Asian stock market losses mount amid fears over trade, oil and rates – business live

It’s a very jittery start to the week amid the Khashoggi standoff, US-China trade tensions and concern about US borrowing costs. Follow all the action live

Saudi stocks tumble on fallout from Khashoggi disappearance
UK: forecasts say economy could see worst year since crash
Theresa May vulnerable as Brexit talks on knife-edge

The losses continue to mount up on financial markets amid uncertainty across the world about trade, rising US interest rates and now a potential clash between the US and Saudi Arabia over the fate of missing journalist Jamal Khashoggi.

The Saudi tension has sent the price of oil up and it’s also been a rough night for the pound ahead of this week’s crunch Brexit summit with sterling slipping. The yen meanwhile has strengthened a touch against the dollar.

It will be fascinating to see where the price of oil goes this week. Brent futures have risen 1.255 today to $81.5 a barrel and that could rise to $100 according to one analyst.

Kazuhiko Fuji, senior fellow at the Japanese government thinktank, the Research Institute of Economy, Trade and Industry, said:

Oil prices could rise to $100 on worries about Saudi Arabia. People had thought the Saudis will make up for fall in Iran’s output. If they are starting to use oil as their weapon, that will be a whole new chapter.

Apologies – I jumpped the gun on the Aussie market. The final settlemtn pushed it deeper into the red to end down 58.6 points, or 0.99%, at 5837.1 points.

Sears, the venerable US retailer, has gone into administration. It has filed for chapter 11 bankruptcy, according to a filing in a New York court, Reuters reports.

The ASX200 is done for the day. It finishes down 46 points, or 0.79%, at 5,849 points.

Saudi Arabia has threatened to retaliate against the world economy if western nations impose sanctions or similar if it emerges that the country’s security forces murdered the journalist Jamal Khashoggi.

Related: How much damage can Saudi Arabia do to the global economy?

We seem to have hit a fairly quiet spot in the trading day.

The ASX200 in Sydney is down around 1% and is due to close in a few minutes.

Talking of China, it’s worth revisiting comments by the country’s central bank governor at the close of the IMF meeting in Bali on Sunday.

Yi Gang said China still had plenty of room for adjustment in interest rates and the reserve requirement ratio (RRR) in the face of any negative impact from trade tensions with the United States.

Chris Weston of Pepperstone in Melbourne has weighed with some commentary, saying things could quite ugly on stock markets if data out of China – inflation, GDP and retail sales – disappoints later in the week.

After last week’s volatility shock to markets, we start the week on a negative tone, with broad weakenss through Asia and the ASX 200 falling out of bed. The weekend news flow has centred on a lack of progress in the Brexit negotiations, a deterioration in Saudi/US relations, which have resulted in a 1.1% rally in crude, and the loss of majority for the CSU party in the German regional elections.

Here are the latest scores, courtesy of IC Markets (although I think they’ve missed the minus sign off the Hang Seng price):

Asia UPDATE: #Nikkei 225 -1.50% #Hangseng 1.03%#KOSPI -0.47%#ASX200 -1.16%#SSEC -0.01%#STI -0.27%#Equities

The pound is set for a volatile few days as the wrangling over Brexit intensifies ahead of the meeting of European leaders starting on Wednesday night. It sits at $1.31 at the moment after losing 0.3% today.

The key issue is how to prevent a hard border between Northern Ireland and the Republic. The EU wants the North to remain essentially bound by EU customs rules but that is facing pushback from Brexiters. Theresa May is hoping a temporary “backstop” can be put in place where the whole country remains in the customs deal for the time being.

In presuming to change the constitutional arrangements of the United Kingdom, the EU is treating us with naked contempt. Like some chess player triumphantly forking our king and our queen, the EU commission is offering the UK government what appears to be a binary choice. It is a choice between the break-up of this country, or the subjugation of this country, between separation or submission.

