Author: The Telegraph

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Business

China stocks suffer worst day in four years as ‘fragile’ recovery exposed Business

Oil prices have moved higher after Iran sent a warship into the Red Sea in response to the sinking of three ships by the US Navy.

Iran despatched its Alborz destroyer on Monday after the sinking of three Houthi boats over the weekend in the vital trade route, which is being avoided by shipping companies after a series of attacks.

5 things to start your day 

1) Hedge funds stockpile uranium as price of nuclear fuel surges | Up to 50 firms are believed to have bought ‘yellowcake’ amid huge global supply deficit

2) Britain cracks down on semiconductor sales to China | Western countries continue to restrict Beijing’s access to advanced microchips

3) Investors lose £7bn on British banks despite rising interest rates | Barclays, NatWest, Virgin Money and Metro shares all failed to make gains since January

4) Falling food inflation at risk from looming cost pressures | ‘Obstacles on the road’ threaten to stoke price rises in 2024, warn retail bosses

5) Defence company founded by Oculus creator plans to double UK presence | Anduril bets on a boom in Britain’s aerospace technology

What happened overnight 

Asian markets slipped as traders returned from the New Year break. 

Wall Street had ticked lower on the last trading day of 2023 and the Hang Seng index in Hong Kong began 2024 by sinking 1.5pc to 16,800.73.

The Shanghai Composite index dropped 0.2pc to 2,968.81. Japan’s markets were closed for a holiday.

Investors were selling property developers like debt-laden China Evergrande, which fell 6pc, and LongFor Group Holding, which lost 5.7pc.

The December survey of the official purchasing managers index, or PMI, in China fell to 49 for the third consecutive month, signalling weak demand and underscoring the challenging economic conditions in the world’s second-largest economy.

That contrasted private-sector survey, by financial publication Caixin, which registered a slight improvement in the manufacturing PMI to 50.8, driven by increased output and new orders. However, it showed that business confidence for 2024 remained subdued.

South Korea’s Kospi shed 0.2pc to 2,651.34 and the S&P/ASX 200 in Australia rose 0.5pc to 7,625.60.

Bangkok’s SET rose 0.2pc and the Sensex in Mumbai climbed less than 0.1pc.

Stocks fell Friday on Wall Street from their near all-time high amid easing inflation, a resilient economy and the prospect of lower interest rates which buoyed investors.

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Source: www.telegraph.co.uk
This notice was published: 2024-01-02 09:12:39

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Business

Hunt contacts Thames Water chief after outage leaves Chancellor ‘beside myself with frustration’ Business

Mr Hunt called for a water pumping station to be installed to ensure residents can access fresh water and said Thames should also consider giving out bottles of water.

Mr Hunt wrote on X, formerly known as Twitter: “I know many of you are hosting friends and family and this water outage is hugely inconvenient.”

Following Mr Hunt’s intervention, Alastair Cochran, Thames Water’s co-chief executive, said: “I’m really sorry if you’re experiencing low pressure or no water – I know how disruptive and inconvenient this can be, especially on Boxing Day.

“Our specialist engineers have now arrived and are working hard to get your water supply back to normal as quickly as possible.”

In response, Mr Hunt said: “I have to say I am beside myself with frustration that this is happening *again* and over Christmas. 

“If this is going to take any time at all we need a water station up and running asap.” 

In November, a similar outage left 12,000 people without fresh water for days on end. Tankers were deployed to the area to provide supplies. 

The outage comes as Thames Water seeks to raise £2.5bn from investors to shore up its long-term finances. 

Britain’s largest water supplier, which serves around 16 million people in London and the Thames Valley, was plunged into crisis over the summer by the sudden departure of chief executive Sarah Bentley.   

Her exit triggered immediate concerns about the company balance sheet, including its £14.7bn debt pile. 

The company is now trying to convince investors to back its turnaround plans, amid fears that failure to raise the money will lead to its nationalisation. 

Thames attempted to ease fears about its finances by announcing it had raised £500m of “equity” from investors. 

But it later emerged that the money was first provided to the supplier’s parent company, Kemble Water, in the form of a convertible loan with an interest rate of 8pc. 

