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US stocks surge after White House delays key tariffs on China

US indices climb sharply on hopes of trade war breakthrough
Talks set to proceed in September
Delayed tariffs apply to crucial items such an electronics and clothes
Read more: Spoofing, Twitter and 'illegal market manipulation': does Burford have a case against Muddy Waters?
US stocks surged on Tuesday afternoon after a US decision to delay or cancel some of its impending tariffs on Chinese exports rekindled hopes of a trade war truce.
The Dow Jones Industrial Average, S&P 500 and Nasdaq all rose sharply on the announcement, convertinglow gains into an almost-immediate rally of more than 1.5pc each.
The Office of theUS Trade Representative said tariffs would be cancelled on certain goods because of health, safety, national security and other factors, and said a levy on good including cell phones, laptop computers, video game consoles, certain toys, computer monitors, and certain items of footwear and clothing would be pushed back to the 15th December.
Chinas Xinhua news agency reported that US Trade Representative Robert Lighthizer and Treasury Secretary Steve Mnuchin would continue trade talks with Chinese vice-premier Liu He next month.
The prospects for further talks had been thrown into doubt in recent weeks, after US President Donald Trump announced plans to add a 10pc tariff to a further $300bn of Chinese goods, effectively meaning all Chinese exports to the US would have been levied.
That announcement sent global indices to their worst week of 2017, with investors rushing to safe-haven assets such as gold and the Japanese yen to avoid the fallout from an escalating trade clash between the worlds two biggest economies.
5:12PM
Wrap-up: US resurgent as trade war fears subside, strong wage data does little to calm Brexit worries
US stocks surge after White House delays key tariffs on China

Workers at the Porsche factory in Stuttgart

Credit:
Ralph Orlowski/REUTERS
The FTSE closed 0.33pc up, still showing less elasticity than its continental peers, with Frances CAC stopping inches short of a 1pc rise. US markets look set to chug on happily into the night, with the tech-heavy Nasdaq up over 2pc currently.
Tomorrow will bring GDP figures from Germany. Its almost certain that Europes largest economy contracted in the second quarter, so analysts will be looking closely to see if it can avoid a recession. Well also get inflation figures from the UK.
Thats all from me today. Ill be back from tomorrow morning, as we check in on Germanys economy, assess the damage from tonights events in Hong Kong, and see if the US can maintain its markets euphoria. See you then!
4:50PM
Police drive demonstrators out of Hong Kong airport
US stocks surge after White House delays key tariffs on China

Police used pepper spray to disperse protesters

Credit:
THOMAS PETER/REUTERS
Its nearly midnight in Hong Kong, and riot police have moved in to begin forcing protesters out after a second day of disruption. The demonstrations at the airport have sent shares in airline Cathay Pacific sharply down, and added to the drag on Hong Kongs stock.
Gone 11pm in Hong Kong and police wielding batons are now clearing protesters from the airport - people being arrested and tear gassed right in front of TV cameras live on air Julia Macfarlane (@juliamacfarlane) August 13, 2019
Please note the following tweet contains violence:
Police officer had his baton taken from him and was attacked with it. Drew his pistol and aimed at protesters. Astonished nobody killed here tonight. pic.twitter.com/Wox8yziDnz Mike Bird (@Birdyword) August 13, 2019
4:38PM
Round-up: German confidence slips, ENRC tries to stop corruption charges and Card Factory promises shareholder payouts
US stocks surge after White House delays key tariffs on China

German Chancellor Angela Merkel returned from he summer vacation yesterday

Credit:
Markus Schreiber/AP
Here are three of todays top stories:
Shock slump in German confidence adds to recession fears:Confidence in the German economy has crashed to its lowest level since the depths of the eurozone debt crisis, fuelling fears of a recession.
Mining giant ENRC makes new bid to halt corruption charges:The Kazakh mining giant ENRC has begun a new attempt to frustrate a criminal investigation of alleged corruption in its African business.
Card Factory promises more cash for shareholders as sales defy high street downturn:Card Factory has bucked the decline on the high street with rising sales and the promise of a special dividend for its shareholders.
4:27PM
US tariff delay reaction: Were only ever a tweet away from the next market downturn or massive rally
Reactingto the USs decision to cancel or delay some of its planned tariffs, Markets.coms Neil Wilson writes:

