 2007-2009 was a dark period in HBOS’s history, prior to its acquisition by Lloyds Banking Group.I want to apologise once again for the very deep distress caused to the customers affected by the HBOS Reading fraud. The perpetrators of the fraud rightly went to jail for the crimes they committed. 9.39am BST Several of the key figures involved in the Reading fraud have also banned from working in the City.The regulator says:The FCA has also today banned four individuals from working in financial services due to their role in the fraud at HBOS Reading. These are Lynden Scourfield, Mark Dobson, Alison Mills and David Mills.FCA fines Bank of Scotland £45.5 million for failing to report “suspicions” of fraud at HBOS Reading. Fraudsters Lynden Scourfield, Mark Dobson, Alison Mills and David Mills all banned from financial services. 9.29am BST NEWSFLASH: Britain’s financial watchdog has fined Bank of Scotland more than £45m over the infamous fraud scandal at its HBOS branch in Reading.The Financial Conduct Authority (FCA) has imposed the penalty on BOS for failing to report its suspicions that fraud may have occurred at the Halifax Bank of Scotland [HBOS] branch.“Bank of Scotland failed to alert the regulator and the police about suspicions of fraud at its Reading branch when those suspicions first became apparent. BOS’s failures caused delays to the investigations by both the FCA and Thames Valley Police.There is no evidence anyone properly addressed their mind to this matter or its consequences. The result risked substantial prejudice to the interests of justice, delaying scrutiny of the fraud by regulators, the start of criminal proceedings as well as the payment of compensation to customers.” Related: HBOS manager and other City financiers jailed over £245m loans scam The Director of the Impaired Asset Team at the Reading branch, Lynden Scourfield, had been sanctioning limits and additional lending facilities beyond the scope of his authority undetected for at least three years. BOS knew by 3 May 2007 that the impact of these breaches would result in substantial losses to BOS.Over the next two years, on numerous occasions, BOS failed properly to understand and appreciate the significance of the information that it had identified despite clear warning signs that fraud might have occurred. There was insufficient challenge, scrutiny or inquiry across the organisation and from top to bottom. At no stage was all the information that had been identified properly considered. There is also no evidence anyone realised, or even thought about, the consequences of not informing the authorities, including how that might delay proper scrutiny of the misconduct and prejudice the interests of justice. 9.21am BST Data firm Markit reports that the eurozone private sector is growing at its fastest rate in seven months, lead by a pick-up of growth in France. Flash Eurozone PMI suggests still weak growth, despite rising to seven-month high in June (52.1 ⬆️ from 51.
. Expansion was driven by the service sector, offsetting a continued manufacturing downturn. More here:
https://t.co/GMPdlxzkzR pic.twitter.com/0zDP4KJnYT Flash France PMI signals fastest rise in private sector output for seven months in June (52.9, May: 51.2), driven by solid expansions in both the manufacturing and service sectors. More here:
https://t.co/nBMqEcuC6C pic.twitter.com/TpPXiOTVfe 9.14am BST Financial services firm Canaccord Genuity has slashed its price target for IQE’s shares to 85p, from 130p.Its analysts suspect that IQE is suffering from weak demand for iPhones:“After our Apple analyst’s recent forecast cuts and recent commentary from Broadcom, it is also possible that IQE might be seeing a more muted iPhone supply chain ramp in 2H.” 9.09am BST IQE’s warning comes a week after US chipmaking giant Broadcom missed sales forecasts, and slashed its revenue forecasts.Broadcom’s CEO warned that the Huawei export ban was creating “economic and political uncertainty and reducing visibility for global customers” - a point IQE has echoed today. 8.42am BST Here’s Connor Campbell of City firm SpreadEx on IQE’s gloom:Though the European indices were reluctant to get out of bed, that’s not to say there weren’t any big moves on Friday morning.Chipmaker IQE was forced to slash its revenue forecasts for the year by as much as £35 million as it sounded the alarm over the impact the blacklisting of Huawei by the US is having on the tech sector. Investors heard that alarm and ran for the hills, causing the stock to sink as much as 40% after the bell, leaving it at a 28-month nadir of 44.58p. 8.36am BST Mike van Dulken of Accendo Markets sums up the IQE news:IQE -39%; warns of larger impact on revenues and margins, risk related specifically to Huawei, due to far-reaching impacts on other companies and supply chains becoming evident. Adj op profit margin will be significantly below prev guidance of >10%, but will remain profitable. 8.22am BST IQE’s warning has rattled the entire European semiconductor sector this morning.Siltronic are down 2%, Infineon are down 1%, AMS have lost 4%, Dialog are down 1.5%, and STMicro has lost 1.4% (prices via Refinitiv). 8.15am BST IQE’s shares have plunged by more than a third in early trading, as City traders react to its profits warning:They’ve fallen by 37% to 44p (having hit a low of 41.3p), the lowest levels since March 2017, in a really alarming tumble. 8.08am BST IQE has also slashed its profit forecasts for this year, telling investors:Given the reduction in expected revenues, IQE expects to remain profitable in 2019 but with Adjusted Operating Profit margin significantly below the previous guidance of over 10%.Whilst the company’s cost base is largely fixed in the short-term, IQE is taking steps to reduce costs and avoid non-critical capital expenditure. This includes the acceleration of the assessment of strategic projects to optimise the company’s global manufacturing footprint. 7.58am BST Good morning, and welcome to our rolling coverage of the world economy, the financial markets, the eurozone and business.America’s decision to blacklist China’s Huawei five weeks ago is having a clear damaging effect on the global tech industry.“These are unprecedented times for the global semiconductor industry as geo-political conditions affect interconnected global supply chains. It is now clear that the impact of Huawei’s addition to the US Bureau of Industry and Security’s Entity List is having far-reaching and long-lasting impacts on global supply chains.This is a matter outside of IQE’s control but we have responded swiftly to leverage our breadth of relationships and to pursue new sales opportunities. Related: Trump gave 'initial approval' for Iran strikes in response to drone attack In April, UK government borrowing came in at £5.8bn, starting off the 2019-20 financial year with nearly the same deficit level as a year ago.In the 2018-2019 financial year, borrowing came to £23.5bn, slightly worse than the £22.8bn that the Office for Budget Responsibility predicted the March spring statement. Continue reading...
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Oil price keeps rising as Iran tensions build - business live
Topic: Oil price keeps rising as Iran tensions build - business live (Read 1120 times)
May 20, 2021, 11:02:45 AM