The eurozone construction industry returned to growth for the first time since the start of the pandemic in March, according to a survey that adds to signs that the economic recovery from coronavirus lockdowns is underway.
The construction purchasing managers’ index (PMI) from IHS Markit jumped from 45 points in February to 50.1 in March - just above the 50 mark that indicates the sector is growing.
New orders received by eurozone construction firms returned to growth in for the first time in 13 months in March, IHS Markit said.
Usamah Bhatti, an economist at IHS Markit, said:
Eurozone construction companies reported fractional growth in March, marking for the first increase since the pandemic disrupted activity across the bloc throughout 2020.
Incoming business also expanded in the latest survey period, as the appetite for new construction projects in the eurozone began to return, reportedly in public sector work.
Asos profits triple as pandemic boosts sales
Asos has more than tripled first half profits to a record £113m and raised full year expectations as the online retailer continues to prove to be a major winner during the pandemic.
The company also said that the Topshop, Miss Selfridge and activewear brand HIIT brands, acquired from Sir Philip Green’s Arcadia empire for £330m in February, have been “seamlessly” integrated into its online platform and have seen “great early customer momentum”.
Asos reported a 253% year-on-year increase in pre-tax profits to £106.4m in the six months to 28 February, as total group revenues climbed 24% to £2bn.
Australian government monitoring GFG steel developments
Australia’s government has signalled that it may consider providing financing to mining operations owned by GFG, the metals conglomerate owned by Sanjeev Gupta, which faces further legal action seeking to wind it up.
Gupta’s metals empire has come under intense pressure after its key lender, Greensill Capital, collapsed. Gupta has been scrambling to find new lenders to replace as much as $5bn (£3.6bn) lent by Greensill.
Credit Suisse, the bank which funded Greensill’s loans (and which is facing its own pressures), this week filed to liquidate two of GFG’s Australian businesses. Credit Suisse has already made a similar move in London.
Citibank, acting on behalf of Credit Suisse, applied for courts in New South Wales to wind up Onesteel Manufacturing, which operates the Whyalla steel operation in South Australia, and Tahmoor Coal.
Simon Birmingham, Australia’s finance minister said the government was monitoring developments, with an initial hearing not scheduled until 6 May. Reuters reported that he told ABC radio on Thursday:
Governments are monitoring this situation very closely and indeed doing the type of contingency thinking and planning that that would be prudent in these sorts of circumstances.
He said financing options provided the last time the steelworks moved into administration were being considered.
Our government continues just to make sure we are looking at those examples from the past and being mindful of how we could respond if we need to.
Introduction: Markets gain after Federal Reserve points to longer support
Good morning, and welcome to our live, rolling coverage of business, economics and financial markets.
The one constant through the coronavirus crisis has been the willingness of the Federal Reserve and other central banks to stand behind markets. They were at it again last night in Washington, with minutes from the latest monetary policy meeting giving the soothing message that support is here to stay.
Stock markets in Europe rose on Thursday in early trading after the Fed said it expected to keep loose monetary policy for “some time” until conditions improve sufficiently. The FTSE rose by 0.3% in opening trades on Thursday morning, while the Stoxx 600 index of big European companies gained 0.4%.
Lael Brainard, a Fed governor, told CNBC that policymakers expect “considerably better outcomes on growth, and employment and inflation” in coming months. “But that is an outlook,” she said. “We are going to have to actually see that in the data,” and with millions of jobs still missing due to the pandemic “we have some distance to go.”
Naeem Aslam, an analyst at Avatrade, an online investing platform, said:
Traders have finally understood that there will be no early exit from loose monetary policy. The US economy needs to recover fully, and it will be some time before that happens.
Markets have appeared to shrug off the latest concerns over the AstraZeneca vaccine. UK regulators recommended not giving that particular vaccine to the under-30s because of a risk - albeit vanishingly rare - of blood clots.
This morning in the UK online clothing retailer Asos has delivered a 253% increase in profits thanks in part to a net benefit from Covid.
Miner Anglo American has said it will demerge its South African thermal coal operations.
- 8:30am BST: Eurozone construction purchasing managers’ (PMI) survey (March; previous: 45)
- 9:30am BST: United Kingdom construction purchasing managers’ (PMI) survey (March; previous: 45)
- 12:30pm BST: European Central Bank monetary policy meeting account
- 1:30pm BST: US initial jobless claims (week of 3 April; previous: 719,000; consensus: 680,000)