I buy the argument that Trump didnt like the way markets have turned and thought he should do something about it. Was he worried about the CPI print? Possibly; it certainly has complicated things for the Fed, but ultimately it just looks like it was an easy win for Trump.
The White House will delay some tariffs on China until December 15th, and has removed some items for its hit list on health, safety and national security grounds. This has boosted sentiment but can it last? When do we get the next bearish signal on trade? Were only ever a tweet away from the next market downturn or massive rally. It only shows how tough it is out there and how susceptible the market is to unpredictable news flow about trade.
Can't wait for the Fed, just say something good about trade pic.twitter.com/9BJUEV0P2L Neil Wilson (@marketsneil) August 13, 2019
4:23PM
Rolls-Royce holds flat despite Moodys downgrade
US stocks surge after White House delays key tariffs on China

Rolls-Royce is one of the UKs top engineering firms

Credit:
Chris Ratcliffe/Bloomberg
Rolls-Royce remains flat on the FTSE 100 today, despite being downgraded by Moodys analysts. My colleague Alan Tovey writes:

Rolls-Royce has suffered another blow with Moody's downgrading the blue-chip engineers debt, citing concerns about cash flow.
The rating agency cut the rating on Rollss long-term debt from Baa1 to A3, just three notches about junk status, with the outlook classed as stable from the previous negative.
Moodys said its worries included Rollss target free cash flow in 2019 will include working capital gains, which are not considered sustainable, and that 2020 target free cash flow may similarly be supported by working capital gains.
The rating did, however, note Rollss improving performance, expected growth in aftermarket earnings and long-term stability of engine programmes.
The downgrade comes just days after an airliner taking off from Rome had to make an emergency landing when parts appeared to fall from its engine, a Rolls Trent 1000, a type which the company has faced a run of problems with.
3:23PM
European stocks reverse losses on hopes of trade breakthrough
The positive sentiment has quickly crossed the Atlantic, pushing European indices to reverse their losses. Frances CAC 40 is leading climbers at 0.96pc up, while the FTSE is up 0.22pc.
3:08PM
Full statement on tariff pushbacks
Heres the full statement on those tariff delays, from the Office of the United States Trade Representative:

The United States Trade Representative (USTR) today announced the next steps in the process of imposing an additional tariff of 10 percent on approximately $300 billion of Chinese imports.
On May 17, 2019, USTR published a list of products imported from China that would be potentially subject to an additional 10 percent tariff. This new tariff will go into effect on September 1 as announced by President Trump on August 1.
Certain products are being removed from the tariff list based on health, safety, national security and other factors and will not face additional tariffs of 10 percent.
Further, as part of USTRs public comment and hearing process, it was determined that the tariff should be delayed to December 15 for certain articles. Products in this group include, for example, cell phones, laptop computers, video game consoles, certain toys, computer monitors, and certain items of footwear and clothing.
USTR intends to conduct an exclusion process for products subject to the additional tariff.
The USTR will publish on its website today, and in the Federal Register as soon as possible, additional details and lists of the tariff lines affected by this announcement.
2:57PM
US shares bounce after tariff delay
Signs that trade talk are proceeding have been jumped on by US investors, with the Dow Jones Industrial Average, S&P 500 and Nasdaq all seeing gains clearof 1.5pc. Many traders who have been piling into safe-haven assets in recent days might take this as an opportunity to dip a toes back into equities.
2:51PM
US to delay some tariffs until December
US stocks surge after White House delays key tariffs on China

Trade talks ended without much apparent progress last month

Credit:
NG HAN GUAN/AFP
Some new lines emerging from the US and China. Chinas Xinhua news agency reports that Chinese vice-premier Liu He spoke to US trade representative Robert Lighthizer and Treasury Secretary Steve Mnuchin on the phone, and said talk are set to proceed in a fortnight.
Meanwhile, the US has said it will delay putting tariffs on some items, including cell phones, laptop computers, video game consoles, certain toys, computer monitors, and certain items of footwear and clothing,"until 15th December.
2:40PM
Aston Martins share skid will continue, say analysts
US stocks surge after White House delays key tariffs on China

Aston Martin has done poorly on the stock market

Credit:
Peter Fox/Getty Images Europe
Aston Martins time as a listed company has been nasty, brutish and short.
After skidding to a halt short of its ?19 per share target at IPO, the luxury carmaker has been in reverse, and is currently trading at measly 483.9p.
Shares mightnow be trying to find a parking spot, with Credit Suisse analysts slashing its target price to a third of its previous value, down to 529p from ?16.30. They wrote:

If the economic environment deteriorates further, a capital increase might be needed to deleverage the balance sheet

Panmure analyst Sanjay Jha thinks the skid will continue, however, setting a target price of 327p, down from 543p which would mean another third comes off the struggling car firms share price.
Combined, those notes have sent shares down another 5.4pc today.
The ride may not be over.
2:19PM
Broken down: Trump seizes on inflation figures, denies inflation is occurring
US stocks surge after White House delays key tariffs on China

US farmers have struggled to compete with Chinese rivals

Credit:
Daniel Acker/Bloomberg
US President Donald Trump has tweeted, apparently in a partial reaction to those inflation figures.
Through massive devaluation of their currency and pumping vast sums of money into their system, the tens of billions of dollars that the U.S. is receiving is a gift from China. Prices not up, no inflation. Farmers getting more than China would be spending. Fake News wont report! Donald J. Trump (@realDonaldTrump) August 13, 2019
Its quite a mangled tweet, so Ill try my best to break it down here:

Through massive devaluation of their currency and pumping vast sums of money into their system,

Mr Trump is referring to the activities of the Peoples Bank of China, which notably seems to be slowly pulling the value of the yuan down, prompting the US to accuse it of currency manipulation last week. Devaluation allows China to make its exports cheaper, reducing the impact of tariffs on the goods it sells to Americans. As a side point, it is true to say China has manipulated its currency directly via its vast reserves of foreign currency, but the White House is quite late to the party, and Beijing is intervening far less than it once did.

the tens of billions of dollars that the U.S. is receiving is a gift from China.

Here, Mr Trump seems to be repeating a fallacy he has made before. The US President appears to believe the tariffs he imposed are paid by China itself. This is untrue, as tariffs are actually paid by the importer: in this scenario, US firms.

Prices not up, no inflation.

This is a lie, given the stats that were just released. Year-on-year CPI inflation (at 1.7pc) is below the Feds target, however.

Farmers getting more than China would be spending.

Mr Trump is suggesting here that relief measures introduced by his administration (and funded, he claims, by tariffs)to counterbalance the impact of tariffs on US farmers (who are being outcompeted by Chinese rivals)means they are doing better than they would if there were no tariffs. Analysis of the payments suggests that is not true.

Fake News wont report!

I tried my best!
1:49PM
US inflation rises
Consumer Price Index inflation in the US rose 0.3pc month-on-month, according to data from the Bureau of Labor Statistics.
Thats in line with expectations, and can be added to reasons not to cut interest rates pile at the Federal Reserve.
The growth was underpinned by higher fuel prices and rental costs, and means core inflation is at a six-month high.
BREAKING! US headline and core #inflation higher than expected. Headline 1.8%, core 2.2%, no real need for #FederalReserve rate cuts from this angle. pic.twitter.com/4Ny5JufvVR jeroen blokland (@jsblokland) August 13, 2019
Of course, theres plenty on the other pile as well...
Classic U.S. recession alarm bell about to start ringing ... U.S. 2s/10s yield curve only 5 bps from inverting. Would be first inversion since early 2007, just before the last recession and GFC. Inverted curve has preceded all 5 U.S. recessions since the 1970s. pic.twitter.com/r6OEHuW25r Jamie McGeever (@ReutersJamie) August 13, 2019
1:38PM
Crashed out: How no-deal could impact the UKs automotive industry
US stocks surge after White House delays key tariffs on China

Workers assembles Jaguar vehicles in Castle Bromwich

Credit:
Simon Dawson/Bloomberg
As part of a new series,Telegraphindustry editor Alan Toveyhas examined the impact a no-deal Brexit would have on Britains automotive sector. He writes:

