Turkey’s central bank managed to calm down the currency markets for the time being by committing to provide liquidity for the embattled Turkish lira and the currency’s two day free fall has finally slowed down. The lira even managed to claw back some lost ground, trading 6% higher against the dollar this morning, allowing stock and commodity markets to recover.
The FTSE is trading up 0.27% as the lira fear factor has declined and the DAX is up 0.67%, helped by German economic data which showed that growth in Europe’s largest economy sped up in the second quarter, outpacing the rest of the Eurozone. Germany’s annualized GDP growth is now at 1.8% compared with the Eurozone’s 1.5%.
The pound and the euro are both looking a little healthier this morning with sterling trading 0.26% higher against the dollar and up 0.24% against the euro.
While the immediate fire of the Turkish lira has simmered down, other tinder is starting to cause concerns for stock markets. Chinese economic data including retail sales, industrial output and urban investment were all reported at a lower level than forecast in July, causing Shanghai stocks to dip 0.9%. Lower Chinese numbers will be a cause of concern for many commodity markets because a slowdown in the Chinese economy will dampen demand for key commodities such as oil, metals and agricultural goods.
Saudi cuts oil output, boosts prices
Oil cartel OPEC is already taking into account that China might require less oil next year and has revised downward its expectations for crude oil demand in 2019. The group’s largest member Saudi Arabia has pumped out less oil in July trying to avoid a situation in which oversupply knocks down oil prices. The market reacted promptly with Brent Crude trading up 0.77% and West Texas Intermediate 0.91% higher.
Mears sees improvement in aged care business
Mears is on a more solid footing these days, as cost savings and a fresh focus on better quality contracts start to bear fruit.
Revenue in the housing division is indeed recovering after the Grenfell disaster in June last year slowed demand. The bid pipeline, at £2.8bn, is considerably higher than the £2.0bn estimate given at the last results release.
The highlight of this result, though, is the improvement in the aged care business. Revenue has fallen sharply but the unit has stormed back into the black with a commendable turnaround in its margin performance.
Mears is clearly applyingmore discipline when bidding for contracts, setting it up for what should be a stronger performance in the second half of the year compared to the first.
Tough trading conditions hurting Marshall Motors
Splashing out on a new set of wheels doesn't seem like a particularly wise decision when your pay isn't going up by much and the economic outlook remains foggy.
The government's regulatory assault on diesel cars is adding an extra layer of uncertainty to purchasing decisions, for vehicles both old and new.
Such tough trading conditions are hurting car dealers across the UK and Marshall Motor is no exception.
Sales of new and used cars at its dealerships have both fallen, though it's encouraging to see it's still been able to eke out a small rise in underlying profit and kept its operating margins intact.
With its debt load now completely wiped out, Marshall is in pole position to prey on rivals that aren't coping with the downturn so well.
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