Hedge funds ‘selling pound ahead of Budget’
Thanks for joining us. The Chancellor has been warned that increasing capital gains tax in the Budget might raise less revenue and hurt economic growth.
Economists at the Centre for Policy Studies (CPS) said potential tax rises could lead to “an exodus of wealthy investors, entrepreneurs and job creators from the UK”.
5 things to start your day
1) Reeves warned over £50bn ‘debt fiddle’ | Chancellor pledges changes in Budget amid investors’ fears over borrowing binge
2) Reeves has handed herself an extra £50bn. This is where she could spend it | Changes to debt rules will allow the Chancellor to boost investment across a range of sectors
3) Heat from data centres and factories to warm thousands of homes | The Government wants heat networks to cut city centre carbon emissions
4) Liverpool scaffolder who started protein shake company lands £62m payday | Former workman sells off 19pc stake as Applied Nutrition lists on London stock market
5) Ambrose Evans-Pritchard: Trump’s nostalgia for 19th-century tariffs has alarming implications for the world | The former president’s trade team is playing with global fire
What happened overnight
Asian stocks were mostly higher aside from in Japan, where investors were awaiting the outcome of an election on Sunday.
Japanese Prime Minister Shigeru Ishiba, who took office just weeks ago, called the snap general election to drum up support as the ruling Liberal Democrats grapple with a political funding scandal.
Recent upheavals have added to uncertainty for markets, complicating the Bank of Japan’s efforts to shift away from long-standing near-zero interest rates.
Core inflation in Japan’s capital was 1.8pc in October, lower than the central bank’s 2pc target for the first time in five months, the government reported. That reinforced expectations that the central bank will keep its key interest rate unchanged at a policy meeting next week.
Tokyo’s Nikkei 225 index lost 1pc to 37,771.79, while the Japanese yen rose against the US dollar.
Hong Kong’s Hang Seng added 1.1pc to 20,720.60, and the Shanghai Composite gained 0.8pc to 3,307.14.
China’s central bank kept its medium-term lending rate unchanged at 2pc. It also issued 700 billion yuan (£75.8bn) in one-year medium-term lending facility loans to financial institutions, according to the bank’s statement.
Elsewhere, South Korea’s Kospi climbed 0.3pc to 2,590.30 and Australia’s S&P/ASX 200 climbed 0.1pc to 8,216.50. Taiwan’s Taiex increased 0.3%.
On Wall Street, the Dow Jones Industrial Average fell 0.3pc to 42,374.36, the S&P 500 rose 0.2pc to 5,809.86 and the Nasdaq Composite advanced 0.8pc to 18,415.49.
In the bond market, the yield on 10-year US Treasury notes dipped to 4.217pc from 4.231pc late on Wednesday. It has risen from 3.623pc on Sept 16.
The yield has been rising in recent weeks partly because both candidates in the US presidential election are keen on spending money, which will widen the deficit, according to Mark Malek, chief investment officer at SiebertNXT in New York.
Source: telegraph.co.uk
