Yahoo Finance What to Watch: Global stocks drop, Saudi Arabia under pressure, Nissan delays UK pay talks
Here’s a daily overview of some key companies and business developments that the Yahoo Finance UK team is monitoring in Europe and abroad:
Global stocks keep dropping
European shares have failed to rebound on Monday after a deeply negative week. A flurry of threats such as trade wars, rising US bond yields, a slowdown in China and Brexit continue to weigh on markets.
Most of the key European indices are dropping by roughly 0.5% in morning trading, with companies including Airbus (AIR.PA) and Kering (KER.PA) down by about 2% and 3%, respectively. This comes after many major Asian indices locked in losses in excess of 1% on Monday.
The main three US indexes are also down in premarket trading, with the Nasdaq Composite set for a 1% drop at the open.
Over the course of last week, the Dow Jones Industrial Average and the S&P 500 both lost roughly 4%. The Nasdaq Composite lost 3.7%.
Saudi Arabia under pressure
Rising diplomatic tensions between Saudi Arabia and the West over the disappearance of a journalist has had a big impact on the Saudi markets and oil prices.
There are concerns the journalist case could trigger US sanctions against Riyadh and shrink inflows of foreign investment.
US President Donald Trump has threatened to punish Riyadh if it turns out that missing journalist Jamal Khashoggi was killed in the Saudi consulate in Istanbul, as alleged by the Turkish authorities.
Crude oil futures in the US were rising Monday to trade around $72 per barrel.
Saudi Arabia’s riyal was trading at its weakest level in more than a year against the US dollar.
The top Saudi stock market index tumbled by more than 7% over the previous two trading days but was posting a small rebound on Monday.
Nissan delays UK pay talks
Japanese carmaker Nissan (7201.T), which operates Britain’s biggest car factory, has delayed the start of pay talks with its staff in the country until the terms of Brexit become clearer.
London and Brussels hope to reach a deal by next month but automakers have already begun triggering contingency plans in case no deal is reached. The plans include changing their shutdown periods, stockpiling parts and certifying models in the European Union.
Automakers generally sign two-year pay deals with their staff. Nissan was due to start negotiating with its workforce this autumn.
“In agreement with our employee representatives, the 2019/2020 pay negotiations in our UK plant and technical centre will commence in 2019 when we have better clarity on the future business outlook,” a spokesman said.
The firm, which built nearly one in three of Britain’s 1.7 million new cars last year at its Sunderland plant, warned this month that a ‘no-deal’ Brexit would have “serious implications” for British industry.
Suffering Superdry
Shares in Britain’s Superdry (SDRY.L) fell as much as 23% on Monday after the retailer warned that unseasonably hot weather was hurting its sales performance. The company also said foreign exchange issues were leading to millions in unexpected costs for the business.
Superdry shares were already down 47% so far this year due to declining store sales.
With files from Reuters