Still with Australia and interesting to note that Shane Oliver, the high-profile chief economist at AMP, has suggested that he might have to revise downwards his forecasts on house prices.

He tweeted on Saturday that the auction results weren’t good but his forecast of a peak to trough fall of 15% out to 2020 remained in place. But he told the AFR that he might hve to rethink that forecast on the downside.

…Domain auction clearances. Auction sales volumes running down 50% from year ago in both Sydney and Melbourne. All consistent with further falls in home prices …our forecast remains for top to bottom falls of 15% out to 2020. Risk on downside. #ausecon pic.twitter.com/SY45iIYpzc

In Australia the ASX200 has had a torrid morning. At one point it was down more than 1.5% but it has recovered at bit and is now at 5,829, a fall of 66 points or 1.1%.

The financial sector has been battered amid concern about the impact of the royal commission on the big four and the amount of compensation they will have to pay. Commonwealth is the worst performing, down more than 2%.

Banks’ share prices have no floor. You have deteriorating housing market which will affect their balance sheets, rising interest rates will do the same. Banks’ share price essentially depends on how bad the bust will be in Oz housing, especially NSW, VIC and WA #ausbiz https://t.co/QFQiohosMy

The Chinese trading day has kicked off.

The Hang Seng is down nearly 1% while the Shanghai Composite is up a fraction.

Another major factor in stock market losses this week has been the prospect of a full-blown US-China trade war. But calls for calm from leaders gathered at the IMF conference in Bali last week seem to have fallen on deaf ears.

The Chinese currency fell again against the dollar today. It’s now at 6.92. That is sure to rattle Washington where there is a widespread view that beijing manipulates the currency to benefit exporters.

China is unlikely to let the yuan weaken past 7 per dollar any time soon, according to market observers https://t.co/1ENWIwgWuB pic.twitter.com/XIJjyL4jFu

While the Ssudi government has come out fighting on the prospect of US sanctions in the Khashoggi case, the boss of the Saudi-owned Al-Arabiya satellite news network has gone a few steps further.

Turki Aldakhil paints an apocalyptic picture of world affairs if the US tries to get tough on the Saudis. He says the kingdom would respond by slashing oil output and would team up with Russia and stop buying US arms. The US would be “stabbing itself to death”.

Imposing any type of sanctions on Saudi Arabia by the West will cause the kingdom to resort to other options, US President Donald Trump had said a few days ago, and that Russia and China are ready to fulfill Riyadh’s military needs among others. No one can deny that repercussions of these sanctions will include a Russian military base in Tabuk, northwest of Saudi Arabia, in the heated four corners of Syria, Israel, Lebanon and Iraq.

At a time where Hamas and Hezbollah have turned from enemies into friends, getting this close to Russia will lead to a closeness to Iran and maybe even a reconciliation with it.

The list of marquee speakers at the Future Investment Intiative conference in Saudi Arabia next week makes interesting reading because a few of them have now said they will not be going.

Jamie Dimon has pulled out along with the boss of Uber and the editor of the Economist, Zanny Minton-Beddoes, while US treasury secretary Steve Mnuchin is under pressure not to go. Watch this space for more.

The rise in oil prices is gathering pace too.

Brent futures are up 1.3% to $81.54 a barrel.

The sellers are gaining the upper hand in stock markets around Asia Pacific today. Hong Kong and China open later this morning. But this is how it’s looking so far:

[CHART] Sellers continue to challenge the ASX 200 on Monday with the index making news session lows as lunch approaches #ausbiz Iress pic.twitter.com/q0XzlSZzgO

Bill Ford, the chief executive of Ford, has become the latest high-profile business leader to pull out of the Future Investment Initiative conference in Riyadh later this month, Reuters reports.

He joins JP Morgan boss Jamie Dimon in announcing his withdrawal on Sunday. Neither cited a reason but it is suspected that the diplomatic standoff over the Khashoggi affair would be high on the list.

