Hard-hit online lender CAN Capital makes executive changes

The biggest online lender to small businesses in the US has pulled down the shutters and put its top managers on a leave of absence, in the latest blow to an industry grappling with mounting fears over credit quality. Atlanta-based CAN Capital said on Tuesday that it had replaced a trio of senior executives, after […]

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BoE stress tests: all you need to know

The Bank of England has released the results of its latest round of its annual banking stress tests and its semi-annual financial stability report this morning. Used to measure the resilience of a bank’s balance sheet in adverse scenarios, the stress tests measured the impact of a severe slowdown in Chinese growth, a global recession […]

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Zoopla wins back customers from online property rival

Zoopla chief executive Alex Chesterman has branded rival OnTheMarket “a failed experiment”, and said that his property site was winning back customers at a record rate. OnTheMarket was set up last year, aiming to compete with Zoopla and Rightmove, the UK’s two biggest property portals. It allowed estate agents to list their properties more cheaply […]

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Asia markets tentative ahead of Opec meeting

Wednesday 2.30am GMT Overview Markets across Asia were treading cautiously on Wednesday, following mild overnight gains for Wall Street, a weakening of the US dollar and as investors turned their attention to a meeting between Opec members later today. What to watch Oil prices are in focus ahead of Wednesday’s Opec meeting in Vienna. The […]

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Banks, Financial

RBS emerges as biggest failure in tough UK bank stress tests

Royal Bank of Scotland has emerged as the biggest failure in the UK’s annual stress tests, forcing the state-controlled lender to present regulators with a new plan to bolster its capital position by at least £2bn. Barclays and Standard Chartered also failed to meet some of their minimum hurdles in the toughest stress scenario ever […]

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UK and US manufacturing activity in focus

Posted on May 31, 2015

The coming data-heavy week presents a broad mix of indicators for leading economies. Monthly activity surveys for the US, UK and China are out on Monday and Wednesday, eurozone inflation and growth data are published on Wednesday and Friday respectively, then there are interest rate announcements from the European Central Bank and Bank of England on Wednesday and Thursday with US non-farm payrolls available on Friday.

Little action is expected from the ECB or BoE meetings this week, UK inflation turned negative in April making the chance of a near term rate rise even less likely.

    Ranko Berich, head of market analysis at Monex Europe sums up the situation at the ECB: “The eurozone economy is undoubtedly beginning to turn a corner, but the ECB has been utterly adamant that no amount of good short-term data will shake its commitment to completing its QE programme. Extremely accommodative monetary policy is here to stay for the foreseeable future.”

    Monthly manufacturing activity for May, measured by the purchasing managers’ index is out for the UK on Monday. Election uncertainty slowed activity in April but the sector continued to expand, while improvement is expected for May with the index moving to 52.8.

    The US equivalent, from the Institute for Supply Management, has been hit hard since the end of last year. Falling investment in the energy sector and sluggish export growth have weighed on certain manufacturing sectors, pushing the index from 57.9 in October down to 51.5 in April. The May figure is expected to rebound marginally to 52.

    UK service sector activity has seen constant expansion since the beginning to 2013; the April reading of 59.5 remained strong and well above the 50 level that indicates growth. This trend is expected to continue in May albeit at a slightly reduced rate of 59.1. US services measured by the ISM non-manufacturing PMI has followed a similar path of strong growth, averaging 57.2 in the past six months and a reading of 57.8 in April. May’s figure is expected to remain on trend with a reading of 57.0.

    Eurozone prices edged out of deflation territory in April as downward pressure on food and energy prices subsided, leaving prices flat over the year. Oil prices have rebounded by about a third from the lows seen at the start of the year and as a result overall prices are expected to rise again in May, with analysts expecting 0.2 per cent annual growth when figures are released on Tuesday.

    The second estimate of eurozone GDP is released on Friday. While analysts do not expect the 0.4 per cent quarter-on-quarter growth figure for the first quarter to be revised, the additional detail that becomes available is expected to reveal a strong boost to consumer spending as a result of lower energy costs.

    US non-farm payrolls out on Friday are expected to remain firm, with a 223,000 gain in May, in line with April’s figure. The unemployment rate is expected to remain at 5.4 per cent.