During a grilling by MPs earlier this month, Mr Cochran admitted that Thames did not currently have enough money to repay a £190m loan due for repayment next April. 

In an attempt to bring its finances back on to a sustainable footing, Thames is seeking to put up customer bills over the next decade.

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Source: www.telegraph.co.uk
This notice was published: 2023-12-26 12:16:25

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Business

Higher energy bills for 7 million even as price cap falls Business

Baroness Ros Altmann, the former pensions minister, said: “Standing charges are really unfair on the poorest and single households.

“The regulator Ofgem has allowed energy firms to increase standing charges to help pay for the cost of failed energy suppliers. This seems to me even more unfair. However much a poor household tries to cook less, bathe less or turn down their heating, they can’t escape the standing charge”

Peter Smith at National Energy Action said: “Despite increased criticism of the impact these fixed charges have, particularly on low-usage households, Ofgem has overseen a rapid increase in standing charges since the price cap was introduced four years ago.”

It comes as Ofgem prepares to announce the new energy price cap, covering October to December, on Friday.

Jonathan Marshall, an economist at the Resolution Foundation, said: “Ofgem is set to announce that the typical household energy bill will fall this winter, but more than one-in-three households across England will be shocked to discover that their energy bills could actually be higher this winter than last winter.”

He added: “Loads of new costs have been bumped on to standing charges, the biggest of which, by far, is the cost of all those suppliers going bust.

“That means standing charges have gone up which is probably not the fairest way of apportioning those costs.”

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Source: www.telegraph.co.uk
This notice was published: 2023-08-24 05:00:00

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Business

German property prices plummet as housing bubble bursts Business

Thanks for joining me. Britain is at risk of a recession after revisions to official data showed the economy shrank in the third quarter.

The Office for National Statistics said GDP slumped by 0.1pc in the three months to September. 

Two consecutive quarters of contractions are defined as a technical recession. The UK began the fourth quarter with a 0.3pc contraction in October.

5 things to start your day 

1) Hunt hints at spring tax cuts if Britain’s debt bill falls | Economists expect the Chancellor to have over £10bn of fiscal wiggle room

2) The war on landlords has backfired – and Britons are paying the price | Nation’s animosity towards the ‘bogeymen of modern times’ has reached a breaking point

3) Paramount heiress prepares to bow out as Hollywood streaming wars turn ugly | Billionaire tycoon speculated to be exploring selling 77pc stake of controlling shares

4) China blocks exports of rare earth technology after MPs warn Beijing is ‘weaponising’ supplies | Move follows Western efforts to restrict the country’s access to microchip technology

5) Patrick Minford: The Laffer Curve is about to blow up the SNP | Decision to introduce 48pc top tax rate is only going to bring in modest amounts

What happened overnight 

Shares were mostly higher in Asia after several strong profit reports helped Wall Street claw back most of its sharp loss from day before.

Japan’s core inflation rate fell to 2.5pc in November from 2.9pc a month earlier as energy costs eased. The decline might counter expectations that the central bank will tighten its lax monetary policy in coming months.

Bank of Japan officials have indicated they want to ensure inflation is sustained near the 2pc target level and that wages are also rising before adjusting the central bank’s longstanding minus 0.1pc benchmark interest rate.

Tokyo stocks trimmed early gains and closed only marginally higher as markets overseas move into the holiday season.

The benchmark Nikkei 225 index edged up 0.1pc, or 28.58 points, to end at 33,169.05, while the broader Topix index added 0.5pc, or 10.45 points, to 2,336.43.

The Kospi in Seoul added 0.4pc to 2,609.54. Hong Kong’s Hang Seng index gave up 0.4pc to 16,548.98 and the Shanghai Composite index was up 0.5pc at 2,933.25. In Sydney, the S&P/ASX 200 picked up 0.1pc to 7,510.90.

Bangkok’s SET slipped 0.3pc and the Sensex in Mumbai was up 0.3pc.

Wall Street shares resumed their upward climb on Thursday. The Dow Jones Industrial Average of 30 leading American companies closed up 0.9pc at 37,404.35 points, while the broader S&P 500 index was up 1pc at 4,746.75. Meanwhile, the Nasdaq Composite index, which is skewed towards technology shares, was up 1.3pc at 14,963.87.

