Crypto News: Mixed fortunes

Hi, I'm Sabah Meddings, a UK Business Reporter at Bloomberg. Here's today's Readout.

Homeowners got some troubling news today from Nationwide Building Society, which reported that house prices are falling at the fastest pace since the global financial crisis. House prices fell 3.8% in the group's July survey, compared to 2022, a deeper drop than June and a third consecutive month of declines.

Unsurprisingly, 13 interest rate increases from the Bank of England since the end of 2021 have dampened the amount consumers are able to pay for properties. And there is likely to be more to come. Bloomberg Economics forecasts that prices will settle at 10% below their August 2022 peak, meaning there could be a further 5.5% fall.

The effect on families is not pretty. Nationwide estimates that people on an average wage, and looking for a typical first-time buyer property, would see monthly mortgage payments swallow up 43% of their take-home pay on a 6% mortgage rate. That's up from 32% a year ago.

The impact of the deterioration in the housing market is playing out in company earnings. Travis Perkins, a buildings supplies company, reported lower revenues and said profits fell by almost a third due to "significant weakness" in the housing sector. Watch out tomorrow for house builder Taylor Wimpey, which will be closely monitored.

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The stories you need to know about this evening

The US tightened entry rules for Hungarians under its visa-waiver program, citing security concerns.
Italian e-scooter sharing firm, Micromobility has submitted a bid to buy struggling Dutch e-Bike Maker VanMoof.
Uber reported a surprise profit as ridership reached a new record.
BP boss Bernard Looney rebuffed criticism that his company overpaid for offshore wind leases in Germany.

We're deep in company earnings season, which is revealing a very mixed picture.

As Harry Wilson and Ambereen Choudhury report, the banks are benefiting from higher interest rates — with HSBC announcing a new $2 billion buyback program. The bank, which makes most of its income from Asia, has become the latest lender to see profits surge on higher lending.

While a boon for shareholders, headlines like these are unlikely to earn the bank sympathy from mortgage holders and UK savers. Lenders are under pressure to pass on more of the rate rise to savers, with Chancellor Jeremy Hunt declaring in June that banks were being too slow. So far only about a quarter of the rises have been passed through, according to the UK's Financial Conduct Authority.

HSBC's results caught the attention of veteran broadcaster Carol Vorderman, who posted on Twitter that with no windfall tax on banks, it should be "drinks all round."

Speaking of drinks, Diageo, the maker of Smirnoff vodka and Johnnie Walker whisky, has also emerged as a winner of the current economic environment. The company said today that it has been able to pass along most of the price increases from inflation to customers.

Analysts are watching food and drinks firms closely for signs that consumers are pushing back on price increases. Diageo, which is known for premium brands, is seen as an affordable luxury for the middle classes and is proving that some customers are remaining resilient.

Compare that to Heineken, the world's second-largest brewer, which yesterday cut its annual profit forecast after more cost-conscious beer drinkers shied away from higher prices.

Photographer: Jasper Juinen/Bloomberg

If HSBC bankers are following Vorderman's advice, it may be one of the last rounds of drinks they enjoy in Canary Wharf. The FTSE 100 firm announced plans to ditch its home in the docklands for a new headquarters in the City. CEO Noel Quinn told Francine Lacqua on Bloomberg TV this morning: "Frankly, we needed a building half the size of Canary Wharf."

P.S — There is finally a spot of good news for consumers, though it's pretty meagre. Prices in UK stores have fallen for the first time in two years — by 0.1%.

Undrinkable. What the new UK alcohol duties mean for the quality of your beverages.

Keeps growing. Here's our QuickTake on what's behind the growing nuclear missile threat from North Korea.

New holiday destination. Cowley Manor Experimental in the Cotswolds has just opened, and it combines Parisian chic with Alice in Wonderland.

Collateral damage. With global demand for coal at record levels, the highways and communities of South Africa are in mayhem.

Can't handle the heat. The Mediterranean is set to be hit by more record-breaking temperatures later this month, after a brief respite from the searing heat and fires of July.

Hotel California. The ultra-rich are flourishing and staying around in California — as the number of millionaires in the state surged.

$151.7 billion

Despite Man Group's assets under management surging to a record $151.7 billion, it's pretax core profit declined in the first half of the year.

One key story, every weekday

The World Trade Bridge connecting South Texas and Mexico. Photographer: Kaylee Greenlee Beal for Bloomberg Markets

US-China tensions and Russia's invasion of Ukraine are leading companies to bring supply chains closer to home. A shift from fossil fuels is spurring demand for materials essential for electrification. Artificial intelligence is forcing employees to learn new skills so they won't be replaced. All these factors are coming together to rewire the $32 trillion spent a year in shipping goods and services.

Read The Big Take.

Please send thoughts, tips and feedback to readout@bloomberg.net. You can follow Sabah on Twitter.

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