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You can find the current article at its original source at https://www.theguardian.com/business/live/2016/may/05/uk-service-sector-report-slowdown-china-stock-markets-business-live
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| UK service sector growth slumps to three-year low – business live | |
| (35 minutes later) | |
| 9.48am BST | |
| 09:48 | |
| CIPS: EU referendum fears are hurting the economy | |
| Britain’s services sector makes up around three-quarters of the economy, so this slowdown is pretty worrying. | |
| David Noble, CEO of the Chartered Institute of Procurement & Supply, says June’s EU referendum is partly to blame. | |
| “The UK’s services sector is stuck between a rock and a hard place. Mounting global economic uncertainty at the top of the supply chain and the reality of the new National Living Wage at the bottom mean that firms are feeling the pinch from both ends. As a result, the sector credited with being the main driver of the UK’s economic fortunes appears to be slowing down. | |
| “The looming EU referendum has had a profound effect on the sector, keeping prices relatively stagnant and delaying new orders. At the other end of the supply chain, the National Living Wage has compounded cost increases, resulting in the overall rate of input price inflation hitting a 27-month high. Together, these factors have squeezed margins while fewer than half of businesses expect to grow over the next twelve months. | |
| Updated | |
| at 9.49am BST | |
| 9.37am BST | |
| 09:37 | |
| Service sector growth hits three years low | |
| Breaking: Britain’s service sector’s growth has slumped to its lowest level in three years. | |
| Markit, the data firm, says its service sector PMI has fallen to 52.3 in April, down from 53.7 in March. | |
| That’s the weakest level since February 2013, and close to the 50-point mark that splits expansion from contraction. | |
| Firms reported that job creation slowed last month, while business optimism has fallen to a three year low too. | |
| This makes a hat-trick of bad UK economic news this week. Construction firms reported yesterday that growth has hit a three-year low, while the factory PMI showed that manufacturing is now contacting. | |
| Chris Williamson, chief economist at Markit, fears that UK economic growth almost stalled last month: | |
| “The slowdown in the service sector follows similar weakness in manufacturing and construction to make a triple-whammy of disappointing news on the health of the economy at the start of the second quarter. | |
| “The PMI surveys are collectively indicating a near- stalling of economic growth, down from 0.4% in the first quarter to just 0.1% in April. | |
| “Some of the slowdown may be attributable to the early timing of Easter, though April also saw an increase in the number of companies reporting that uncertainty about the EU referendum caused customers to hold back on purchases, exacerbating already-weak demand linked to global growth jitters and ongoing government spending cuts. | |
| More to follow.... | |
| Updated | |
| at 9.41am BST | |
| 9.27am BST | |
| 09:27 | |
| Here we go..... Lets see if those forecasts of a small slowdown are accurate. | |
| 5mins to UK services PMI the big news of the day | |
| 9.17am BST | 9.17am BST |
| 09:17 | 09:17 |
| UK services #PMI is due at 9:30 am today and it matters because both manufacturing and construction showed weakness #GBP #BoE | UK services #PMI is due at 9:30 am today and it matters because both manufacturing and construction showed weakness #GBP #BoE |
| 9.13am BST | 9.13am BST |
| 09:13 | 09:13 |
| As well as posting stronger profits, BT has announced a £6bn investment in broadband and 4G coverage: | As well as posting stronger profits, BT has announced a £6bn investment in broadband and 4G coverage: |
| BT to spend £6bn on superfast broadband and 4G rollout as profits boosted by demand for TV & broadband bundles https://t.co/mBinMQlLpT | BT to spend £6bn on superfast broadband and 4G rollout as profits boosted by demand for TV & broadband bundles https://t.co/mBinMQlLpT |
| 9.02am BST | 9.02am BST |
| 09:02 | 09:02 |
| You can now buy shares in Britain’s luxury chocolate firm, Hotel Chocolat. | You can now buy shares in Britain’s luxury chocolate firm, Hotel Chocolat. |
| The company floated on the stock market this morning, raising £20m each for its two founders. The IPO will also yield £12m to fund new store openings, as its expansion drive continues. | The company floated on the stock market this morning, raising £20m each for its two founders. The IPO will also yield £12m to fund new store openings, as its expansion drive continues. |
| Related: Hotel Chocolat founders make £20m each from stock market debut | Related: Hotel Chocolat founders make £20m each from stock market debut |
| 8.41am BST | 8.41am BST |
| 08:41 | 08:41 |
| Trinity Mirror: Print sales slump, New Day closes | Trinity Mirror: Print sales slump, New Day closes |
| Launching a new print newspaper, in this time of digital revolution, was always a risky move. | Launching a new print newspaper, in this time of digital revolution, was always a risky move. |