The yield on benchmark 10-year US Treasury bonds was up 1.5 basis points to 3.892pc, from 3.877pc late on Wednesday.

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Source: www.telegraph.co.uk
This notice was published: 2023-12-22 08:25:48

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Business

Britain’s debt interest payments hit record high for November Business

Thanks for joining me. Public sector borrowing was more than expected in November and ahead of last year in a blow to the Chancellor’s ambitions to cut taxes.

Public sector net borrowing excluding banks was £24.4bn higher in the eight months to November than over the same period last year, standing at £116.4bn.

For the month of November, total Treasury borrowing excluding public sector banks was £14.3bn, ahead of economists expectations of £13bn.

5 things to start your day 

1) Warner Bros and Paramount plot £30bn Hollywood megamerger | Warner would be expected to dominate the merged business

2) Investors bet rates could start falling by March after surprise drop in inflation | Lower fuel prices and easing food costs helped CPI fall to 3.9pc in November

3) BT scrambles to rip out Huawei tech ahead of New Year’s Eve deadline | Telecoms giant risks hefty fine if it fails to remove kit from ‘core’ networks by Dec 31

4) More lorries to clog motorways after rail freight plans scaled back | Ministers reject move that could have taken 20m lorry journeys off roads

5) Tom Stevenson: My prediction for 2024 is that the FTSE 100 will boom | Recession could arrive in 2024 but with luck, any downturn will be shallow

What happened overnight 

Asian shares retreated after Wall Street snapped a long winning streak, while US Treasury yields were near five-month lows amid hopes that Britain’s sharp fall in inflation would be echoed in looming American price data.

Tokyo stocks closed lower after Toyota announced a recall of a million vehicles, and its subsidiary Daihatsu decided to suspend shipments of all models over rigged safety tests.

The benchmark Nikkei 225 index lost 1.6pc, or 535.47 points, to end at 33,140.47, while the broader Topix index fell 1pc, or 23.40 points, to 2,325.98.

Australian shares were down 0.4pc, while China’s blue-chip CSI300 index remained flat. It is on track for a sixth straight weekly loss, which could be its worst weekly performance in 12 years and a record fifth consecutive monthly loss.

Wall Street shares were down on Wednesday after rises fuelled last week by the US Fed chair Jerome Powell, who indicated that interest rate cuts should materialise next week. 

The Dow Jones Industrial Average of 30 leading US companies was down 1.3pc at 37,082.00, while the S&P 500 declined 1.5pc to close at 4,698.35. The Nasdaq Composite index was down 1.5pc at 14,777.94.

Yields of US Treasury bonds have been dropping since late October on hopes of interest rate cuts, and they fell again following encouraging UK inflation data. The yield on benchmark 10-year Treasury bonds dropped to 3.85pc from 3.93pc late on Tuesday.

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Source: www.telegraph.co.uk
This notice was published: 2023-12-21 09:01:07

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Business

FTSE 100 leaps higher as markets bet on interest rate cuts Business

Thanks for joining me. Money markets and analysts will shortly deliver their reaction to official data showing inflation fell more than expected to 3.9pc in November.

The reading comes as financial markets had hoped a falling inflation picture would lead to just over four reductions in interest rates next year from their present level of 5.25pc, starting by May.

We will have everything you need to know in the live blog.

5 things to start your day 

1) Softbank and Arm chiefs meet Hunt as City reforms open door to secondary listing in London | The Financial Conduct Authority has unveiled proposals to streamline London’s listing regime to attract secondary listings

2) Care companies at fault in digital landline crisis, claims Virgin Media O2 | As phone lines are updated, local authorities need to step up

3) Scottish battery factory goes bust in fresh blow to UK’s net zero industry | AMTE Power has seen its finances tip into the red due to a lack of orders and investment

4) Debt-laden Asda’s interest bill to surge above £400m | Issa brothers scramble to sell off assets in order to pay down borrowings

5) Matthew Lesh (IEA): Britain’s only growth area is regulation and red tape | Our economic prospects are under serious threat – it’s time to rein in the regulators

What happened overnight 

Asian shares mostly advanced amid hopes that Japan’s moves to keep interest rates easy for investors could augur similar trends in the rest of the world.

