FTSE 100 at record high after trade war truce, but pound hits 2018 low – business live

US Treasury secretary Mnuchin says the trade war is ‘on hold’, bringing cheer to nervous markets

The pound has hit its lowest level since the start of the year.

While traders aren’t worrying about trade wars, they are getting jittery about Brexit again.

This backstop has been one of the sticking points in talks with the EU27 and some in Westminster believe it could become the post-Brexit norm if Brussels accepts the UK’s proposal.

But Johnson insisted: “Brexiters fearing betrayal over the customs backstop must understand that the PM has been very clear that it is not an outcome we desire; we want a deal with the EU and she will deliver it.”

Related: Boris Johnson: we want a deal with the EU, not a customs backstop

Metal prices are also getting a small lift this morning.

Reuters has the details:

Copper edged higher on Monday after China and the United States put their trade row “on hold”, easing concerns that the dispute could escalate, although headwinds from a stronger dollar capped further gains.

“It appears that America and China have moved towards a trade deal, which will mean the expansion of U.S. goods purchased by China, and thus, avoiding the prospect of an out-and-out trade war,” said Kingdom Futures in a report.

The FTSE is continuing to climb to fresh record levels, putting 8,000 points in its sights (I don’t think we’ll get there today, though!).

Connor Campbell of City firm SpreadEx says:

After intermittently fretting over signs that hostile relations were heating back up between the US and China last week, Treasury Secretary Steven Mnuchin’s claim on Sunday that a trade war was ‘on hold’ has sent a – cautious – wave of relief through the market.

The US dollar has hit its highest level in five months, against a basket of other currencies.

That’s another sign that traders are comforted that the US and China have frozen tariffs on a swathe of exports – something that could have hurt the American economy.

Hussein Sayed, chief market strategist at FXTM, reminds us that America and China haven’t actually hammered out a full agreement on trade yet.

Sayed points out that details of the truce remain vague.

This was the second round of trade negotiations without clearly defined targets, suggesting that there’s still a long way to go.

Today, a trade war may have been averted, but according to the joint statement from both countries, nothing is being guaranteed apart from China promising to increase American imports

Boom! The UK’s FTSE 100 index has burst to a new-alltime high this morning.

The Footsie gained 35 points, or 0.45%, to 7814 points for the first time ever.

Although there’s relief that the US and China have stepped back from a trade war, analysts are also cautious.

Tai Hui, chief market strategist for Asia Pacific at JP Morgan, predicts further clashes between the two sides:

Historical precedents suggest the U.S. could re-engage with China on trade issues if it sees China dragging its feet on fulfilling its pledges. Moreover, the last three months have further exposed Washington’s concerns over China’s advancement in technology and its threat as a competitor, both commercially and strategically.

It’s like a back pain that never goes away. It was a shock in the first instance it happened, but then life goes on as the most acute symptoms are addressed. The good news is that markets should learn to live with it and consider its impact more rationally.”

“The fundamental differences on trade and other economic issues remain unresolved.”

The undeclared “trade war” between US and China has been put on hold according to US Treasury Secretary Mnuchin as the two superpowers agree on a economic truce.

This development puts the planned tariffs on hold while the two countries work on a plan to re-balance their trade relations and dampens the geopolitical risk.

Britain’s blue-chip share index of top shares is likely to smash through 7,800 points for the first time ever today.

City traders are predicting a rally in London, thanks to the new spirit of detente between the US and China over trade.

US and China stepping back from the brink of a trade war has lifted sentiment, boosting equity indices, putting the FTSE on track for a fresh record high.

Asian equities have bounced and Europe points to a higher start, as Trump’s administration halts plans to impose trade tariffs on China, whilst China promises to significantly increase its purchase of US farm exports and energy.

Good morning, and welcome to our rolling coverage of the world economy, the financial markets, the eurozone and business.

It’s going to be a positive start to the marketss after U.S. Treasury Secretary Steven Mnuchin declared the U.S. trade war with China “on hold” following an agreement to drop their tariff threats that had roiled global markets this year: https://t.co/kwwvvVNoZp pic.twitter.com/kLyqeHdaLZ

“We’re putting the trade war on hold, right now, we have agreed to put the tariffs on hold while we try to execute the framework.”

Related: US and China put trade war ‘on hold’

Morning all!

– Asian equity markets traded mostly positive with sentiment underpinned following the conclusion of the 2nd round of US-China trade talks

– China agreed to purchase more goods to avoid a trade war. Mnuchin announced that tariffs on China would be placed on hold as discussions progress

Concerns about an escalation in tensions between China and the US appear to have been deferred in the short term after progress in trade talks at the weekend.

