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Heathrow Airport’s passenger traffic slowed in November as speculation swirls over the possibility of a Saudi-state-backed consortium seizing majority control of the hub.

Some 6.1m passengers travelled through the West London airport last month, up 10 per cent year-on-year, but down on October’s 6.9m figure.

It means Heathrow’s total yearly traffic has hit just over 72m, up nearly a third on the prior 11 months, in which the airport was still struggling with a chequered post-pandemic recovery.

Transatlantic travel remains a driving force in that recovery, with 1.4m North American passengers in November nearly matching traffic between the European Union and up 7.7 per cent year-on-year

https://www.cityam.com/heathrow-passenger-traffic-dips-amid-saudi-takeover-speculation/

London saw the highest rate of business activity in November despite bearing the brunt of inflationary pressures.

According to the Natwest regional PMI, the capital continued to outperform all 11 other UK regions in November with a business activity index of 56.5, rising above the 53.8 recorded in October.

A score of over 50 means activity grew rather than contracted.

“Firms in London are thriving, with business activity in the capital showing robust growth as we head towards the end of the year,” Sebastian Burnside, Natwest chief economist commented.

https://www.cityam.com/emb-00-01-11-12-london-is-thriving-business-activity-rises-but-capital-takes-inflation-battering/

The FTSE 100 is expected to edge higher as trading starts for the week on Monday ahead of a busy week for central bank decisions.

The Federal Reserve announces its final rate decision of the year on Wednesday with the Bank of England and European Central Bank following on Thursday.

Spread betting companies are calling London’s lead index up by around 4 points

Retail banks like this have been helped by a raft of interest rate rises during the past year. Bank of England (BoE) policy has helped lift net interest margins (NIMs) across the industry, a key metric to gauge these companies’ performances

https://www.fool.co.uk/2023/12/10/3-reasons-why-lloyds-share-price-could-soar-through-1-in-2024/

Time for a Santa rally as markets sniff turning point in inflation

https://www.google.com/amp/s/www.thisismoney.co.uk/money/comment/article-12845113/amp/HAMISH-MCRAE-Time-Santa-rally-markets-sniff-turning-point-inflation.html

Week ahead: Bank of England, Fed, ECB in focus, plus last earnings stragglers

The big focus in the coming week is on central banks, with company reporting season winding down.

Expectations have been growing for rate cuts next year, so meetings from the US Federal Reserve, Bank of England and European Central Bank should see all three push back to various degrees, with some important macroeconomic updates also due.

50p for Christmas 📈🙌

The FTSE 100 has jumped to its best levels for the day as the pound fell back after the strong US jobs report - boosting the dollar erarners in the index.

In the US, markets opened modestly lower after a strong jobs report although economists remain of the view that interest rates will be cut in the first half of 2024.

Shortly after the opening bell, the Dow Jones Industrial Average was down 8.48 points at 36,108.90, the S&P 500 was down 5.06 points, 0.1% at 4,580.53 and the Nasdaq fell 50.30 points, 0.4%, at 14,289.70.

Paul Ashworth, chief North America economist at Capital Economics explained the 199,000 increase in November’s payroll included 47,000 workers returning from strikes - 30,000 UAW members and 17,000 SAG Aftra members.

Stripping out that one-off boost, the 152,000 gain was roughly the same as the muted increase in October with 49,000 of that total government jobs and a further 77,000 in health care.

He said excluding those non-cyclical sectors, the economy added only 26,000 jobs, which adds to the evidence that, after a very strong third quarter, growth is slowing to a crawl in the fourth quarter.

Trend employment growth, particularly in cyclical sectors, continues to weaken, but there are few signs of any labour market capitulation, he said.

“We expect the economy to narrowly avoid a recession. But, with core inflation rapidly normalising, the Fed will pivot to rate cuts next spring,” he added.

Friday afternoon week hand investors selling off

🙌🙌🙌 diamond hands 🙌🙌🙌

A weak economic outlook and greater caution among employers dampened recruitment during November, according to the latest KPMG and Recruitment & Employment Confederation, UK Report on Jobs survey, compiled by S&P Global.

The report showed a sharper fall in permanent staff appointments combined with a fresh decline in temp billings, to signal a broad-based reduction in hiring activity, while vacancies fell slightly for the second time in the past three months.

Meanwhile, the numbers of job seekers rose at the quickest pace since December 2020, with recruiters widely linking this to redundancies and workers concerned over current job security.

Dec 8 (Reuters) - The rise of inexpensive Chinese electric vehicles has upped the pressure on legacy automakers who have turned to suppliers, from battery materials makers to chipmakers, to squeeze out costs and develop affordable EVs quicker than previously planned.