Oil prices were virtually unchanged after two days of gains.

Building on gains from Tuesday, Tokyo stocks closed higher as they were helped by a relatively cheaper yen against the dollar after the Bank of Japan indicated it plans to keep its super-loose monetary policy in place.

The benchmark Nikkei 225 index advanced 1.4pc, or 456.55 points, to 33,675.94, while the broader Topix index ended up 0.7pc, or 15.57 points, at 2,349.38.

The rises came despite Japan experiencing a slight decline in its export performance for the first time in three months in November, a worrisome slowdown for the world’s third-largest economy.

Exports to China, Japan’s biggest single market, fell 2.2pc, while shipments to the US rose 5.3pc from a year earlier. Total imports fell nearly 12pc.

Hong Kong’s Hang Seng index added 1pc to 16,669.44 while the Shanghai Composite index lost 0.4pc to 2,920.63 after China kept its benchmark lending rates unchanged at the monthly fixing on Wednesday.

The S&P/ASX 200 in Sydney gained 0.6pc to 7,533.90, while South Korea’s Kospi was 1.4pc higher to 2,603.85. Bangkok’s SET rose 0.6pc, and India’s Sensex climbed 0.3pc.

Wall Street extended its rally on Tuesday, advancing as investors looked ahead to crucial inflation data.

The S&P 500 rose 0.6pc and is just shy of its record set nearly two years ago. The Dow Jones Industrial Average of 30 leading US companies gained 0.7pc, and set its own record for a fifth straight day, while the Nasdaq Composite index climbed 0.7pc. 

The yield on benchmark 10-year US Treasuries were down 2.3 basis points to 3.933pc, from 3.956pc late on Monday. 

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Source: www.telegraph.co.uk
This notice was published: 2023-12-20 08:22:44

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Business

Germany shuns Putin as it strikes £43bn gas deal with Norway Business

Britain is at risk of a major economic downturn next year according to one of the world’s biggest active bond fund managers.

Daniel Ivascyn, chief investment officer at Pimco, warned that his company is running larger than usual bets on UK government bonds compared to the US as he expects the British economy to struggle in 2024.

It comes as Britain grapples with interest rates at 15-year highs of 5.25pc, while the Bank of England expects growth to be flat.

“In the case of the UK — a smaller, open economy, with a consumer that’s feeling the brunt of central bank policy far more than their US counterparts — you just have a higher probability of more significant economic deterioration,” Mr Ivascyn told the Financial Times.

“We do think there’s potentially more hard landing risks.”

5 things to start your day 

1) Apple forced to halt US smartwatch sales before Christmas after legal blow | Tech giant loses a patent dispute to Masimo over the gadget’s blood oxygen sensor

2) Audi hits brakes on EV rollout as enthusiasm wanes | Tech giant loses a patent dispute to Masimo over the gadget’s blood oxygen sensor

3) Fears fuel price will jump as BP suspends shipments through Red Sea | Decision to pause operations comes after attacks on cargo ships by Houthi militants

4) CMA branded ‘irrational’ as Adobe abandons $20bn takeover | US tech giant lashes out after monopoly fears force it to call off Figma acquisition

5) Nepo babies at war as billionaires prepare for succession dramas | Bitter feuds over inheritance are set to become much more common among the rich

What happened overnight 

Tokyo stocks closed higher as the yen slipped against the dollar after the Bank of Japan maintained its super-loose monetary policy.

The benchmark Nikkei 225 index rose 1.4pc, or 460.41 points, to 33,219.39, while the broader Topix index added 0.7pc, or 16.95 points, to end at 2,333.81.

The Japanese market started with losses in cautious trade ahead of the BoJ policy decision, as speculation had been swirling for weeks that officials would shift away from negative interest rates and a tight grip on bond yields as inflation picks up.

The Nikkei strengthened in afternoon trade after the central bank announced it was sticking to its easy monetary policy during the midday trading break. The yen slipped against the dollar after the announcement.

Asian shares were mixed elsewhere after a seven-week winning streak on Wall Street slowed down.