Continue reading…

US and China put trade war ‘on hold’

Steven Mnuchin, US Treasury secretary, says negotiations over tariffs with China have borne fruit

America has pulled back from launching a trade war with China that could have destabilised the global economy, by agreeing to put proposed tariffs on Chinese imports “on hold”.

Treasury secretary Steven Mnuchin said on Sunday that negotiations with Chinese officials have borne fruit, meaning Washington and Beijing can step back from imposing punishing tariffs on each other’s exports.

Related: Xi strikes conciliatory tone on trade but offers few concessions

Related: China and US reach ‘consensus’ on reducing trade gap

Continue reading…

Shared housing startups are taking off

When young adults leave the parental nest, they often follow a predictable pattern. First, move in with roommates. Then graduate to a single or couple’s pad. After that comes the big purchase of a single-family home. A lawnmower might be next.

Looking at the new home construction industry, one would have good reason to presume those norms were holding steady. About two-thirds of new homes being built in the U.S. this year are single-family dwellings, complete with tidy yards and plentiful parking.

In startup-land, however, the presumptions about where housing demand is going looks a bit different. Home sharing is on the rise, along with more temporary lease options, high-touch service and smaller spaces in sought-after urban locations.

Seeking roommates and venture capital

Crunchbase News analysis of residential-focused real estate startups uncovered a raft of companies with a shared and temporary housing focus that have raised funding in the past year or so.

This isn’t a U.S.-specific phenomenon. Funded shared and short-term housing startups are cropping up across the globe, from China to Europe to Southeast Asia. For this article, however, we’ll focus on U.S. startups. In the chart below, we feature several that have raised recent rounds.

Notice any commonalities? Yes, the startups listed are all based in either New York or the San Francisco Bay Area, two metropolises associated with scarce, pricey housing. But while these two metro areas offer the bulk of startups’ living spaces, they’re also operating in other cities, including Los Angeles, Seattle and Pittsburgh.

From white picket fences to high-rise partitions

The early developers of the U.S. suburban planned communities of the 1950s and 60s weren’t just selling houses. They were selling a vision of the American Dream, complete with quarter-acre lawns, dishwashers and spacious garages.

By the same token, today’s shared housing startups are selling another vision. It’s not just about renting a room; it’s also about being part of a community, making friends and exploring a new city.

One of the slogans for HubHaus is “rent one of our rooms and find your tribe.” Founded less than three years ago, the company now manages about 80 houses in Los Angeles and the San Francisco Bay Area, matching up roommates and planning group events.

Starcity pitches itself as an antidote to loneliness. “Social isolation is a growing epidemic—we solve this problem by bringing people together to create meaningful connections,” the company homepage states.

The San Francisco company also positions its model as a partial solution to housing shortages as it promotes high-density living. It claims to increase living capacity by three times the normal apartment building.

Costs and benefits

Shared housing startups are generally operating in the most expensive U.S. housing markets, so it’s difficult to categorize their offerings as cheap. That said, the cost is typically lower than a private apartment.

Mostly, the aim seems to be providing something affordable for working professionals willing to accept a smaller private living space in exchange for a choice location, easy move-in and a ready-made social network.

At Starcity, residents pay $2,000 to $2,300 a month, all expenses included, depending on length of stay. At HomeShare, which converts two-bedroom luxury flats to three-bedrooms with partitions, monthly rents start at about $1,000 and go up for larger spaces.

Shared and temporary housing startups also purport to offer some savings through flexible-term leases, typically with minimum stays of one to three months. Plus, they’re typically furnished, with no need to set up Wi-Fi or pay power bills.

Looking ahead

While it’s too soon to pick winners in the latest crop of shared and temporary housing startups, it’s not far-fetched to envision the broad market as one that could eventually attract much larger investment and valuations. After all, Airbnb has ascended to a $30 billion private market value for its marketplace of vacation and short-term rentals. And housing shortages in major cities indicate there’s plenty of demand for non-Airbnb options.

While we’re focusing here on residential-focused startups, it’s also worth noting that the trend toward temporary, flexible, high-service models has already gained a lot of traction for commercial spaces. Highly funded startups in this niche include Industrious, a provider of flexible-term, high-end office spaces, Knotel, a provider of customized workplaces, and Breather, which provides meeting and work rooms on demand. Collectively, those three companies have raised about $300 million to date.

At first glance, it may seem shared housing startups are scaling up at an off time. The millennial generation (born roughly 1980 to 1994) can no longer be stereotyped as a massive band of young folks new to “adulting.” The average member of the generation is 28, and older millennials are mid-to-late thirties. Many even own lawnmowers.