Related: Saudi Arabia to hit back in case of sanctions over Jamal Khashoggi

Trading is under way in Japan and Korea. The Nikkei is off 1% and the Kospi is down 0.5% in Seoul.

That seems par for the course today given the poor start in Sydney, where it’s now off 0.89% for the day. The question is whether the markets can bounce back or they are dragged lower by a compound of problems …

The price of Brent crude has risen this morning to $80.5 a barrel.

It’s surely connected to the Saudi issue, so it’s worth looking again at what the kingdom has said about possibly retaliating to external pressure over the Khashoggi affair.

The kingdom affirms its total rejection of any threats and attempts to undermine it, whether through economic sanctions, political pressure or repeating false accusations. The kingdom also affirms that if it is [targeted by] any action, it will respond with greater action.

Brent crude, the global oil benchmark, earlier this month hit a 4-year high above $85 a barrel. Oil Weapon? Saudi Arabia used its petroleum resources as a political weapon when it led an Arab oil embargo during the 1973 war between Israel and a coalition of Arab states. Since

watch the #BRENT crude opening price tomorrow to realize the Saudi deter.
we are not a warmongers but if the enemies starts to blackmail us we are ready to play the game
the #Saudi_Arabia never used an assassination and will never do it.
we are disappointed from our allies!!

The standoff between Saudi Arabia and just about everyone else in the world over the disappearance of journalist Jamal Khashoggi looks like intensifying. The Saudis have promised pushback if Donald Trump carries out his threat of “severe Punishment” if the kingdom is found to have disposed of Khashoggi, as alleged by Turkey.

Now, Reuters report that JP Morgan Chase chief executive Jamie Dimon has cancelled plans to attend a Saudi Arabian investor conference later this month.

In currencies, the US dollar has gained a bit today. That means the Aussie dollar is down slightly at US71.07 while the yen has slipped to 112.2. The pound is at $1.31.

The benchmark ASX200 has slipped around 1% in the first few minutes.

The banks, as usual of late, have been sold with the financial sector down 1.47%. Same for resources which are down more than 1% but utilities are off 2%.

Local shares slide on the open to continue recent downward pressure. #ASX 200 -55pts or 0.95% to 5840 despite a rebound for Wall St on Friday. All sectors bar healthcare are in the red #ausbiz

#ASX200 deeply oversold. We should get back to at least 6102/6140 by early next week before a retest of Friday’s low kicks off.

More commentary on the Australian market from Michael McCarthy at CMC Markets. His thrust is that this week sees a lot of data from China including lending, retail sales and GDP which should give us a picture of where the superpower is heading, ie is it in good enough shape to survive a trade-war inspired downturn? There’s also inflation and trade data from Japan, retail sales in the UK and in the US, retail sales, housing numbers and Fed minutes.

Here’s what Michael says:

Australian investors face a challenge at this morning’s opening. Despite positive moves for US shares and buoyant industrial commodities SPI futures were belted at the New York close, suffering a 51 point loss for the session. The first hour of trading may indicate whether this was an error or the beginning of further underperformance for Australian shares.

Greg McKenna, the independent market strategist, says the markets narrative has been hijacked by the Saudi pushback and Brexit but reckons it’s a close call on what direction things will take.

This is what he says in his morning note:

Much water to flow here especially for the Pound and oil prices. Looking back to Friday though and while stocks in the US rallied into the close it was a messy day and hardly a convincing bounce. Is it the bottom? Many think so and the medium-term charts recovered to hold channel bottoms. But we’ll see.

Good morning and welcome to the Guardian business live blog.

We’re firing up a bit earlier than usual today because it looks like being an interesting session in Asia Pacific markets.

APAC Opening Calls:#ASX 5824 -1.03%#NIKKEI 22523 -0.83%#HSI 25693 -0.29%#NIFTY 10477 +0.09%#CSI300 3161 +0.37%

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NATO Coordinates Information War On Russia

Via The Strategic Culture Foundation,

The US, Britain and other NATO allies upped the ante this week with a coordinated campaign of information war to criminalize Russia. Moscow dismissed the wide-ranging claims as “spy mania”. But the implications amount to a grave assault recklessly escalating international tensions with Russia.