The S&P/ASX 200 in Sydney added 0.8pc to 7,486.90, while South Korea’s Kospi was nearly unchanged, at 2,566.30.

Hong Kong’s Hang Seng index declined 0.6pc to 16,527.75 and the Shanghai Composite index fell less than 1 point to 2,930.18.

Bangkok’s SET also was little changed, while Taiwan’s Taiex fell 0.7pc.

The Dow Jones Industrial Average of 30 leading American companies finished essentially flat at 37,306.02. The broader S&P 500 gained 0.5pc, reaching 4,740.56, and the technology-heavy Nasdaq Composite added or 0.6pc to 14,904.81.

Retailers and big technology companies were among the big gainers. Amazon.com rose 2.7pc and Etsy climbed 4.7pc for the biggest gain among S&P 500 stocks. Chipmaker Nvidia rose 2.4pc, while Meta added 2.9pc and Netflix closed 3pc higher.

Benchmark 10-year US Treasury yields were up 1.5 basis points to 3.943pc, from 3.928pc late Friday.

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Source: www.telegraph.co.uk
This notice was published: 2023-12-19 10:27:32

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Business

Burberry hit by slowdown in luxury demand as it issues sales warning Business

Thanks for joining me. Burberry has warned it may not be able to hit this year’s revenue targets as it faces a global slowdown in demand for luxury goods.

The British fashion stalwart said that profits will be at the lower end of expectations amid a “challenging” trading environment.

5 things to start your day 

1) Mortgage rates cut to less than 5 per cent at ‘big six’ banks | Falling inflation raises hopes that the Bank of England will hold interest rates

2) It’s time the Tories started striking some open goals | The Conservative party is trailing in the polls – the Autumn Statement provides a rare opportunity

3) Offshore wind projects to receive subsidies boost after auction flop | Claire Coutinho to announce 70pc increase to guaranteed price offered to developers

4) Boost for Silicon Valley as tech giants granted power to appeal fines | Digital markets bill to be watered down after fierce lobbying

5) More than 1,300 UK jobs at risk after HS2 setback | French manufacturer Alstom may be forced to mothball Britain’s biggest train factory

What happened overnight 

Asian shares have retreated after Wall Street added a bit more to its big rally from the previous day after retail sales and wholesale prices data added to encouraging inflation statistics this week.

Any lift in sentiment from a meeting between Joe Biden and Chinese leader Xi Jinping appeared to fade after the US president, pressed by a reporter on whether he trusted Xi, said he believed in trusting but verifying and conceded that China’s leader is a dictator.

“He is a dictator in a sense,” Biden said.

Biden and Xi emerged from their first face-to-face meeting in a year vowing to stabilise the fraught relationship between the world’s two biggest economies. 

Hong Kong’s Hang Seng lost 1.2pc to 17850.33 and the Shanghai Composite index was down 0.5pc at 3,056.09.

In other Asian trading, Tokyo’s Nikkei 225 shed 0.2pc to 33,445.08 and the Kospi in Seoul edged 0.1pc lower, to 2,486.33.

In Australia, the S&P/ASX 200 sank 0.8pc to 7,051.20.

The S&P 500 was up a whisper (0.2pc) at 4,502.88, while the Dow Jones Industrial Average increased by 0.5pc to 34,991.21 amid rising confidence that the US has got a grip on inflation and that interest rates are likely to fall in 2024. 

The technology-heavy Nasdaq Composite was up 0.1pc to 14,103.84.

Treasury yields rose Wednesday, with the yield on the 10-year Treasury bonds climbing to 4.53pc from 4.45pc.

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Source: www.telegraph.co.uk
This notice was published: 2023-11-16 07:29:01

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Business

Sunak fulfils inflation pledge as rate falls to lowest in two years Business

Thanks for joining me. Inflation has dropped below 5pc for the first time in two years as falling energy prices helped Rishi Sunak meet his target to halve the measure before the end of the year.

The consumer prices index fell to 4.6pc in October, coming in below the Prime Minister’s target of falling below 5.4pc.