| So you can understand why Trinity Mirror is pulling its latest offering, The New Day, after seeing sales falling to 30,000. But the speed of the move is a shock – the paper only launched 9 weeks ago. | So you can understand why Trinity Mirror is pulling its latest offering, The New Day, after seeing sales falling to 30,000. But the speed of the move is a shock – the paper only launched 9 weeks ago. |
| The news broke last night (here’s Mark Sweney’s piece), and Trinity has confirmed it to shareholders this morning, saying: | The news broke last night (here’s Mark Sweney’s piece), and Trinity has confirmed it to shareholders this morning, saying: |
| Although The New Day has received many supportive reviews and built a strong following on Facebook, the circulation for the title is below our expectations. | Although The New Day has received many supportive reviews and built a strong following on Facebook, the circulation for the title is below our expectations. |
| As a result, we have decided to close the title on 6 May 2016. Whilst disappointing, the launch and subsequent closure have provided new insights into enhancing our newspapers and a number of these opportunities will be considered over time. | As a result, we have decided to close the title on 6 May 2016. Whilst disappointing, the launch and subsequent closure have provided new insights into enhancing our newspapers and a number of these opportunities will be considered over time. |
| But that’s not the only bad news. Trinity has also revealed that revenues from print advertising has fall almost 20% - highlighting the tough conditions across media.... | But that’s not the only bad news. Trinity has also revealed that revenues from print advertising has fall almost 20% - highlighting the tough conditions across media.... |
| Related: Trinity Mirror reports 19% print ad slide as it confirms the New Day's closure | Related: Trinity Mirror reports 19% print ad slide as it confirms the New Day's closure |
| 8.25am BST | 8.25am BST |
| 08:25 | 08:25 |
| Europe’s stock markets have made a nervous start to trading, after two days of losses. | Europe’s stock markets have made a nervous start to trading, after two days of losses. |
| Britain’s FTSE 100 is up 15 points, or 0.2%, while Germany’s DAX is up 0.3% and the French CAC is flat. | Britain’s FTSE 100 is up 15 points, or 0.2%, while Germany’s DAX is up 0.3% and the French CAC is flat. |
| BT is leading the London risers, up 3%, after reporting a 5% jump in underlying earnings this morning. | BT is leading the London risers, up 3%, after reporting a 5% jump in underlying earnings this morning. |
| Supermarket group Morrisons has gained 1.7%; after a troubled time, it posted a 0.7% rise in underlying sales this morning. It also reported that Amazon is about to start supplying its customers with Morrisons’ products, though a deal announced recently. | Supermarket group Morrisons has gained 1.7%; after a troubled time, it posted a 0.7% rise in underlying sales this morning. It also reported that Amazon is about to start supplying its customers with Morrisons’ products, though a deal announced recently. |
| Energy firm Centrica, though, has slumped by 7% after it announced plans to sell around £770m of new shares to cut its debt pile. | Energy firm Centrica, though, has slumped by 7% after it announced plans to sell around £770m of new shares to cut its debt pile. |
| 8.11am BST | 8.11am BST |
| 08:11 | 08:11 |
| Turkish market hit by political crisis | Turkish market hit by political crisis |
| Turkey’s stock markets has plunged by 2% at the start of trading, as investors react to the country’s latest political crisis. | Turkey’s stock markets has plunged by 2% at the start of trading, as investors react to the country’s latest political crisis. |
| Investors are alarmed by reports that prime minister Ahmet Davutoğlo is poised to resign, following a power struggle with president Recep Tayyip Erdoğan. | Investors are alarmed by reports that prime minister Ahmet Davutoğlo is poised to resign, following a power struggle with president Recep Tayyip Erdoğan. |
| The Turkish lira is also suffering, shedding 5% overnight. | The Turkish lira is also suffering, shedding 5% overnight. |
| Turkish Lira Hanging in There After Biggest Decline in 5 Years Amid Political Turmoil #fx #Turkey pic.twitter.com/50NnlJKNef | Turkish Lira Hanging in There After Biggest Decline in 5 Years Amid Political Turmoil #fx #Turkey pic.twitter.com/50NnlJKNef |
| Davutoğlo and Erdoğan held crunch talks last night, but failed to mend their disagreements over key areas such as economic policy. | Davutoğlo and Erdoğan held crunch talks last night, but failed to mend their disagreements over key areas such as economic policy. |
| Local reports suggest that elections for a new party leader to replace Davutoğlo could soon be called, causing fresh instability at a time when Turkey is already grappling with high inflation and the refugee crisis. | Local reports suggest that elections for a new party leader to replace Davutoğlo could soon be called, causing fresh instability at a time when Turkey is already grappling with high inflation and the refugee crisis. |
