And finally, here’s a neat graphic summing up today’s UK car sales figures:

And on that note, it’s time to wrap up. Thanks for reading and commenting. GW

Brent crude has now hit a 28-month high, at almost $64 per barrel, as the shockwaves from the Saudi ‘corruption crackdown’ ripple through the oil market.

The purge of Saudi princes and officials has sparked speculation that instability in Saudi Arabia could affect oil supplies in the future.

Michael Loewen, a commodities strategist at Scotiabank in Toronto, explained to Bloomberg that:

“The geopolitical supply risk premium is starting to bear its head in the market right now because OPEC supply cuts have made it relevant.”

Loewen added that, with supply capped and demand rising, potential risks to supply become more significant.

The drop in UK car sales didn’t deter City traders from pushing the Footsie to tonight’s closing high.

Energy firms rose, tracking the oil price after Brent crude hit that two-year high this morning.

Mining firms also had a good day, thanks to a pickup in the copper price.

Connor Campbell of Spreadex explains:

Arguably, the UK index should have done better given the showing from its commodity stocks. BP and Shell jumped 0.8% and 1% respectively as Brent Crude crossed $62.50 for the first time in 2 years following an ‘anti-corruption’ blitz from Saudi Prince Mohammed bin Salman, with investors barrelling into the commodity as they weighed up the potentially destabilising effect this will have on the country’s oil output.

Copper also got a boost this Monday, surging 1.2% as the markets got to grips with the idea that the metal will see a sharp increase in demand as electric vehicles becomoe more popular. This in turn led the UK’s miners higher, with Riot Tinto up 1.7%, Anglo American up 2% and BHP Billiton up 2.7%.

Here’s our news story on the latest drop in UK car sales, for those just tuning in:

New car sales have declined for the seventh month in a row, falling more than 12% in October as worsening confidence among consumers and businesses continues to dampen the market.

The figures show that the car market is on course for its first annual decline since 2011 and will continue to fall next year before stabilising in 2019, according to the Society of Motor Manufacturers and Traders (SMMT).

The industry body said car registrations dropped 12.2% year-on-year to 158,192 last month – the second double-digit decline this year. It is an acceleration from the 9.3% fall in car sales in September, the first time the market had declined in September in six years. In April, sales plummeted 19.8% after an increase in vehicle excise duty.

Diesel sales tumbled by nearly 30% last month after the scandal over rigging emissions tests and political rumblings over restrictions on diesel cars. Demand for electric and hybrid cars continued to rise, up by nearly 37% to 8,244, while petrol models posted a small increase of 2.7%.

Mike Hawes, the SMMT chief executive, said: “Declining business and consumer confidence is undoubtedly affecting demand in the new car market, but this is being compounded by confusion over government policy on diesel. Consumers need urgent reassurance that the latest, low-emission diesel cars on sale will not face any bans, charges or other restrictions, anywhere in the UK.”

More here:

Labour MP Chuka Umunna MP has warned that the drop in UK car sales shows that Brexit is hurting the economy.

He says:

“This is yet more evidence that the Brexit squeeze is already hitting working people and businesses alike.

“The rise in inflation – directly caused by the Brexit vote – has forced up prices and interest rates, deterring people from buying big-ticket items like cars.

“The British people were promised that leaving the EU would make us better off, when in truth it is hitting growth, raising prices, and squeezing family budgets. Voters have the right to keep an open mind about our future when they see that the darkening reality is so far away from the Government’s sunny rhetoric.”

The US stock market has opened for trading after a silence for the victims of yesterday’s Texas church shooting...

..... and the Nasdaq index has hit yet another record high.

That’s partly thanks to Broadcom’s takeover bid for Qualcomm. Qualcomm’s shares have jumped by over 4%, while Broadcom are up 2%.

There are reports that Qualcomm will reject Broadcom’s advances, which is pitched at a 28% premium to Friday’s closing price.

After hitting a two-year high this morning, Brent crude still up - and trading at $62.30 per barrel.

Kathleen Brooks of City Index says the shake-up and crackdown in Saudi Arabia is the ‘key driver’ behind Brent’s rally.

Last week the Saudi Arabian oil minister said that he supported another Opec production cut, set to be announced when Opec next meets later this month. This weekend an anti-corruption drive by Prime Mohammad bin Salman has seen the arrest of the well-known champion of capitalism Prime Alwaleed bin Talal among other officials and has rattled investors, stock exchanges across the Middle East have fallen at the start of this week. However, this hasn’t hurt the oil price as yet.

The reason that Brent has rallied even when other Saudi-based assets have struggled, could be two-fold: the extension of the Opec production cut is a powerful driver of oil in the short term, and Brent could be acting as a safe haven in the midst of the confusion around the anti-corruption drive and Prime Mohammad bin Salman’s shifting economic agenda.

More here:

Most European stock markets have lost a little ground today, as this chart shows:

David Madden of CMC Markets blames profit taking, after stocks reached record highs last week:

European equity markets are slightly in the red as traders lock in their profits from last week’s broadly positive move.

The DAX and the CAC 40 saw fresh record highs last week, while the FTSE 100 hit a multi-month high, so a small pullback today is hardly surprising.

Over in America, the New York Federal Reserve has confirmed that its president, William Dudley, is retiring early next year.

That means more upheaval at the US Federal Reserve, just a few days after Donald Trump announced that Jerome Powell will succeed Janet Yellen as Fed chair next year.

Labour leader Jeremy Corbyn is now addressing the CBI’s annual conference.

On Brexit, he says the UK needs to agree a transition deal soon.