"Automakers are really now only turning to affordable vehicles, knowing they've got to or they will lose out to Chinese manufacturers," said Andy Palmer, chairman of UK startup Brill Power, which has developed hardware and software to boost EV battery management system performance.

https://www.reuters.com/business/autos-transportation/fear-cheap-chinese-evs-spurs-automaker-dash-affordable-cars-2023-12-08/

The FTSE 100 is expected to make a bright start on Friday ahead of a key print on the US jobs market.

Spread betting companies are calling London’s blue-chip index up by around 18 points

Lloyds Banking Group PLC (LSE:LLOY) slipped 1.0% after broker Jefferies cut earnings estimates and slashed its price target for the UK’s largest mortgage lender.

The broker has made material cuts to net interest income forecasst on expectations for lower net interest margin (NIM), higher deposit churn and lower base rate benefits with the favourable tailwind from structural hedge income not set to be a full offset until the third quarter of 2024.

It expects NIM to trough in the first quarter of 2024 at 301 basis points.

But while the bank has cut 2023-25 earnings by an average of 10%, it maintains forecasts for £7.5 billion of cumulative buybacks over this period.

It is the scale of the share buy-backs – around 26% of the bank’s market value – and 14-15% return on total equity sustains value creation, in Jefferies view.

But given recent industry trends and the company’s own experience, notably in the third quarter, the broker has cut its NIM forecasts by 4bps for 2023 and 26bps for 2024, followed by 12bps in 2025.

Jefferies keeps a ‘buy’ rating on Lloyds but has slashed its price target to 62p from 80p.

"prices were down 1% compared to the prior three-month period"

Halifax data out this morning

Quarterly change -0.7%

Annually change -1.0%

LONDON, Dec 7 (Reuters) - British house prices rose 0.5% in November, their second monthly rise in a row, after a 1.2% increase in October, mortgage lender Halifax said on Thursday.

House prices were 1.0% lower than a year earlier, a slower decline than October's annual decline of 3.1%, Halifax said.

"The resilience seen in house prices during 2023 continues to be underpinned by a shortage of properties available, rather than any significant strengthening of buyer demand. That said, recent figures for mortgage approvals suggest a slight uptick in activity levels," Halifax director Kim Kinnaird said.

Downward pressure on house prices from a squeeze on household living standards was likely to persist in 2024, she added.

Rival mortgage lender Nationwide reported last week that house prices on its measure rose for a third month in a row in November, and were 2% lower than a year earlier.

Https://www.thisismoney.co.uk/money/markets/article-12828931/UK-economy-showing-signs-life-eurozone-heads-recession.html

The Bank of England warned today that mortgage repayments will rise, but said banks are well capitalised, on the release of its latest financial policy record.

“Household finances remain stretched by increased living costs and higher interest rates, some of which has yet to be reflected in higher mortgage repayments,” the BOE said in a statement today to mark its latest financial summary.

“Arrears for secured and unsecured credit remain low but are rising as the impact of higher repayments is felt by borrowers.”

The bank said that more than half of mortgage holders, comprising 55% of mortgage accounts, have repriced their mortgages since interest rates began to rise in 2021.

Those higher rates of interest are expected to affect the mortgage payments of five million householders.

Monthly mortgage repayments for the typical homeowner for fixed-rate mortgages set between the second quarter of 2023 and the end of 2026 will increase by 39%, or an average of £240 per month, the bank said while outlining household debt vulnerabilities.

The BOE warned that “the average debt-servicing burden will increase” as higher mortgage rates continue to flow through to UK households.

However, it said the UK banking system is “well capitalised” with high levels of liquidity and the capacity to support households and businesses even if financial conditions deteriorate.

Bitcoin hitting 18-month highs of more than $43,000

Brussels is set to push back planned post-Brexit tariffs on electric cars by three years in a boost for vehicle manufacturers on both sides of the Channel.

https://www.telegraph.co.uk/business/2023/12/05/eu-delay-uk-electric-car-tariffs-three-years-sales-slump/

Paragon Banking Group PLC (LSE:PAG) jumped over 10% to 540p after it hiked the dividend by almost a third, announced a new share buyback and lifted its outlook on returns and margins

Underlying earnings per share rose 35% to 94.2p, also ahead of estimates, while return on tangible equity of 20% beat the 15% target for the second year running, and prompted an update to guidance from the 15% target to a 15-20% range.

The net interest margin (NIM) widened 40 basis points (bps) in the year to 309bps and is guided to be 300-310bps next year.

Given a strong capital position, with a CET1 ratio of 15.5%, a total dividend of 37.4p was declared, up 31%, and a new share buyback of £50 million was announced.