11 April 2018

@Stu_7_tay

11 April 2018

Good morning,

Theresa May is waking up this morning still facing the dilemma of how the UK should respond to Saturday’s suspected chemical attack by the Assad regime in Syria.
 
The prime minister has spoken with President Trump and President Macron and while they agree that an international response is necessary, what shape it should take remains undefined.
 
The US has made it clear that their preference is for any military response to include European allies, but May has major decisions to make before then. Does she trust her instinct and go it alone or take the bold decision to recall parliament during the Easter recess in order to obtain parliamentary approval?

While she is deliberating her next steps, news that commercial passenger jets have been warned to avoid the Eastern Mediterranean area appears only to increase the likelihood that a US-led air strike is imminent. Indeed, Donald Trump has cancelled a planned trip to Latin America, signaling that the White House have made their response to the situation a top priority.
 
Emmanuel Macron also supports a retaliation attack but suggested that any strike should only target "the regime's chemical capabilities".
 
The idea that it is a matter of when, rather than if the US press the button on military intervention is likely to make their allies particularly nervous. This is primarily because of the acute dangers that any attack could accidentally strike one of the Russian or Iranian forces based in Syria, leading to equally painful consequences. Moscow last night vetoed a UN security council resolution ordering a full investigation into the Douma attack, earning support only from Bolivia, while China abstained.
 
With Trump unlikely to remain patient for much longer, I suspect May knows that the time for talking is fast coming to an end.

News

Mark Zuckerberg has spent more than five hours defending Facebook to US congress. The CEO of the social media giant apologised for the scandal in which millions of users had personal information taken and agreed to tighter regulation of the company. (£)
 
Barry Gardiner, Labour’s shadow trade secretary, was under pressure last night after he was recorded at an event in Brussels dismissing one of the party’s key Brexit policies and claiming that the Good Friday Agreement was obsolete. Leader Jeremy Corbyn has backed Gardiner, saying that “it’s quite clear he does support our strategy of holding the government to account on the tests”. (£)
 
Five Cameroonian athletes competing at the Commonwealth Games in Australia have gone missing from the athletes' village. The athletes - three weightlifters and two boxers – were reported missing to Australian police.

 

Business & Economy

Tesco has announced a 28.4% rise in group operating profit, as CEO Dave Lewis remarked on "another strong year of progress". The retailer saw group sales Group rise 2.3% to £51bn, marking the ninth consecutive quarter of sales.

A new report by the CBI has warned that large swaths of the economy will be damaged if the UK deviates too far from EU regulations after Brexit. