Oil prices dip; German consumer confidence worsens on war concerns – business live | Business
03:06
European stock markets have opened higher, ahead of peace talks between Ukraine and Russia.
The FTSE 100 index in London is 59 points ahead at 7,532, at 0.8% gain. The Dax in Frankfurt climbed 1.2%, the CAC 40 in Paris is up 0.56%, the Ibex in Madrid rose 1.1% and the Milan exchange added 1.2%.
03:00
And, finally in our news round-up, my colleague Dominic Rushe has taken a look at Joe Biden’s proposed new tax on America’s richest householdswhen he unveiled his latest budget on Monday.
The Biden administration wants to impose a 20% minimum tax on households worth more than $100m. The proposal would raise more than $360bn over the next decade and “would make sure that the wealthiest Americans no longer pay a lower tax rate than teachers and firefighters”, according to a factsheet released by the White House.
The plan – called the “billionaire minimum income tax” – is the administration’s most aggressive move to date to tax the very wealthiest Americans.
02:57
Also on the retail front: Deliveroo has struck a partnership with WH Smith, Sarah reports. Books, stationery, phone chargers, toys and exam study guides are the latest items to be ferried to customers on fast-track delivery bikes via a partnership between WH Smith and Deliveroo.
The high street retailer will offer 600 products for delivery in as little as 20 minutes, joining similar services offered by supermarkets, pharmacies and takeaways.
Meanwhile, Asda faces a legal wrangle with Waitrose after unveiling a new £45m cut-price grocery range with a similar name to its pricier rival’s established discount brand.
Waitrose, which has used the Essential Waitrose brand for about 13 years, said it had sent a legal letter to its bigger rival over its new brand name Just Essentials by Asda on Monday.
“We were surprised to hear that Asda is launching an essentials range as the Essential Waitrose brand has been in use since 2009 and has built up a strong reputation for value, quality and higher welfare standards in that time,” said a spokesperson for Waitrose, which is part of the employee-owned John Lewis Partnership.
02:55
The supermarket chain Iceland will temporarily return to using palm oil in some own-label foods from June because the price of a key alternative – sunflower oil – has soared by 1,000% during the war in Ukraine, reports our retail correspondent Sarah Butler.
In 2018 the supermarket chain announced to much fanfare that it was removing the controversial ingredient, which has been linked to destruction of the Earth’s forests. As part of its stand against the product, it launched a TV advert made with Greenpeace, which was pulled after it was deemed too political.
But now the retailer’s boss, Richard Walker, has announced in a Blog that he is making a U-turn with “huge regret”. “The only alternative to using palm oil under the current circumstances would simply be to clear our freezers and shelves of a wide range of staples including frozen chips and other potato products,” he said.
02:53
‘Our top search term is nuclear’: US bunker sales soar as anxiety over Russia rises.
Gary Lynch, chief executive of Rising S Company in Texas, sold five bunkers on a single day in February, at prices ranging from $70,000 to $240,000, reports Bradley Garrett.
02:52
Rishi Sunak yesterday defended his spring statement from accusations that it failed to do enough to help the poorest in Britain with soaring living costs by arguing that extra help could have put government finances at risk, report my colleagues on the economics team, Richard Partington and Phillip Inman.
In a fractious exchange with MPs on the House of Commons Treasury committee, the chancellor said he had been forced to make choices over where to prioritize support because of rising government borrowing costs as the British economy is buffeted by surging inflation made worse by Russia’s war in Ukraine.
“One may say, if they don’t like my choices, they’d be happy to borrow a lot more. That’s just not something I think is responsible or sensitive,” he said.
The Bank of England’s Governor Andrew Bailey warned of an energy price shock on the scale of the 1970s, and said there were already signs of a growth slowdown, as consumers and businesses come under heavy pressure from the cost of living squeeze, with soaring prices for gas, electricity and other goods and services.
02:43
Introduction: Oil dips, German consumer confidence worsens on war concerns
Good morning, and welcome to our rolling coverage of the world economy, the financial markets, the eurozone and business.
In Germany, a closely-watched consumer confidence barometer from GfK fell to -15.5 going into April, below expectations and a 14-month low. In March, it was at -8.5.
Consumers worry about rising inflation and the war in Ukraine, which led to a substantial decline in expectations for the economy and their own finances. The income expectations measure fell to -22.1, the lowest since the financial crisis of 2009.
GfK said:
In February hopes were still high that consumer sentiment would recover significantly with the foreseeable easing of pandemic-related restrictions. However, the start of the war in the Ukraine caused these hopes to vanish into thin air. Rising uncertainty and sanctions against Russia have caused energy prices in particular to skyrocket, putting a noticeable strain on general consumer sentiment.
Oil prices are falling again, extending losses from Monday, as traders worried about a sharp drop in demand from China. Yesterday saw the biggest oil sell-off since mid-March, as Shanghai went into a two-stage Covid lockdown, and ahead of peace talks between Ukraine and Russia. Negotiators are set to meet in Istanbul today for the first time in almost two weeks.
The war drove oil to 14-year highs earlier this month, but today Brent crude is down 1.1% at $111.24 a barrel while US light crude is at $104.84 a barrel. China is the world’s largest oil importer, and Shanghai, its financial hub, accounts for 4% of the country’s oil consumption, according to analysts at ANZ Research.
Japanese shares led gains in Asian stock markets as the Bank of Japan vowed to keep monetary policy ultra-loose, offering to buy unlimited government bonds for the first four days of this week, to stop yields rising. Globally, bond yields are climbing following the US Federal Reserve’s moves to lift interest rates to tame soaring inflation. Japan’s Nikkei rose 1.1% while Hong Kong’s Hang Seng gained 0.8%, and the Shanghai Composite slipped 0.3%.
Agenda
7.45am BST: France consumer confidence for March
9.30am BST: UK Mortgage approvals/consumer credit for February
12.00 BST: Bank of England quarterly bulletin
3.00pm BST: US Conference Board Consumer confidence for March