FTSE ends another day of sell-offs
16.40 The FTSE 100 recovered some of its losses towards the end of the day, but still ended 0.5pc down at 6,591.
NIESR predicts 0.9pc growth for first quarter
15.15 The National Institute of Economic and Social Research predicts that the economy grew by 0.9pc in the first quarter of the year. Here's what it has to say:
Even though the level of economic output has almost regained its pre-recession peak (January 2008), a sizeable negative output gap remains. With economic recovery still in its infancy, we do not expect the MPC to change monetary policy, via an increase in interest rates, until the middle of 2015.
New French prime minister promises tax cuts
14.45 France's new prime minister Manuel Valls is setting out his policies on taxes, among other things, as the government tries to boost France's economy (incidentally the IMF predicts growth of just 1pc in France this year).
Mr Valls says he will reduce the corporation tax rate to 28pc by 2020 and that low income workers will receive a reduction in payroll charges.
France is for "fiscal seriousness" and against austerity, says #Valls, who must now explain the difference to Brussels.
- Pierre Briançon (@pierrebri) April 8, 2014
IMF: UK will be fastest growing economy in the G7 this year
14.25 Olivier Blanchard, the IMF's chief economist, is speaking following the release of the IMF's economic report. He is urging the eurozone to do more to avoid deflation, potentially introducing quantitative easing
Blanchard: "Still a risk of deflation in the eurozone. Would make growth very very difficult. Everything should be done to try to avoid it."
- Ed Conway (@EdConwaySky) April 8, 2014
BLANCHARD SAYS SOONER IS BETTER THAN LATER ON ECB MOVES. ECB moves that don't involve "costs outweighing benefits" QE right?
- zerohedge (@zerohedge) April 8, 2014
Interesting map of IMF Forecasts. http://t.co/dJxwLGyvCi http://ift.tt/1eeMoLZ
- Daniel Moss (@DanielMossDC) April 8, 2014
14.00 Just announced: The International Monetary Fund reckons the UK will grow faster than the US, Germany and Japan in 2014.
The IMF has upgraded the UK's 2014 growth forecast from 2.4pc to 2.9pc.
This is the first time since 2008 that the UK has led the G7 in terms of growth predictions.
The IMF has forecast the UK to grow faster than than any other G7 economy in 2014
- HM Treasury (@hmtreasury) April 8, 2014
Szu Ping Chan has the full story :
The IMF upgraded its forecasts for UK growth on Tuesday by more than any other advanced economy. It said cheaper credit and increased consumer confidence had helped the UK economy to "rebound more strongly than anticipated" over the past year.
The Fund now expects Britain to grow by 2.9pc this year, from a forecast of 2.4pc in January and 1.9pc last October. By comparison, it expects the US to grow by 2.8pc in 2014 and Canada to grow by 2.3pc, making Britain the fastest growing economy in the G7.
It is the first time since April 2008 that Britain has led the G7 in terms of growth, and the IMF said output could be even higher this year than its official projection because increased confidence had "created stronger-than expected growth momentum". UK growth in 2015 was also upgraded to 2.5pc, from 2.2pc.
Greece says it's on track to return to bond market
13.05 Greek's government says it could return to the bond markets soon after a successful sale of six-month treasury bills this morning. The yield on the notes fell to 3.01pc from 3.6pc last month, and Greece is rumoured to be returning to long-term debt.
Christos Staikouras, the Greek finance minister, said the auction showed that Greece is on "a return trajectory" to bond markets.
Tech break continues into Tuesday
12.30 Traders appeared to have halted yesterday's decline in tech stocks this morning, but the market has turned into a sea of red. Compare the screenshot at 08.15 this morning to how things look now.
Reuters
Reuters
Online retailers are getting pummelled again, with Asos, Boohoo.com, AO World and Just-Eat all falling heavily.
The FTSE is down 0.95pc at 6,559.85.
Manufacturing data 'suggests 1pc growth in first quarter'
12.15 Martin Beck, senior economic advisor to the EY ITEM Club, says today's industrial production data suggest a very impressive rate of first quarter growth:
February's healthy numbers for industrial output point to growth in the sector for Q1 as a whole coming at around 1pc. We expect that quarterly GDP growth could also expand at a similar rate, with the risks potentially lying to the upside. So a strong and increasingly better balanced recovery continues.