The industry which employs 186,000 people directly in manufacturing and856,000 across the wider automotive sectorhas been one of the most vocal in warning about the problems posed by Britain quitting the EU without a trade deal.
?As that eventuality now looks increasingly likely, what does the future hold for the countrys automotive sector?
You can the first article in the series here:How a no-deal Brexit could mean death by a thousand cutsfor the UKs car industry
The scale of the UK car industry
12:49PM
Fresnillo shines again as gold rush continues
US stocks surge after White House delays key tariffs on China

Gold is seen as a safe asset in times of economic uncertainty

Credit:
The Royal Mint/PA
As gold continues to make gains from global markets confidence crisis hitting a fresh six-year high of $1,535.14 earlier gold miner Fresnillo is once again reaping the rewards on the stock exchange, leading risers currently.
Thats not enough to offset a longer-term decline, however, and Fresnillo is one of the FTSE 100s worst-performing stocks so far this year.
How high can gold push gains?Oandas Craig Erlam says its price is heading towards turnaround territory, as it inches ever-closer to highsreached in 2013:

As ever, the winner in all of this turmoil is gold which is benefiting from its role as a safe haven. Everything is lining up nicely for the yellow metal, whether it be negative bonds yields, risk-aversion, a softer dollar or central bank easing. We're now clear above $1,500 and into the area between $1,520 and $1,560 which was previously a pivotal area for gold.
Momentum remains with the rally as it continues to tear higher, extending its gains to more than 20% since the end of May. It will be interesting to see if this continues to be the case or whether history will repeat itself and profit taking kicks in.
12:24PM
NMC Health leads FTSE fallers
US stocks surge after White House delays key tariffs on China

The Abu Dhabi skyline (photo from 2016)

Credit:
ANDY HASLAM/NYTNS / Redux / eyevine
Fourth-fifths of FTSE 100 stocks are in the red today, with consumer goods companies and industrials weighing most heavily.
NMC Health is the biggest faller, re-taking itsincreasingly-common spot at the bottom of the blue-chip movers.
The Abu Dhabi-based hospital operator and healthcare provider is now 56pc down from its all-time high last September, and down nearly 30pc on the month.
It took a sharp hit last week after apparently being misidentified as the target ofa highly-anticipated short seller attack, of which Burford Capital was the actual victim, and has continued to slide since then. The drop has continued despite an upbeat Barclays note last week that said the stocks fundamentals are robust.
11:57AM
Update: Some departing flights still running in Hong Kong
Hong Kong airport has now altered its official statement, and now says that some outbound flights are still in operation despite protests. Its website, which previously said all departure flights have been cancelled), nowsays (my emphasis):

Terminal operations at Hong Kong International Airport have been seriously disrupted, and all check-in processes have now been suspended. All passengers are advised to leave the terminal buildings as soon as possible. Affected passengers please contact their respective airlines for flight arrangement.

The Wall Street Journals Mike Bird is among those at the airport:
A bird's eye view. Hasn't taken many to shut the entire thing down. No police here, many tourists clearly not following instructions to leave. pic.twitter.com/GUjC4x8Nq4 Mike Bird (@Birdyword) August 13, 2019
11:46AM
Full report: Hong Kong airport closed for second day as protests roll on
US stocks surge after White House delays key tariffs on China

A passenger stands with his luggage as demonstrators gather

Credit:
Kyle Lam/Bloomberg
Speaking of Hong Kongs stock woes, heres our full report on the situation at its airport:
Hong Kong airport cancels all flights as Carrie Lam warns of path of no return
11:41AM
Wage data does little for ailing pound
A significant bounce was too much to hope for, but it looks like the pound is barely shifting at all based on this mornings better-than-expected wage growth figures sat pretty flat on the day.
The FTSE is looking even less happy, roughly finding parity with other European blue-chips at about 0.5pc down. The exception is Germanys DAX, which is now off about 1pc.As of about 15 minutes ago:
The FTSE 100 was 0.54pc down at 7,193.65
Frances CAC 40 was 0.53pc downat 5,281.84
Germanys DAX was down 0.93pc at 11,571.33
Spains IBEX was down 0.56pc at 8,627.9
Italys FTSE MiB was down 0.59pc at 20,144.61
The days biggest loser so far in Hong Kongs Hang Seng Index after falling 2.1pc in the most-recent session, the bourse is now below where it started the year.
11:25AM
Full report: Wages keep rising in tight UK job market
Heres our full report on this mornings labour figures, by Telegraph deputy economics editor Tim Wallace:
Employment jumps and wages surge as jobs market defies economic slowdown
11:14AM
German investor outlook figures dreadful
US stocks surge after White House delays key tariffs on China

A Volkswagon employee

Credit:
FILIP SINGER/EPA
Heres more on the ZEW expecations index on German economic sentiment, published this morning. Pantheon MacroeconomicssClaus Vistesen writes:

This is a dreadful headline, similar to the depths reached during the financial crisis in 2008 and in late 2011, when the U.S. debt ceiling crisis roiled markets. On this occasion, however, it seems as if investors are anticipating chaos a US-Sino currency war, Brexit etcor at least ascribing a very high probability to an accident. In other words, there is little current justification in the equity market, which is usually the best short-term gauge for the ZEW, for this crash.
As anticipation builds for tomorrows German GDP data, INGsCarsten Brzeski has focused on the countrys car industry. He writes:

The German economy appears to be stuck between solid domestic fundamentals and external risks. The industrial slowdown is beginning to have an impact on the domestic economy while the entire economy seems to be flirting with recession...
So, we think the current crumbling of the Chinese car market appears to be a simultaneous combination of cyclical factors, one-off effects and structural changes.
And for the German economy, it's not actually the trade conflict which is most concerning but the structural shifts in the Chinese automotive market, which could turn out to be one of the biggest threat in the years ahead.
10:42AM
Round-up: High street retailers beg for relief, Plus500 profits fall and Next boss downplays no-deal dangers
US stocks surge after White House delays key tariffs on China

Lord Wolfson, boss of Next

Credit:
Next Plc
With that flurry of economic data behind us, here are some of the biggest stories from this morning:
Stop killing the high street: big retailers and small businesses beg politicians for tax relief:Surging wages and bumper tax bills are killing the high street, threatening jobs and crushing investment, according to two of the countrys biggest business groups.
Plus500 profits knocked by spread betting crackdown and stable markets:Spread betting firm Plus500 suffered a precipitous slump in revenues and profits in the first six months of the year as a lack of volatility in markets and a regulatory crackdown on its products hit home.
Next boss Lord Wolfson says no-deal Brexit would not lead to disorder and chaos:Next boss Lord Simon Wolfson has said that no-deal contingency planning by Boris Johnsons government means the UK will not suffer disorder and chaos if it fails to secure a Brexit deal with the EU.
10:36AM
Hong Kong flights suspended for second day
Flights to and from Hong Kongs international airport have been suspended for a second day, according to multiple reports.
Hong Kong Protesters Overwhelm Airport for Second Day https://t.co/Q3F8eUsfdf Mike Bird (@Birdyword) August 13, 2019
*CATHAY PACIFIC SUSPENDS ALL CHECK-INS DUE TO AIRPORT PROTESTS https://t.co/WyXHhYIS0j Joe Weisenthal (@TheStalwart) August 13, 2019
10:30AM
Rudd welcomes labour market data
MP Amber Rudd, who is nowSecretary of State for Work and Pensions and Minister for Women and Equalities, welcomed this mornings labour market figures on Twitter:
NEW

? Highest rate of women in work.

? Continuing record high employment with 115,000 more people in work.

? Wages up year on year, outstripping inflation.

? More people in work means more people in the UK are earning a secure income and have more money in their pockets. https://t.co/gNdXtHZneg Amber Rudd MP (@AmberRuddHR) August 13, 2019
10:25AM
Productivity slips as businesses wait for greater clarity on Brexit
Other data released by the Office for National Statistics shows the UKs productivity dropped by 0.6pc during the second quarter (April to June), compared to the same period last year.

US stocks surge after White House delays key tariffs on China

NB: GVA means grossvalue added a measure of production per hour worked.
The ONS highlighted the slow recovery UK productivity has seen since the financial crisis a decade ago:

Both employment which captures the total number of people in work and total hours which captures both changes in employment and working patterns fell in the course of the economic downturn, though total hours fell further reflecting a fall in the average hours of those in employment.
However, GDP fell by a larger proportion in the economic downturn than either hours or employment and has grown slowly by historical standards during the recovery. In consequence, productivity growth has been subdued since the downturn and has recovered more slowly compared with previous downturns.

Reacting to the productivity stats and labour data, PwC Economist John Hawksworth said the figures show Brexit doubt is weighing on investment:

There are increasing signs that the tight labour market is feeding through to higher earnings, with regular weekly pay growth picking up to almost 4pc in the second quarter - the highest growth rate since before the financial crisis. This will continue to support consumer spending, which has been the main thing keeping the UK economy afloat over the past six months in the face of ongoing Brexit-related uncertainty and a slowing global economy.
The flip-side of strong jobs growth, however, is that productivity growth remains very weak. Output per hour was down by 0.6pc in the second quarter of 2019 compared to the same quarter in 2018. Weak productivity growth reflects subdued corporate investment growth over the past three years as businesses wait for greater clarity on Brexit.

Pawel Adrjan, economist at job site Indeed, said:

This is far from a perfect jobs report. Employer caution is limiting the supply of new vacancies, yet stiff competition for recruits is still driving up wages. Given the wider slowdown in the economy, the labour market is holding up surprisingly well for now. But continued falls in vacancies suggest employers are mindful of the broader economic and political risks on the horizon.
10:15AM
German investor confidence plummets to eight-year low
Investor confidence in Germans economy fell for the fourth month in a row, according to data from the ZEW index.
A gauge measuring economic expectations for the next six months dropped to minus 44.1, the wortst reading since 2011.
There are wide expectations that Germanys may have contracted during the second quarter, with Europes largest economy set to report GDP figures tomorrow.
ZEWs president, Achim Wambach, said:

The most recent escalation in the trade dispute between the USand China, the risk of competitive devaluations, and the increased likelihood of a no-deal Brexit place additional pressure on the already weak economic growth
Ouch! German ZEW survey for Aug was even worse than already low expectations. Current situation index fell to -14.5 vs -6.3 exp, but more worryingly, Expectations index fell to -44.1 vs -28.0 exp, lowest since 2011 when the Eurozone debt crisis dampened the mood of investors. pic.twitter.com/RF6Yg5kyJM Holger Zschaepitz (@Schuldensuehner) August 13, 2019
Ugly sentiment number... https://t.co/Ufpq1o5YUz Michael Hewson ?? (@mhewson_CMC) August 13, 2019
10:08AM
Reaction: Will tight labour market stay the Bank of Englands hand?
US stocks surge after White House delays key tariffs on China

The Bank of England

Credit:
Yui Mok/PA
Todays data presents something of a conundrum for the Bank of England. A tight labour market with rising wages suggests theres little need for stimulus from Britains central bank, but it is increasingly appears at odds with the wider health of the UK economy. Heres how analysts are reacting this morning.
Monex EuropesRanko Berich said:

Junes jobs report features a beat in wage growth combined with job creation thats almost double expectations - in normal circumstances youd expect sterling to rally on these figures. But the pound remains hobbled by no deal risk, and youd practically need a microscope to see sterlings appreciation this morning. Labour market data is also a lagging indicator, while forward indicators such as surveys indicate the economy is slowing and remains vulnerable to further shocks.
The takeaway from this report should be that there is a very strong case for sterling strength once Brexit is resolved. Rising wages should drive sustained consumption growth, which combined with recovering investment should require the BoE to eventually raise rates.
The 115,000 rise in employment in Q2 suggests the labour market shrugged off the 0.2% fall in GDP and supports our view that the economy will recover in Q3. Granted, the unemployment rate rose from 3.8% to 3.9%, but that was the only blemish on an otherwise solid set of figures. Capital Economics UK (@CapEconUK) August 13, 2019
The Institute of Directors chief economist Tej Parikh said:

The jobs market remains a source of strength for the UK economy, though it may now be reaching its peak.
High employment has proved a lifeline for the economy in a difficult period. With so many people in work, solid household incomes have kept consumer spending fairly buoyant while the production and construction sectors have waned...
...Impressive jobs market data should not lull policymakers into a false sense of confidence. As it becomes harder to find talent, businesses will need better access to training courses and a flexible immigration system to meet their skill needs.
9:58AM
ONS: Average real pay per week is ?469
The Office for National Statistics earnings estimates put the average pay per week in real terms for British workers at ?469. Its full labour market report says:

