European markets mixed, China closed

The FTSE opened the week’s trading on a higher note and moved above the 7,000 mark but European gauges declined amid losses among the financials and industrial companies. Asian markets were mixed with China closed for the rest of the week for Lunar New Year and South Korea on holiday Monday.

The FTSE opened the week’s trading on a higher note and moved above the 7,000 mark but European gauges declined amid losses among the financials and industrial companies. Asian markets were mixed with China closed for the rest of the week for Lunar New Year and South Korea on holiday Monday.

Nissan pulls the plug on Sunderland production

Brexit’s eroding effect on British businesses became once more very blatant after Nissan decided against producing its X-trail sports utility vehicle in Sunderland and instead decided to base production in Japan. According to the company, the 7,000 jobs at the plant are safe for now but Nissan will not hire any new workers there.

A wider survey of British business by Deloitte published Monday sums it up: British business have become less inclined to take on financial risks because of concerns over hard Brexit and rising US protectionism, with the risk appetite falling to its lowest in almost 10 years.

Nissan’s decision is already spilling into other markets and is causing the pound to lose ground against the dollar, trading at $1.3052. In the meantime the PM has set up an “Alternative Arrangements Working Group” to try and renegotiate a Brexit deal with Brussels but this is increasingly too little too late as the country seems to be heading towards a  hard Brexit fast.

Airline stocks under pressure

Overcapacity among budget airlines is to blame for a decline in fares and in profits, according to Irish airline Ryanair, which reported a quarter loss this morning. In contrast to its last quarterly results season when Ryanair turned in solid profits despite a prolonged dispute with German and other continental airline crews, the company now expects to make a lower full year profit as winter fares are declining.  

Brexit remains high on the company’s list of concerns and as a precaution it has placed a restriction on shareholders in the case of hard Brexit which will ensure that it remains an EU-owned airline. Ryanair shares dropped 4.6% in early trade and EasyJet and British Airways owner International Consolidated Airlines followed with smaller losses.

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