E.On post second straight loss
UK ‘big six’ energy provider E.On posted a loss for the second year in a row on Wednesday, as wholesale electricity prices hit a record low.
E.On saw annual net losses more than double in 2015 to 7 billion euros, above analysts expectations of a loss of 6.48 billion euros. The company also wrote down the value of its loss making power plants by 8.8 billion.
The company cited record low wholesale prices, as well as the German government’s move towards renewable energy taking a hit to profits. It is the second year that E.On has reported a loss.
Losses for Asian markets
Asian markets saw sharp losses on Wednesday, falling further from its two-month highs due to weak-trade figures from China and further oil price fluctuation.
The Shanghai Composite index and the CSI 300 fell around 2.4 percent before closing down 1.34 percent and 1.15 percent respectively. Hong Kong’s Hang Seng slipped 0.4 percent, with the Nikkei closing down 0.84 percent.
Warnings issued for UK economy and beyond
Bank of England Governor Mark Carney has spoken out against the Brexit campaign in his strongest statement yet, saying that leaving the EU could damage the UK’s financial centre.
Carney reiterated that he was not making any recommendation on how to vote, but made it clear that he believes the UK’s $2.9 trillion economy could be battered by a vote to leave, with global banks choosing to move away from London.
His statement came on the same day as the International Monetary Fund (IMF) warned that the global economy faces a growing “risk of economic derailment” and must intervene to promote demand.
David Lipton, second in command at the IMF, said in a speech at the National Association for Business Economics in Washington on Tuesday:
“The IMF’s latest reading of the global economy shows once again a weakening baseline,” he said. “We are clearly at a delicate juncture.”