WSJ City’s Brexit Briefing: Getting to Grips With Brexit Data, European CEOs Plan Higher Spending, WPP Cautious Despite Sales Boost

WSJ City UK View this email in a web browser By Darren Lazarus Good afternoon from London. Here's essential reading for the City on today's Brexit developments.  Two months on from the Brexit vote, both Leavers and Remainers say they have been proven right about the short-term impact of the referendum on the UK economy. Remainers point to the collapse in business confidence and dismal PMI surveys in July. Brexiters say many post-vote surveys reflect a knee-jerk reaction that has since reversed. The British Bankers Association said on Wednesday that private credit to non-financial firms grew in July, leading some to believe a recession is unlikely. But in truth, economists say it's simply too soon to make any concrete conclusions. Eurozone businesses plan to raise their investment spending despite the Brexit vote, according to a survey by Swiss bank UBS.  Before the referendum, economists feared a vote to depart the EU could weaken business confidence across the bloc. But UBS said interviews with chief executives and chief financial officers at 660 companies between July 5 and Aug. 8 suggest investment spending is set to rise despite the greater uncertainty that has followed the June 23 vote. Advertising giant WPP suggested that a fall in the pound may have led to "a post-Brexit-vote recovery," saying that trading strengthened in the UK in July.  However, the company, which reported a 4.3% rise in comparable net sales, remained cautious. "One swallow doesn't make summer," it said. CEO Martin Sorrell added that Brexit, in the longer term, could lead to a drop in gross domestic product in Europe and possibly globally. Two months after the Brexit vote, there is a consensus that commercial real estate here is now worth less. But how much less? No one can quite agree. The valuation problem reflects the difficulty of saying how much things are worth in a market that has just experienced an unusual shock. It doesn't help that few transactions are taking place. British government bonds have been on an astonishing tear in the months following the Brexit vote, and the speed of the move is raising concerns about what comes next. The yield on 10-year gilts plunged from 1.36% on the day of the EU referendum to just 0.54% on Tuesday afternoon. That's left some analysts wondering if the UK will mimic last year's so-called bund tantrum, when eurozone bond yields shot higher without an obvious reason. Central bankers are making renewed use of so-called macroprudential policies. Through so-called "countercyclical buffers," which force banks to raise more or less capital as a share of their assets, officials are now able to squeeze the supply of credit in a boom and ease it in a bust. The Bank of England did just that after the Brexit vote, slashing this buffer from 0.5% to zero to give a helping hand to financial institutions. Officials said they expected banks to respond by supporting the economy with fresh loans. Download WSJ City for iPhone here or Android here  You'll need to open this email on your mobile device to do this. And please feel free to send this newsletter to your friends and colleagues. In The Papers Owen Smith Pushes for Referendum on Terms of Brexit Agreement – The Times German Economic Growth Slows on Lower Investment – WSJ Lobbyists Roll Out Big Guns to Help Businesses Quit Europe – The Times Housing Market on Hold as Cautious Buyers Stay Away After Brexit Vote – Telegraph Brexit Advances Plans to Create a European Army – The Times Markets Today London's FTSE 100 closed lower as a fresh decline in oil prices continued to weigh on shares. The UK's benchmark stock index was 0.5% down on the day, underperforming all other major European country indices. Randgold Resources was the biggest faller, down more than 4.5%, as the price of gold fell, while Antofagasta, Anglo American and Glencore were down too. Brent was around 2.5% lower on the day at below $49 per barrel at stock market close in London, as reports of additional US crude stocks overshadowed hopes Iran could agree to a production freeze accord. Indices on Wall Street dipped slightly, with investors cautious ahead of this week's central bankers gathering at Jackson Hole. Market Snap at 24/08/2016 16:04:36 GMT FTSE 100 Futures -0.55% GBP/USD 0.31% EUR/USD -0.41% Brent Crude Futures -2.1% Gold -1.24% 10-year Bund Yield -0.092% Advertisement Follow WSJ City Follow WSJ Unsubscribe• Newsletters & Alerts• Contact Us• Privacy Policy• Cookie Policy SUBSCRIBE FOR FULL ACCESS TO WSJ.COM SIGN UP FOR THIS NEWSLETTER You are currently subscribed as jasajuejejeje@gmail.com For further assistance, please contact Customer Service at support@wsj.com Copyright 2016 Dow Jones & Company, Inc. All Rights Reserved.