Delaying a transition deal until the final Brexit deal has been agreed is “simply not good enough”, says Corbyn (something BT’s Gavin Patterson presumably agrees with).

My colleague Andrew Sparrow is liveblogging the speech in his Politics Live blog:

Over in the City, shares in car dealership Inchcape have fallen by 2.7% this morning, to the lowest level since mid-July.

Traders seem to be reacting to this morning’s weak UK car sales figures, say analysts at MorningStar:

Simon Benson of AA Cars says the government’s crackdown on older ‘dirty diesel’ cars is having a major impact - with sales down 30% year on year in October.

Benson says:

“Despite registrations of alternatively fuelled vehicles rising and a slight uplift in sales of petrol cars, the overall market was down by more than 12% last month as these efforts failed to balance out diesel’s sharp decline.

“With the widespread uncertainty and general confusion surrounding diesels and the potential for charges and restrictions in London and other major cities, a distinct lack of buyer confidence is the primary reason for this dramatic drop.

Back in July, the government outlined plans to ban new petrol and diesel cars and vans from 2040, as part of a crackdown on air pollution.

Industry figures have hoped that consumers would move to Euro 6 diesels (which heat Europe’s new, tougher emission standards). Today’s data, though, suggests that many are shunning diesels, amid signs that the second-hand value of older diesels has slumped.

Back in the eurozone, optimism among investors has hit its highest level in a decade.

That’s according to Sentix, the research group. It’s eurozone investor confidence gauge soared to 34 this month, up from 29.7 in October .

That’s the best reading since July 2007 (just before the credit crunch struck).

Sentix also found that investor sentiment towards Germany has hit an all-time high, following its strong growth this year (as highlighted by this morning’s factory orders figures).

Economist Danny Blanchflower reckons the decline in UK car sales shows that the Bank of England was wrong to raise UK interest rates last week.

Alex Buttle of car buying comparison website Motorway.co.uk isn’t surprised that diesel car sales have slumped by 30% year-on-year.

He blames the emissions scandal, in which manufacturers used ‘cheat software’ to hide how much pollution they were creating. With Paris planning to ban diesels by 2024, consumers seem to be voting with their wallets.

Buttle says:

“These figures make depressing reading for the car industry. Petrol and alternative fuel figures were actually up in October, but diesel sales continue to flounder.

“Diesel’s market share is plummeting and consumers aren’t listening to rhetoric about cleaner diesel models, however much the industry drums on about it. The damage has been done.

“While it’s understandable the SMMT is not deserting diesel and urging the government to act to reassure consumers that new diesel cars will be ‘safe’ from toxin tax punishment, is this a lost cause? Maybe it’s time focus is shifted towards giving attractive tax incentives for purchasing alternative fuel vehicles to encourage growth in this area.

“Consumers are showing huge interest in eco-friendly cars and it’s reflected in new registrations. AFVs are the future of the car industry and the government need to adapt to changing times if it has any interest in keeping the new car market buoyant.”

The outlook for UK car sales looks “bleak”, warns Samuel Tombs of Pantheon Economics.

He says that the 12.2% slump in October is “alarming”, and shows that consumers are very reluctant to make financial commitments at present.

Last week’s interest rate rise, from 0.25% to 0.5%, could also hurt demand, he fears.

Tombs writes:

Worryingly, sales are falling rapidly even though generous discounts are available for buyers trading in old, high-polluting diesel vehicles. Most manufacturers’ diesel scrappage schemes are set to close at the end of this year. The recent further decline in consumer confidence, meanwhile, indicates that car registrations will continue to fall well into 2018.

The downward trend likely will be amplified by increases in personal loan rates in response to last week’s Bank Rate hike. Accordingly, the outlook for car sales looks bleak.

This chart highlights how sharply UK car sales have declined this year:

Tony Burke, assistant general secretary at the Unite union, blames the ‘chaos’ around Britain’s exit from the European Union:

The fall in UK car sales has accelerated over the last three months, making October’s year-on-year decline the biggest since April:

• January: +2.9%
• February: -0.3%
• March: +8.4%
• April: -19.8%
  
• May: -8.5%
  
• June: -4.8%
  
• July: -9.3%
  
• August: -6.4%
  
• September: -9.3%
  
• October: - 12.2%

(because of monthly fluctuations, UK car sales are compared to the same month a year ago).

Although diesel sales slumped, Britons actually bought more electric cars in October.

Sales of alternatively fuelled vehicles rose by 36.9% year-on-year, with 8,244 new models registered during the month.

That pushed sales of AFV’s through the 100,000 mark, up from around 75,000 a year ago.

We also have strong economic data from France.

The French private sector grew at its fastest pace in over six years in October, according to data firm Markit’s monthly healthcheck.

Service sector firms and manufacturers both reported that activity was strong, pulling the French ‘composite PMI’ up to 57.4 (any reading over 50 shows growth).

Germany companies also posted solid growth - although not quite as fast as in September. The German composite PMI dropped to 56.7, from 57.7.

Italy, though, came off the boil, with the slowest rise in service sector growth since last autumn.

Today’s car sales figures come at a nervous time for the auto industry.

Last month, car dealership chain Pendragon shocked the City with an unexpected profits warning which sent its shares careering to a four-year low.

Car makers are also worrying about Brexit, as they currently benefit from Britain’s membership of the single market and the customs union. Production across the industry has fallen for the last five months, with new investment on hold until there’s more clarity over the UK’s future.

Vauxhall is already planning to swing the axe, with 400 jobs going at its site in Ellesmere Port, near Liverpool.