5 things to start your day 

1) Central banks will have to slash rates as the world’s fiscal bubble bursts | The main prop of global economic recovery is wobbling

2) The Cassandra warning that central banks are driving the world’s economy off a cliff | Optimism may be short-lived as the scale of interest rates hikes is yet to fully hit

3) Over-65s are stopping young families getting on housing ladder, says Zoopla | Two fifths of older homeowners live in a home that is larger than they need

4) Mortgage price war ramps up as Sunak prepares to claim inflation victory | Major lenders cut fixed-rate deals ahead of critical announcement

5) Selfridges seized by Thai retailer after debt crisis at co-owner | It ends weeks of uncertainty over ownership of the luxury department store

What happened overnight 

Asian shares surged higher as they were cheered by a rally on Wall Street that was one of the best days of the year following a surprisingly encouraging report on inflation.

Tokyo’s benchmark Nikkei 225 rose 2.6pc to 33,545.14 as investors appeared to shrug off news that Japan’s economy contracted at a worse than expected 2.1pc annual rate in July-September.

Hong Kong’s Hang Seng added 3.3pc to 17,971.81, while the Shanghai Composite gained 0.5pc to 3,069.81 after economic data for October showed the Chinese economy is holding up even as some indicators slowed.

Factory output and retail sales rose but property sales fell further. Lending, exports and inflation have also been lower than expected.

Australia’s S&P/ASX 200 jumped 1.4pc to 7,105.90. South Korea’s Kospi surged 1.9pc to 2,480.51.

On Tuesday, the S&P 500 closed up 1.9pc at 4,495.70, while the technology-focused Nasdaq Composite was up 2.4pc to 14,094.38. The Dow Jones Industrial Average rose 1.4pc to 34,827.70.

Meanwhile, US Treasury yields dropped after lower than expected inflation signalled to the market that interest rates might have hit their peak – with expectations of cuts next year. The yield on 10-year Treasuries declined 18 basis points to 4.46pc.

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Source: www.telegraph.co.uk
This notice was published: 2023-11-15 07:01:02

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Business

Wages grow faster than inflation after civil service pay deal Business

Thanks for joining me. Total pay increased at a faster pace than inflation in the three months to September raising fears that interest rates will have to stay higher for longer.

Wages including bonuses rose by 7.9pc, ahead of inflation of 6.7pc, raising the alarm that pay rises could fuel price increases in the economy.

5 things to start your day 

1) Net zero policies are pushing up inflation, says Bank of England rate setter | Households facing costs of climate change policies such as carbon taxes and emissions trading schemes

2) Avon to open shops for first time amid decline in stay-at-home mothers | Beauty giant forced to rethink sales strategy as more women go out to work

3) Google gives Apple 36pc of ad revenue from Safari browser, court hears | World’s most popular search engine accused of paying iPhone maker billions to maintain monopoly

4) Chinese shoppers spend 60pc less in London as calls to drop tourist tax grow | Europe is reaping the benefits of Britain’s tax decision, says business group

5) Treasury to save £4bn with disability benefits overhaul | The reforms aimed at encouraging more people into work may be announced in the Autumn Statement

What happened overnight 

Asian shares were mostly higher ahead of potentially market-moving inflation figures from the US.

Tokyo stocks closed higher, with the benchmark Nikkei 225 index gaining 0.3pc, or 110.82 points, to end at 32,695.93, and the broader Topix index adding 0.4pc, or 8.67 points, to 2,345.29.

The Japanese yen was at 151.71 per dollar in Asian hours, having touched a one-year low of 151.92 on Monday. If the battered currency breaks below last year’s trough of 151.94, it would mark a fresh 33-year low.

Australia’s S&P/ASX 200 advanced 0.6pc to 6,992.10. South Korea’s Kospi added 1.1pc to 2,429.21. 

Hong Kong’s Hang Seng dropped 0.4pc to 17,359.13 while the Shanghai Composite edged less than 0.1pc higher, to 3,047.13.

Wall Street stocks delivered a mixed performance on Monday, with the Dow Jones Industrial Average rising 54.77 points, or 0.2pc, to 34,337.87.

The S&P 500 lost 3.69 points, or 0.1pc to 4,411.55. The Nasdaq Composite dropped 30.37 points, or 0.2pc, to 13,767.74.

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Source: www.telegraph.co.uk
This notice was published: 2023-11-14 07:16:02