Rouble recovers on hopes for Biden-Putin talks, flash PMI surveys in focus – business live | Business

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

The week has started on a calmer note with news that US president Joe Biden and his Russian counterpart Vladimir Putin have agreed to meet to discuss the Ukrainian crisis.

The French president, Emmanuel Macron, has invited Putin and Biden to attend a summit aimed at de-escalating the Ukraine crisis, and the leaders have agreed in principle, Macron’s office has announced, amid further US warnings that war is imminent.

The Russian rouble fell to a one-week low but has since recovered to trade up 1% against the dollar. It is now at 76.5 after touching 77.69 in early trade.

While tensions on the Ukraine-Russia border ramped up over the weekend, European markets are expected to rise slightly at the open. US markets are off for President’s Day.

Brent crude, the global benchmark for Russia’s main export (oil), is down a fraction at $93.45 a barrel. Gold – seen as a safe haven investment in times of trouble – has eased 0.5% to $1,888.54 an ounce after hitting an eight-month high of $1,891.33 an ounce.

However, markets remain on edge, and Asian stocks are mostly down today, with Japan’s Nikkei losing 0.78% and Hong Kong’s Hang Seng down 0.83%.

Last week, the UK’s FTSE 100 index had its worst week since late November, when the discovery of the Omicron Covid-19 variant rocked markets. The blue-chip index lost 1.9% after a big tumble last Monday.

In Japan, a key parliamentary committee has approved the government’s record 107.6 trillion yen (£690,000) spending plan for the next fiscal year, paving the way for the budget’s full passage through the legislature next month.

The highlight on the economic front are flash estimates for closely-watched business surveys from Markit for February, released this morning for the eurozone and the UK.

Michael Hewson, chief market analyst at CMC Markets UK, has looked at this.

The outlook for the French and German economy continues to look uncertain, although after a weak December the German economy did see a modest bounce back in January.

In the UK, December saw a sharp fall in services sector activity, to 53.6 from 58.5 in November, a move that saw a slight recovery in January, despite the Plan B restrictions which were brought in by the UK government half way through the month due to concerns about the Omicron variant.

The restrictions on the hospitality sector clearly hit pubs and restaurants, as well as some retail outlets, but we still saw a recovery to 54.1. With the gradual lifting of restrictions midway through January we could see a further rebound to 55.5 although it is likely to be tempered by caution over the rise in the cost of living.

Manufacturing activity in the meantime was steady, slipping modestly to 57.3, however selling price inflation has remained at record levels, a trend that looks set to continue. On the bright side new orders and employment also rose, with the hope that this will continue into the first quarter.

The Agenda

• 8.15am GMT: France Markit manufacturing, services and composite PMIs flash for February
• 8.30am GMT: Germany Markit flash PMIs for February
• 9am GMT: Eurozone Markit flash PMIs for February
• 9.30am GMT: UK Markit flash PMIs for February (forecast composite: 55)
• 3.15pm Treasury Select Committee hearing on the future of financial services