No worries. Gen Z, the group born after 1995, is another huge generation. So even if millennials age out of shared housing, demographic forecasts indicate there will plenty of twenty-somethings to rent those partitioned-off rooms.

An 800-year-old label may rewrite the history of a Java Sea shipwreck

In the 1980s, fishermen working off the coast of Indonesia made a surprising haul: a cargo of ceramic vessels, elephant tusks, sweet-smelling resin, and other artifacts from a ship that had lain on the bottom of the Java Sea for centuries. Most of the ship’s hull was long since gone; wood decays quickly in warm waters, leaving behind only its former contents.

Now, a closer look at its cargo reveals that the ship may have gone to the bottom a century earlier than archaeologists first suspected, which puts it in the middle of a very interesting period in Chinese history.

May you live in interesting times

The Song dynasty (1127-1279) was the height of ceramic export production in China, when the imperial court encouraged overseas trade. Ships crossing the seas were beginning to form a more direct link between far-flung trading partners than the ancient Silk Road could allow. The Srivijaya empire, a formidable maritime power based on Sumatra, was in decline, and other coastal powers in the region were vying for its former supremacy.

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China’s Didi pares back ‘hitchhiking’ car service following passenger murder

Didi Chxuing is making big changes to Hitch, its inter-city carpooling service, following the murder of a passenger at the hands of a driver earlier this month.

Last week, Didi — China’s dominant ride-hailing service by some margin — expressed its “deep remorse” for the murder, and suspended Hitch for a week to conduct a review of the service.

Hitch, as the name suggests, is a hitchhiking-style service that groups people who are headed in the same direction together. Unlike Didi’s other services, it isn’t commercial; passengers give the driver their share of fuel and any other costs they want to cover. That makes it affordable and hugely popular, but it has also made the service less professional than Didi’s other modes of transport. Indeed, many in China have claimed the service is ‘sleazy,’ with many comments left about passenger appearances, particularly those who are female.

The primary change will see Hitch available limited to daytime when the service resumes, with no new rides able to start between the hours of 10pm and 6am.

In an apparent nod to the unsavory elements, Didi is scrubbing all Hitch driver and passenger reviews and ratings. Personal information for users will no longer be public, and profile photos will be replaced by generic images, Didi said.

Beyond Hitch, Didi is also making changes to its driver authentication program.

That’s down, in a large part, to the fact that the suspect in the murder of the passenger was not a verified Didi driver. He was able to use the app (on more than one occasion) by taking the smartphone belonging to his father, who is a verified Didi driver. Didi’s facial recognition technology, which verifies a driver’s identity before granting them access to the service, failed in this instance — Didi said it was “defective” that day.

Didi is closing down the option for its drivers to use other people’s cars with their permission, and implementing a “zero tolerance policy” on matching cars with their registered owners — a strange loophole that drew concern.

The Didi service added an SOS button two years ago, and now it is aiming to refine that further by introducing automatic audio recording which is passed in real-time to a customer support agent once an SOS is activated. The firm said it is also weighing up adding video in the future. Conscious of privacy concerns, the company said the audio would be stored remotely, not on a passenger’s device, and deleted within 72 hours if not needed for longer.

“We understand that not everyone is comfortable with having their trips recorded. Additional user authorization may also be needed if in-vehicle video monitoring were to be introduced in the future,” the company said.

“Nevertheless, this could be a most effective means to enhance safety standards, and to ensure adequate evidence support for potential dispute resolution,” Didi added. “Would this be an acceptable solution in the eyes of our users?”

That’s one of a series of questions put out by Didi, which said it will solicit opinions for potential safety measures. The company said it has booked “proactive consultation sessions with relevant authorities and experts” and it will also put out a call for comment on its social media channels.

Didi is facing pressure from rival Meituan Dianping, which started out in local services but recently introduced ride-sharing services and moved into dockless bikes with the acquisition of Mobike.

This is not the first time that Didi, which became China’s single-largest ride-hailing company when it bought out Uber’s local business in 2016, has dealt with the murder of a customer. Two years ago, a woman in Shenzhen was robbed and murdered by a Didi driver.

Donald Trump’s policies leading to surging oil prices, trade disputes that threaten U.S. economy

United States President Donald Trump’s freewheeling policies are beginning to damage the American economy as exuberance over tax cuts turns to fear on trade and oil prices, it is claimed.

Crude costs are approaching US$80 per barrel, their highest level since 2014, and analysts fear the U.S. withdrawal from the Iran nuclear deal will make the situation worse. “If a new Iran deal is not reached in the next six months or OPEC/Russia extend production cuts into 2019, global oil markets would likely tighten further,” said Francisco Blanch at Bank of America Merrill Lynch.