The accusations that the Kremlin is running a global cyberattack operation are tantamount to accusing Russia of “acts of war”. That, in turn, is creating a pretext for NATO powers to carry out “defensive” actions on Moscow, including increased economic and diplomatic sanctions against Russia, as well as “counter” cyberattacks on Russian territory.

This is a highly dangerous dynamic that could ultimately lead to military confrontation between nuclear-armed states.

There are notably suspicious signs that the latest accusations against Russia are a coordinated effort to contrive false charges.

First, there is the concerted nature of the claims. British state intelligence initiated the latest phase of information war by claiming that Russian military intelligence, GRU, was conducting cyberattacks on infrastructure and industries in various countries, costing national economies “millions of pounds” in damages.

Then, within hours of the British claims, the United States and Canada, as well as NATO partners Australia and New Zealand followed up with similar highly publicized accusations against Russia. It is significant that those Anglophone countries, known as the “Five Eyes”, have a long history of intelligence collaboration going back to the Cold War years against the Soviet Union.

The Netherlands, another NATO member, added to the “spy mania” by claiming it had expelled four members of Russian state intelligence earlier this year for allegedly trying to hack into the headquarters of the Organization for the Prohibition of Chemical Weapons (OPCW), based in The Hague.

There then followed predictable condemnations of Russia from the NATO leadership and the European Union. NATO was holding a summit in Brussels this week. It is therefore plausible that the timing of the latest claims of Russian “malign activity” was meant to coordinate with the NATO summit.

More sanctions against Moscow are expected – further intensifying tensions from already existing sanctions. More sinister were NATO warnings that the military alliance would take collective action over what it asserts are Russian cyberattacks.

This is creating a “casus belli” situation whereby the 29 NATO members can invoke a common defense clause for punitive actions against Russia. Given the rampant nature of the claims of “Russian interference” and that certain NATO members are rabidly Russophobic, it is all too easily dangerous for cyber “false flags” to be mounted in order to criminalize Moscow.

Another telltale factor is that the claims made this week by Britain and the other NATO partners are an attempt to integrate all previous claims of Russian “malign activity”.

The alleged cyber hacking by Russia, it is claimed, was intended to disrupt OPCW investigations into the purported poison-assassination plot against Sergei Skripal, the former Russian spy living in Britain; the alleged hacking was also claimed to be aimed at disrupting investigations into alleged chemical weapons atrocities committed by the Syrian government and by extension Syria’s ally Russia; the alleged Russian hacking claims were also linked to charges of Olympic athletes doping, as well as “interference in US elections”; and even, it was asserted, Russia trying to sabotage investigations into the downing of the Malaysian civilian airliner over Ukraine in 2014.

Up to now, it seems, all such wildly speculative anti-Russia narratives have failed to gain traction among world public opinion. Simply due to the lack of evidence to support these Western accusations. The Skripal affair has perhaps turned into the biggest farce. British government claims that the Kremlin ordered an assassination have floundered to the point of ridicule.

It is hardly coincidence that Britain and its NATO allies are compelled to shore up the Skripal narrative and other anti-Russian narratives with the ramped up “global cyberattack” claims made this week.

Photographs of alleged Russian intelligence operatives have been published. Potboiler indictments have been filed – again – by US law enforcement agencies. Verdicts have been cast by NATO governments and compliant news media of Russian state culpability, without Moscow being given a fair chance to respond to the “highly likely” claims. Claims and narratives are being accelerated, integrated and railroaded.

It is well-established from the explosive disclosures by Edward Snowden, among other whistleblowers, that the American CIA and its partners have the cyber tools to create false “digital fingerprints” for the purpose of framing up enemies. Moreover, the vast cyber surveillance operations carried out by the US and its “Five Eyes” partners – much of which is illegal – is an ironic counterpoint to accusations being made against Russia.