For June 2019, average regular pay, before tax and other deductions, for employees in Great Britain was estimated at:
?505 per week in nominal terms
?469 per week in real terms (constant 2015 prices), higher than the estimate for a year earlier (?460 per week), but ?4 (0.8%) lower than the pre-recession peak of ?473 per week for April 2008
The equivalent figures for total pay are ?499 per week in June 2019 and ?525 in February 2008, a 5.0% difference.
US stocks surge after White House delays key tariffs on China

9:46AM
Earnings remains below post-crisis levels once inflation is factored in
The Office for National Statistics tweets...
Employees earnings are still lower than before the 20082009 downturn, after taking inflation into account https://t.co/SaOrlRozD2 pic.twitter.com/eXPrG4uVil Office for National Statistics (@ONS) August 13, 2019
9:44AM
Snap take: Employment rate for women hits record high as wages grow at fastest rate for 11 years
US stocks surge after White House delays key tariffs on China

The employment rate for women has hit an all-time high, as statistics showed UK employment figures rose and wages grew at their fastest rate in 11 years even though unemployment also slightly ticked up.
Between April and June this year, 72.1pc of women reported being in employment, the highest figure since comparable records began.
Basic pay (excluding bonuses) climbed by 3.9pc during the quarter, meaning the Brexit uncertainty weighing on Britains economy more widely hasnt had a widespread impact on workers wages. Total pay (which includes bonuses) also grew at its quickest rate since 2008., up 3.7pc.
Unemployment hit 3.9pc, bucking expectations it would remain at 3.8pc, but is still near historic lows.
The ONS adds, on the contentious topic of zero-hour contracts:

There were an estimated 896,000 people (not seasonally adjusted) in employment on zero-hour contracts in their main job, 115,000 more than for a year earlier, but 8,000 fewer than the same period in 2016. This represents 2.7% of all people in employment for April to June 2019.
9:31AM
Breaking: Wage growth stronger than expected as unemployment rises
UK labour stats for the second quarter have just been released.
Unemployment rose to 3.9pc from 3.8pc
Wage growth rose to 3.9pc from 3.6pc
9:28AM
Gold returns to pushing six-year high as markets lean away from risk again
Events in Argentina and Hong Kong have been enough to push traders back towards safe havens, pushing gold solidly back over $1,500 an ounce to a six-year high of $1,527.28. The precious metal has been testing price ceilings repeatedly in recent weeks, as investors scramble for ways to shield their money.
As has been the trend for most of this year, that rush for shelter have sent many traders to the bond market, where heightened demand is sending many government debt bundles to offer negative rates of return.
Read more:Slide in bond yields deepens fears of worldwide recession
This morning, consumer staples company Nestles 10-year bond went negative, becoming the firsteuro corporate bond to do so.
Meanwhile, European equities are all looking a little off-colour, with falls of 0.3pc to 0.7pc across the continents blue-chips, led by Italys FTSE MiB
Markets.coms Neil Wilson said:

Equity indices have taken fright on a mix of factors, but chiefly I would say for the US at least it is the persistent damage being done to the global economy from trade disputes. Overnight Singapore cut its growth estimates for the year drastically because of US-China trade strife and a slowdown in the global electronics cycle, which has traders worried about the read across for other Asian economies.
9:12AM
Path ahead for pound will still be very tricky even if wage growth impresses
The pound is trading narrowly stronger against the euro today, and is 0.1pc down against the US dollar, as a broad sterling slide continues.
ING analysts say any one-day gains for the pound are likely to be quickly lostas Brexit uncertainty continues to drag on the currency. They write:

While the June UK wage growth may well hit another post-crisis high, any spill over into the market expectations of the BoE policy stance should be fairly non-existent as the Brexit uncertainty takes precedence over the monetary policy outlook. We view any days of GBP strength as a fade (such as yesterday) and see more sterling weakness ahead as we get closer to potential early elections , a road to which will still be very tricky and characterised by hard Brexit risks.
8:53AM
UK labour data could give pound a lift
US stocks surge after White House delays key tariffs on China

Will narrowing job openings translate into higher pay for workers?

