FTSE dips on China import data but then turns around
Fiona Cincotta June 8, 2020 8:02 PM
Although China’s economy is to a large extent showing a recovery after the pandemic, import numbers are remaining stubbornly low.
Although China’s economy is to a large extent showing a recovery after the pandemic, import numbers are remaining stubbornly low. With a large percentage of China’s imports being used in products that are eventually exported, exports are likely to slow down too over the months ahead. This is not good news for companies with a significant China focus which are already hurting from a decline in domestic sales.
London opened a touch lower on the news and was further weighed down by a decline in AstraZeneca and Smith & Nephew, but then reopening optimism took over and the index started turning around.
Travel industry shares were the best performers, with cruise operator Carnival leading the pack.
On the surface of things airlines should still be struggling as the controversial two-week quarantine rule kicks off today and is expected to stop hundreds of thousands of travelers going abroad for a summer holiday. But investors seem to take the same view as Ryanair boss Michael O’Leary who called the rule a political stunt that will be unenforceable.
AstraZeneca merger likely to hit hurdles on both sides of the pond
With the pharma industry now embroiled in a frantic search for a coronavirus solution it was only a matter of time before a major merger and acquisitions situation occurred. Over the weekend AstraZeneca made that approach, proposing to merger with US drug maker Gilead Sciences in a deal worth potentially $240bn. However, the deal is likely to run into opposition on both sides of the pond, with the US unlikely to be willing to give up domestic control over a developer that can find a solution not only for COVID but also for other potential future outbreaks, the same being the case on the British side of the deal.
From time to time, GAIN Capital Australia Pty Ltd (“we”, “our”) website may contain links to other sites and/or resources provided by third parties. These links and/or resources are provided for your information only and we have no control over the contents of those materials, and in no way endorse their content. Any analysis, opinion, commentary or research-based material on our website is for information and educational purposes only and is not, in any circumstances, intended to be an offer, recommendation or solicitation to buy or sell. You should always seek independent advice as to your suitability to speculate in any related markets and your ability to assume the associated risks, if you are at all unsure. No representation or warranty is made, express or implied, that the materials on our website are complete or accurate. We are not under any obligation to update any such material.
As such, we (and/or our associated companies) will not be responsible or liable for any loss or damage incurred by you or any third party arising out of, or in connection with, any use of the information on our website (other than with regards to any duty or liability that we are unable to limit or exclude by law or under the applicable regulatory system) and any such liability is hereby expressly disclaimed.