Pound jumps to highest level for almost a month
11.25 Sterling has been driven up by those manufacturing figures, which in itself could damage manufacturing exports, according to Mike Rigby, head of manufacturing at Barclays
Macro-economic factors for Manufacturers continue to be broadly favourable with optimism across most sectors on the rise. However, one area to watch is the general appreciation of sterling and the challenge this places around exports. That said, on balance, the outlook for the sector remains positive with forward looking order books looking increasingly evident.
11.10 Following that manufacturing data, the dollar value of a pound has leapt by a cent to $1.6712.
This is the highest level since March 13. Here's the movement over the last month:
Image: Bloomberg
Here's Alex Edwards, head of the corporate desk at UKForex:
Both the Manufacturing and Industrial Production data printed stronger than expectations this morning. These are very impressive numbers and will serve to boost expectations for an early rate hike by the BoE, perhaps even as early as January or February next year, and certainly before the UK general election in May 2015. Although the UK PMIs were weaker than expected last week, these, too, were largely strong numbers. This data will continue to lend medium-term support to the pound, and we'll likely see a move on 1.68 in GBP before long.
FTSE remains weak, continues fall
10.50 In the wake of Monday's 1.1pc drop, the FTSE 100 remains weak and is now down 0.6pc, or 37 points, at 6,585. Renewed concerns about the Ukraine crisis have not helped market sentiment, although the sell-off in tech stocks, which characterised Monday's fall, has abated. Microchip designer ARM Holdings is up 1.3pc after declining 2.4pc a day earlier.
Treasury committee questions ABI on Budget
10.40 Mr Thoresen is asked how many people will not take an annuity.
Those with £30,000 or less are likely to take the cash and deploy it alternatively. At the higher levels I think you'll see more choose to take an annuity eventually.
There'll be cash for people with relatively small pots. At a point when you're older and you want the guarantee you move into an annuity position.
In the next 5-10 years you'll see lower levels of annuity and then as people get older, growth again.
10.35 Mr Thoresen is asked how pension sellers have reacted to the Budget - for example people that would be buying annuities now. He says they have extended "cooling off periods" - the time during which retirees have to buy an annuity.
We are hoping to make an announcement in the next couple of days on how that will play out
10.25 MP Mark Garnier how much the insurers knew about the FCA's review into pension selling beforeThe Telegraph disclosed details of the FCA's review of policy selling .
We first heard about the plans of the regulator to carry out a systematic review in February. We were told to keep it totally confidential.
On the night before the Telegraph article we were told [about the article]. We still hadn't seen the substance of what the thematic was going to be.
Back to FCA closed-book probe: Thoresen says ABI aware it was in regulator's thinking as far back as December, but sketchy details only.
- IFAonline.co.uk (@IFAonlineUK) April 8, 2014
10.20 Mr Tyrie moves on to the Budget's annuity reform. "Is this shock therapy?" Mr Thoresen partly blames low interest rates for low returns.
I think when it was announced it was certainly a surprise. The first aspect was the macro factors that affect the market. Those aspects create an environment where annuities are challenged at a number of levels.
The second factor is the effectiveness of the market. The industry has been working to improve levels of shopping around and levels of switching
10.10 We're off. Committee chairman Andrew Tyrie asks Mr Thoresen aboutthe FCA blunder which saw millions wiped off insurers' shares .
If you look at the impact it had on share prices on Friday, you can see how confused the market was. This has not been helpful.
10.05 The Treasury Select Committee is gearing up to hear the thoughts of Association of British Insurers Director General Otto Thoresen on the effects of George Osborne's recent Budget, which scrapped the requirement for pensioners to buy an annuity.
We're just waiting for proceedings to start. You can follow them here .
Sports Direct falls on share sale
09.55 Back in the stock market, Monday's news that Mike Ashley was slashing his stake in Sports Direct through the sale of 25m shares has weighed on the retailer, which is down 6.4pc in early trade. Associated British Foods, the sugar to clothing conglomerate, is also off 3.6pc in the wake of a profit warning from German peer Suedzucker.
Manufacturing output smashes expectations
09.30 A big beat for manufacturing output - the sector expanded by 1pc between January and February according to data from the Office for National Statistics.
