Today's news headlines:
'Boris Johnson pulls out of Conservative leadership contest'. Former Prime Minister Boris Johnson announced late last night that he had exited the contest to become the next Conservative Party leader and PM after rivals claimed he did not have the required backing of 100 Tory MPs to enter the race on Monday. Former Chancellor and runner-up in the previous leadership contest, Rishi Sunak, is the clear frontrunner to succeed Truss after amassing 144 Tory supporters. Penny Mordaunt is Sunak's only declared rival for the job; however, she has the support of fewer than 30 Conservative MPs. If she does not gain the backing of the 100 MP threshold by 2pm on Monday, Sunak will automatically become Prime Minister. (Financial Times)
'China's GDP growth below target as property and zero-Covid woes mount'. The delayed Gross Domestic Product data from the world's second-largest economy came in well below expectations this morning as markets take a sour view of the Chinese economic outlook. Although surpassing its target of 3.3%, China's GDP grew by 3.9% year-on-year for the third quarter of 2022. However, this still fell short of the full-year target of 5.5%. President Xi Jinping's rule was recently extended for a third term as the country battles with strict zero-Covid controls and lockdowns, which are crippling consumer activity. (Financial Times)
The UK is set to elect its fifth PM in six years today if Mordaunt is unable to find the extra backing she needs to enter the leadership race. In Asia, panic selling of Chinese stocks in the aftermath of the underwhelming GDP data saw the Hang Seng China Enterprises index in Hong Kong fall as much as 7.4% to a 14-year low. The CSI 300 also experienced a negative effect and was down as much as 3.1%.
Chinese GDP q/y: 3.9% vs 0.4% previously
Chinese Retail Sales y/y: 2.5% vs 5.4% previously
EU Flash Manufacturing PMI: 46.6 vs 48.4 previously
EU Flash Services PMI: 48.2 vs 48.8 previously
UK Flash Manufacturing PMI: 9:30AM
UK Flash Services PMI: 9:30AM
US Flash Manufacturing PMI: 2:45PM
US Flash Services PMI: 2:45PM
US Treasury Secretary Janet Yellen Speaks: 4:00PM
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