| Related: Ahmet Davutoğlu's future as Turkish prime minister in balance | Related: Ahmet Davutoğlu's future as Turkish prime minister in balance |
| 7.53am BST | 7.53am BST |
| 07:53 | 07:53 |
| Asian markets fall for 7th day running | Asian markets fall for 7th day running |
| Anxiety over a possible global downturn has hit stock markets in Asia again. | Anxiety over a possible global downturn has hit stock markets in Asia again. |
| The Hong Kong, South Korea and Philippines markets all shed around 0.5%. This send stocks across the region down for the seventh day running, its longest losing streak of the year | The Hong Kong, South Korea and Philippines markets all shed around 0.5%. This send stocks across the region down for the seventh day running, its longest losing streak of the year |
| Sharon Zollner of ANZ Bank New Zealand Ltd explains that signs of economic slowdown is hurting confidence again: | Sharon Zollner of ANZ Bank New Zealand Ltd explains that signs of economic slowdown is hurting confidence again: |
| Markets seem to be at something of a crossroads at present, waiting for clearer signals on whether U.S. activity will bounce back in the second quarter,”. | Markets seem to be at something of a crossroads at present, waiting for clearer signals on whether U.S. activity will bounce back in the second quarter,”. |
| “If the global economy were to tip into recession at some point, what ammo, precisely, do central banks have left that won’t do more harm than good?” | “If the global economy were to tip into recession at some point, what ammo, precisely, do central banks have left that won’t do more harm than good?” |
| Updated | Updated |
| at 7.55am BST | at 7.55am BST |
| 7.40am BST | 7.40am BST |
| 07:40 | 07:40 |
| The agenda: UK service sector data coming up.... | The agenda: UK service sector data coming up.... |
| Good morning, and welcome to our rolling coverage of the world economy, the financial markets, the eurozone and business. | Good morning, and welcome to our rolling coverage of the world economy, the financial markets, the eurozone and business. |
| So far this week, the UK economic data has been quite disappointing. Construction firms are growing at the slowest rate in three years, and activity across Britain’s manufacturers is actually shrinking again. | So far this week, the UK economic data has been quite disappointing. Construction firms are growing at the slowest rate in three years, and activity across Britain’s manufacturers is actually shrinking again. |
| And investors are worried that the service sector, which makes up around 80% of the economy, may also be weakening. | And investors are worried that the service sector, which makes up around 80% of the economy, may also be weakening. |
| At 9.30am, the latest Service Sector PMI hits the wires, and it may show that growth slowed in April. | At 9.30am, the latest Service Sector PMI hits the wires, and it may show that growth slowed in April. |
| A bad reading will surely reinforce concerns that the UK economy is running out of steam, with the Brexit referendum of 23 June casting a darker shadow over the country. | A bad reading will surely reinforce concerns that the UK economy is running out of steam, with the Brexit referendum of 23 June casting a darker shadow over the country. |
| CMC Markets’ Michael Hewson has the details: | CMC Markets’ Michael Hewson has the details: |
| Both manufacturing and construction PMI’s came in short of expectations with manufacturing slipping into contraction territory for the first time since early 2013. | Both manufacturing and construction PMI’s came in short of expectations with manufacturing slipping into contraction territory for the first time since early 2013. |
| Given how important the services sector is to the UK economy we really need to see a decent number here or run the risk that we see a growth downgrade next week from the latest Bank of England inflation report. Expectations are for a slight decline to 53.6 from 53.7. | Given how important the services sector is to the UK economy we really need to see a decent number here or run the risk that we see a growth downgrade next week from the latest Bank of England inflation report. Expectations are for a slight decline to 53.6 from 53.7. |
| After two days of heavy falls, European stock markets are expected to inch higher this morning. But there’s still plenty of angst about global growth prospects, and recent fluctuations in the foreign exchange markets. | After two days of heavy falls, European stock markets are expected to inch higher this morning. But there’s still plenty of angst about global growth prospects, and recent fluctuations in the foreign exchange markets. |
| Our European opening calls:$FTSE 6134 up 22$DAX 9863 up 34$CAC 4330 up 5$IBEX 8694 up 40$MIB 18038 up 102 | Our European opening calls:$FTSE 6134 up 22$DAX 9863 up 34$CAC 4330 up 5$IBEX 8694 up 40$MIB 18038 up 102 |
| And on the corporate front, we’re getting results from telecoms firms BT, supermarket chain Morrisons, and newspaper group Trinity Mirror. | And on the corporate front, we’re getting results from telecoms firms BT, supermarket chain Morrisons, and newspaper group Trinity Mirror. |
| Updated | Updated |
| at 7.42am BST | at 7.42am BST |