This meant 3.8pc growth compared to a year ago - the best for three years. Economists had expected a month-on-month rise of 0.3pc and a 3.1pc annual increase.
The annual growth was the fastest since February 2011. Industrial production figures also beat expectations.
Good looking production numbers. Industrial production up 0.9% February, manufacturing 1%. Annual increases 2.7% and 3.8% respectively.
- David Smith (@dsmitheconomics) April 8, 2014
FTSE still fragile
09.10 The FTSE 100 has drifted down 14 points to 6,608 and, after yesterday's global sell-off, market sentiment remains fragile, according to Mike McCudden, head of derivatives at broker Interactive Investor:
As investors hit the panic button ahead of US earnings whilst tension in the Ukraine goes back on the boil there appears to be little information presently to warrant a move back in to equities. Whilst there may be relative calm this morning after yesterday's bloodbath investors are hanging out on the side-lines in the hope for some justification for a move back to higher ground.
Japan holds stimulus steady, posts first surplus in five months
09.00 Japan has posted its first surplus in five months, a welcome boost for the government as it grapples with the huge debt the world's third-largest economy has amassed and rising energy imports following the end of its nuclear power industry.
Meanwhile, the Bank of Japan has held firm on its stimulus plan despite calls for more quantitative easing. It plans to increase the money supply by 60-70 trillion yen this year.
IMF to upgrade UK economy
08.30 The International Monetary Fund will release its biannual World Economic Outlook later today, and is expected to upgrade global growth forecasts on the back of stronger performances from the world's developed economies.
A year after the IMF urged Osborne to abandon austerity, it is expected to upgrade its forecast for the British economy this year from 2.4pc predicted in January.
Christine Lagarde, the head of the IMF, may repeat last week's call for quantitative easing to fend off eurozone deflation. Jeremy Warner warns against this in today's column .
Ms Lagarde's clear implication, also apparent in pre-released papers from the IMF's World Economic Outlook, due to be published on Tuesday, is that the world, and particularly Europe, needs a bit more inflation.
I don't necessarily disagree with this, but I would be very wary about doing it in the manner Ms Lagarde suggests - through further central bank money printing.
The big fear about quantitative easing when the US and Britain first started doing it was that it would be inflationary. Images of Weimar Germany's hyperinflation were quickly brought to mind. Yet so far it has proved nothing of the sort. One thing it has done, however, is put a rocket under asset prices.
There is a huge and very varied volume of academic research on the causes of this phenomenon, which I don't intend to rehearse here. Suffice it to say that the effect of QE has been to prevent the sort of adjustment that would normally take place after such a prolonged period of asset price growth. The concern about QE has therefore shifted from initial fears of an inflationary meltdown, which proved groundless, to that of its long-term consequences for financial stability and wealth distribution.
FTSE halts losses
08.15 Traders in London have had their fill of corrections this morning, however: After yesterday's 1.1pc decline, the FTSE 100 is trading flat at 6,620.
It's a mixed picture for the technology stocks that dragged the market down yesterday. While Asos and Ocado have lost more ground this morning, ARM Holdings and Imagination Technologies, the microchip designers, have gained a little ground.
Here are some of the stocks that were under pressure yesterday. As you can see, it's a mixed picture.
Image: Reuters
Tech sell-off continues
07.55 A sell-off of technology and internet companies in the UK continued into the US yesterday and Asia this morning.
In the States, LinkedIn, Yahoo! and Google all saw declines, and the Nikkei has closed down 1.4pc this morning.
In Korea, Samsung has fallen 0.2pc after estimating operating profits in the first quarter would fall by 4pc to £4.8bn. The company is pinning its hopes on the new Galaxy S5 to return to profit growth.
Today's business stories
07.30 Here's what's leading our business pages this morning
* Barclays has avoided an embarrassing High Court trial over claims its senior executives were aware of attempts to rig Libor, reports Harry Wilson
* Fears that a second dotcom bubble is about to burst triggered a global sell-off of technology shares yesterday , write James Titcomb and Ben Martin
* And Jeremy Warner argues that the IMF has failed to spot the dangers of quantitative easing
Good morning
07.30 Good morning and welcome to our daily business and markets live blog, your one stop shop for all the breaking business stories of the day.