Oxford Economics has raised its forecast for oil prices to an average of US$72 for 2018, which it fears could have serious repercussions for the economy.

“If WTI crude oil prices average US$70 per barrel this year, the U.S. economy could suffer a drag worth half of the 0.7 percentage point fiscal stimulus boost,” said Gregory Daco. “If sustained, rising oil prices could sap global momentum.

“We find that the most severely affected from an oil price shock would be large emerging markets like China, India, Indonesia. Advanced economies with reduced oil usage intensity would also suffer but to a lesser degree.”

At the same time, trade skirmishes between the U.S. and China risk denting growth too, credit ratings agency Standard and Poor’s has warned.

“As the U.S.-China trade spat drags on, it’s become clear that a prolonged period of iciness between the countries, or an escalation of the dispute, could have notable effects on the world’s two biggest economies,” said U.S. chief economist Beth Ann Bovino.

Planned U.S. tariffs will add as much as 0.2 percentage points to inflation.

“While that level alone isn’t enough to spur the Federal Reserve to raise rates any faster, it does add to inflationary pressures that have been building in the supply chain,” she said.

“Add to this the potential job losses in certain industries — with more than 2 million American workers exposed to Chinese retaliatory tariffs on the export side, according to one estimate — and it’s clear that an escalation in tensions between the two countries would have noteworthy, real-world ramifications.”

The Daily Telegraph

Trump vows to reopen smartphone giant ZTE to save Chinese jobs

Last week, smartphone giant ZTE shut down its “major operating activities” after the Trump administration imposed a crippling seven-year export ban on the company. But on Sunday, Donald Trump signaled that ZTE might get a reprieve:

It’s a remarkable change of tone for a president who long railed against China for stealing American jobs.

ZTE is China’s number-two smartphone maker, and as recently as last year it was the number-four smartphone vendor in the US. But the company is facing a de facto corporate death sentence after US officials caught the company covertly sending telecommunications equipment with significant American-made components to Iran and North Korea in violation of US export restrictions.

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President Trump says he’s working to give ZTE a reprieve

In a remarkable development, President Trump has thrown an olive branch to controversial Chinese telecom firm ZTE less than a week after it ceased its main business following restrictions from the U.S. government.

ZTE, which develops telcom network equipment and sells consumer devices including smartphones, said on Wednesday that it would cease its main business operations after the U.S. Department of Commerce announced a seven-year export restriction for the company, resulting in a ban on U.S. component makers selling to ZTE.

The company has been banned from selling equipment in the U.S., but shutting out supply chain partners like Intel, Qualcomm and Google is potentially catastrophic. (The fact ZTE postponed its earnings tells you all you need to know.)

Reports suggested that the Chinese government was working on ZTE’s half to find a compromise, and it looks like Chinese Premier Xi Jinping himself got in touch with the U.S. President, who said today in a tweet that is he “working… to give… ZTE a way back into business, fast.”

Somewhat bizarrely, Trump cited a loss of jobs in China as a motivating factor.

Given that U.S. sanctions were imposed on ZTE due to threats to national security and its violation of trade trade sanctions with Iran, Trump’s desire to give the company another chance in the U.S. is truly unexpected.

It also doesn’t align with recent events.

The Trump administration has used the premise of national security to block a number of business deals that would see Chinese companies buying up American firms — including Alibaba’s proposed acquisition of MoneyGram and Broadcom’s effort to buy Qualcomm.

Then, of course, the President is involved in an aggressive trade dispute with China, which, on the U.S. side, included tariffs on about $60 billion of Chinese goods, the bulk of which were focused on the high-tech industry.

Granting a reprieve to ZTE — a firm with over 70,000 employees, over $17 billion in annual revenue and close ties to the government — doesn’t fit with the strategy to hurt China, but then Trump’s administration is hardly by the book and often times seemingly pragmatic. Well, the President’s Twitter account, at least.

Potentially, there may be pressure behind the scenes from U.S. suppliers who fear a loss of business as companies like Taiwan’s MediaTek plan to step up in a bid to work with ZTE in the event that it is blocked from U.S. partners.

Even with Trump’s unexpected backing, ZTE is up against it to roll back the sanctions. There’s clearly a gap of thinking between the President and the rest of government.

Trump has frequently lashed out at the House and the Senate, not to mention his own party, over differences of opinion and his frustration with politics. In this case, ZTE’s infringements are so major — trade violations and national security concerns — that it is hard to envisage the company getting a pass, even with support from the White House.

Just another day in Trump’s America, it seems.