Wages rise as UK service sector growth hits 24-year high – business live

Good morning, and welcome to our rolling coverage of the world economy, the financial markets, the eurozone and business.

The oil price has hit a new two-year high, with demand increasing as economies emerge from lockdown, and producers keep supplies curbed.

Brent crude has hit its highest level since May 2019 this morning, hitting $71.99 per barrel, having settled at a two-year high overnight. It’s now more than recovered from its slump early in the pandemic:

The brent crude oil price over the last five years

The Brent crude oil price over the last five years Photograph: Refinitiv

US crude is catching up fast too – hitting $69.40 per barrel, its highest since October 2018.

The rally comes after the Opec+ group agreed to maintain its slow easing of production cuts, and as negotiations continue over the Iranian nuclear deal – which could result in oil sanctions being lifted.

Opec+ struck an optimistic tone about improving demand this week, which helped lift oil – even though it stuck to its policy of slowly relaxing production cuts.

Saudi Arabia’s energy minister, Prince Abdulaziz bin Salman, predicted a demand recovery in China and the US in the coming months, with vaccine rollouts helping to rebalance the oil market.

And overnight, US crude inventory figures showed a larger-than-expected drop in crude stocks – signaling rising demand, as the peak driving season looms in the US.

With European economies reopening after their pandemic lockdowns (although new Covid-19 variants could yet derail these plans), fuel demand could strengthen. And that would potentially push inflation higher in the coming months too.

Naeem Aslam, analyst at Avatrade, explains:

Basically, traders are feeling a lot more optimistic about the reopening of the global economy and the continuation of the vaccination process. In addition to this, if we look at oil supply, it seems like major oil producers are very much maintaining their discipline.

Traders also understand that the US and Iran’s nuclear deal cannot be reinstated that easily, and it will take a while before the previous conditions are enacted. This means no immediate increase in oil supply, and this is also supporting oil prices.

Global Polymer News


▶️ Today #Brent #crude opened higher by 0.85% at 71.96/bbl, while #WTI opened higher by 0.78% at $ 69.37/bbl. pic.twitter.com/5nvUBlioxO

June 3, 2021

Also coming up today

The latest services sector PMI reports are expected to show strong growth in the UK, eurozone and the US….and probably intensifying price pressures as well.

The latest US jobless claims data will be closely watched, ahead of tomorrow’s Non-Farm Payroll (NFP) jobs report for May – which may show a rebound in hiring after April’s slowdown.

We also get the monthly assessment of US private sector payrolls, from ADP.

Markets are looking calm, with investors cautious ahead of Friday’s NFP.


European Opening Calls:#FTSE 7115 +0.09%#DAX 15612 +0.06%#CAC 6526 +0.06%#AEX 719 +0.02%#MIB 25396 +0.06%#IBEX 9176 -0.05%#OMX 2271 +0.12%#STOXX 4091 +0.07%#IGOpeningCall

June 3, 2021

But that doesn’t extend to the ‘meme stock’ world. Yesterday, a frenzy of trading in Reddit favourites saw cinema chain AMC Entertainment’s stock double to new record highs.

Charlie Bilello

Good day for memes…
AMC $AMC: +102%
Koss $KOSS: +71%
Bed Bath $BBBY: +51%
Express $EXPR: +33%
Blackberry $BB: +32%
GameStop $GME: +14%
Sundial $SNDL: +13%
Tilray $TLRY: +12%
Clover Health $CLOV: +12%
Dogecoin $DOGE: +12%
Virgin Galactic $SPCE: +10%
Beyond Beat $BYND: +10%

June 2, 2021

AMC is expected to benefit as lockdown measures are rolled back, and people return to the cinema. It also launched a new platform for its sizable retail investor base – which includes a free large popcorn when attending a movie at AMC this summer.

But even so, the rally is quite remarkable given the company’s pandemic struggles – sending the firm’s value soaring over $30bn (meaning more pain for the speculative hedge funds betting against it).

As Bloomberg explains:

The moonshot surge in the shares of AMC Entertainment Holdings Inc. has vaulted it into the ranks of some of the world’s most valuable companies.

The company has gone from a small cap to a large cap in the space of a few months. A 95% gain amid a retail-trading frenzy on Wednesday left the movie-theater chain with a market capitalization of $31.3bn. That makes it more valuable than half of the companies in the S&P 500 Index.

AMC is now worth more than Tyson Foods Inc. and Delta Air Lines Inc. despite projections for the company to bring in a fraction of their revenues.

The agenda

  • 9am BST: Eurozone services PMI for May
  • 9.30am BST: UK services PMI for May
  • 1.15pm BST: ADP survey of US private sector payrolls
  • 1.30pm BST: US initial weekly jobless claims
  • 3pm BST: US services PMI for May

source: theguardian.com