Credit:
Dominic Lipinski/PA
It is set on paper, at least to be another fairly quiet day today, with political factors remaining the biggest influence on the markets as disruption in Hong Kong, political fear in Argentina, and the usual gruesome twosome of Brexit and trade war worries.
The summers lower levels of market liquidity (i.e., how much money is being chucked around) mean movements can tend tobe more exaggerated, increasingly the overall impression of sensitivity.
UK unemployment data, released in just under forty minutes, is unusual in that it is expected to be fairly upbeat, following a long period of strong unemployment stats in Britain.
Unemployment is expected to remain at its 40-year low of 3.8pc, despite data on from Friday that showed the UK economy shrunk during the second quarter of the year, its first contraction since 2012.
Basic wage growth is expected to have hit 3.8pc in the second quarter (from April to June) according to a Bloomberg survey of economists and forecasters, up from a 3.6pc rise between January and March.
Economist Craig Erlam, from trading platform Oanda, says:

There may be a rare piece of good news today though as the labour market data is released. This has been a constant source of positive news for the economy and forecasts today suggest there could be more of the same...
...Whether it will be enough to lift a currency that's mired in doom and gloom Brexit headlines is another thing. Of course, a shock weak report could deliver another blow to the pound and knock it below the psychologically-important 1.20 level.
8:25AM
Agenda: UK prepares for unemployment data as political worries move markets
US stocks surge after White House delays key tariffs on China

Argentinians walk past a street sign displaying the performance of the peso against the United States dollar

Credit:
Ricardo Ceppi/Getty Images South America
Good morning. Markets will likely be weighed down today amid fears about a drawn out trade war between the US and China, protests in Hong Kong and a crash in Argentina'spesocurrency.
All eyes will also be onthe pound, which rebounded yesterday following a plunge toa 10-year low against the euro on a no-deal Brexit warning. UK employment data released today may push the currency to fresh wobbles.

Five things to start your day


1) Traders have increased short bets against the pound to the highest level in more than two years as the currency continues to decline.
2) The financial watchdog is looking into last weeks bear attack on litigation funder Burford Capital by US short seller Muddy Waters.
Burford vs Muddy
3) Britons dont seem to realise theyve never had it so good.New statistics suggestfamilies are becoming better off as ultra-low unemployment and rising wages boost their finances but people are growing more pessimistic about the economy.
Individuals generally feel better off financially, even as they worry more about the economy
4) M&C Saatchi, the advertising agency group best known for its work on Conservative campaigns, has been punished by investors after admitting failings in its accounting had triggered a one-off charge of ?6.4m.
5) And airline Cathay Pacific has threatened to sack staff who take part in the Hong Kong protests, bowing to demands ofChinas aviation regulator.All flights out were suspended on Monday after thousands of protesters chanting fight with Hong Kong, fight for freedom descended on the terminal.

What happened overnight


Markets retreated in Asia on Tuesday as uncertainty over the China-US trade talks was compounded by increasing tensions in Hong Kong and the fallout of shockprimary election results in Argentina.
Hong Kong fell 1.5pc in the morning session while Shanghai shed 0.7pc by lunch.
In Japan,the benchmark Nikkei-225 index lost 1.11pc, falling 229.38 points to 20,455.44, while the broader Topix index fell 1.15pc or 17.27 points to 1,486.57.
CathayPacific, which on Monday tumbled to its lowest levels in a decade after drawing Chinas wrath over Hong Kong protests, fell as much as 5.4pc.

Coming up today


UK data on jobless claims, wages and the unemployment rate are the days big releases.
If the employment figures follow the pattern of recent releases, they should prompt a fairly typical response: The Government is likely to welcome an apparently-strong jobs market, while critics will (rightly or wrongly) suggest that Britain's unemployment rate, which hit a 45-year low in May, is underpinned by gig economy jobs and zero-hours contracts.
A post-Brexit delay slowdown might results in slightly worse figures.
Interim results:IFG Group, John Menzies, JPJ Group, Mears Group, Polypipe Group
Trading update:Card Factory, Volution Group
Economics: Jobless claims, wages and unemployment rate (UK), Consumer Price Index (US)
See also:
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