It is also possible in the murky world of all foreign states conducting espionage and information-gathering that attribution of wrongdoing by Russia can be easily exaggerated and made to look like a campaign of cyberattacks.

There is a lawless climate today in the US and other Western states where mere allegations are cited as “proof”. The legal principle of being innocent until proven guilty has been jettisoned. The debacle in the US over a Supreme Court judge nominee is testament to the erosion of due process and legal standards.

But what is all the more reprehensible and reckless is the intensification of criminalization of Russia – based on flimsy “evidence” or none at all. When such criminalization is then used to “justify” calls for a US-led naval blockade of Russian commercial oil trade the conditions are moving inevitably towards military confrontation. The blame for belligerence lies squarely with the NATO powers.

A further irony is that the “spy mania” demonizing Russia is being made necessary because of the wholly unsubstantiated previous claims of Moscow’s malfeasance and “aggression”. Illusions and lies are being compounded with yet more bombastic, illusory claims.

NATO’s information war against Russia is becoming a self-fulfilling “psy-op”. In the deplorable absence of normal diplomatic conduct and respect for international law, NATO’s information war is out of control. It is pushing relations with Russia to the abyss.

What’s the point of growth if it creates so much misery? | Lynsey Hanley

Forget the ‘high-skill, hi-tech’ obsession: we should invest in everyday services to create a society run for collective good

The late Prof Mick Moran, who taught politics and government at Manchester University for most of his professional life, had, according to his colleagues, once had “a certain residual respect for our governing elites”. That all changed during the 2008 financial crisis, after which he experienced an epiphany “because it convinced him that the officer class in business and in politics did not know what it was doing”.

After his epiphany, Moran formed a collective of academics dedicated to exposing the complacency of finance-worship and to replacing it with an idea of running modern economies focused on maximising social good. They called themselves the Foundational Economy Collective, based on the idea that it’s in the everyday economy where there is most potential for true social regeneration: not top-down cash-splashing, but renewal and replenishment from the ground upwards.

It hurts nobody to bring local services back into local authority control and to divest from outsourcing firms

Related: How to build a fairer city

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Want To Boost Your Salary? Try Moving To Singapore

Are you a diligent US-based worker who’s tired of watching inflation wipe out what little wage gains you’ve managed to scrape together over the past few years? Well, if you’re looking for a pay boost, but don’t want to go through all the trouble of finding another better-paying job, Bloomberg has a suggestion: Try moving to Singapore.

Switzerland

According to HSBC’s annual Expat Explorer, 45% of expats reported earning more money working abroad than they did working in the US. For the average expat, moving abroad boosted their pay by 21%, with the highest-paying jobs found in the US, Singapore and Hong Kong.

Switzerland

Expats living in Switzerland, notorious for its high cost of living, reported an annual income boost totaling $61,000. Salaries averaged $203,000 per year, twice the global level. 

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Meanwhile, Singapore was ranked best place to live and work for a fourth straight year, ahead of New Zealand, Germany and Canada, while Switzerland (probably because of the high cost of living mentioned above) ranked eighth.

“Singapore packs everything a budding expat could want into one of the world’s smallest territories,” said John Goddard, head of HSBC Expat.

Sweden won first place in the ‘family’ category, while New Zealand, Spain and Taiwan led the ‘experience’ category.

If moving abroad has always been a personal dream, then HSBC can name myriad benefits – both financial and familial – that often accompany expat status. However, the report had its blemishes. For example, the survey of 22,318 people showed that women often trailed behind men in terms of the level of benefit they experienced. For example, relocating only boosted a woman’s income by 27%, compared with 47% for men (apparently, HSBC found, the fabled wealth gap exists outside the confines of the US).

But the bank also found several justifications for this that had nothing to do with women being paid less for doing the same exact job. Just half the women surveyed worked full time, and the average level of education was lower for women than for men.