Markets in the UK and across Europe saw a rise on Monday, spurred by a strong session in Asia. The FTSE climbed 0.6% in early trade, while Germany's DAX rose 0.5% and France's CAC ascended 0.6%. Meanwhile, US markets were closed for Labor Day.
In the UK, the Centre for Economics and Business Research (CEBR) warned of a rising volume of insolvencies due to the strain of heightened interest rates. The second quarter of 2023 saw over 6,700 insolvencies, double the number seen in a typical quarter during the pandemic. Insolvencies had previously peaked in 2009 during the financial crisis.
CEBR's models suggest that there could be an average of 7,000 insolvencies per quarter across 2024, potentially leading to a recession in the UK with two consecutive quarters of GDP contraction predicted for Q4 2023 and Q1 2024. The food services sector appears to be in the most trouble, with many businesses still repaying debt taken on during the pandemic.
On the housing front, July saw the average cost of rent in England hit a record high of £1,367 per property, a 19% increase from June's averages. This marks a significant month-on-month increase compared to the average increase of 1.3% seen so far this year.
In terms of individual stocks making waves on Monday, housebuilder Persimmon (LSE:LON: PSN ), Rio Tinto (LON: RIO ) (LSE:NYSE: RIO ), and Prudential (LSE:LON: PRU ) all saw increases between 1.4% and 1.8%.
In other global events, leaders convened at the ASEAN Business Summit in Jakarta to discuss business and investment in the Pacific region. British PM Rishi Sunak laid out foreign policy goals at the summit while Christine Lagarde is scheduled to speak at the European Economics and Financial Centre later today.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.
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