UK Oil Receipts Slip

A survey has shown that confidence among Britain’s service sector has fallen to a three year low in the three months to May. Once again the Brexit plays a big, but not solo, part in these findings. Further Brexit related figures come in the form of falling business investment. The fall was 0.5% down from the last quarter and 0.4% lower than this time last year. The ONS pinpointed non-residential real-estate investment as the source of the slowdown, as investors bide their time and wait on the EU referendum outcome

The second estimate of UK GDP figures for Q1 were released this morning, showing no change from the initial 0.4% growth quarter on quarter but year on year growth was revised down from 2.1% to 2%. The news momentarily faltered the FTSE index, before it quickly returned to move higher.

Net migration to the UK rose to 330,000 during 2015, the second highest recorded figure. The findings come at a pivotal point in the Brexit debate and will no doubt add fuel to the fire. 184,000 (net) came from within the EU and the higher figure has been put down to fewer people leaving.

For the first time since records began almost 50 years ago the UK government has incurred a loss on North Sea oil and gas production receipts. Compared with 2014’s £2.15bn profit, 2015 saw a loss of £24m. Corporation tax fell by 74% to £538m as a result of the falling oil prices. The UK government will continue to support the industry, which generated over £10bn to the Treasury just 5 years ago.

At the close the FTSE was near enough flat on a day where the index struggled for direction. The higher shift in oil prices generally led related stocks higher, whilst a host of financials and travel & leisure equities fell on the day. M&S shares fell a further 2.2% as Carnival sat at the bottom of the FTSE 100. American markets similarly look for meaningful movements as we write.

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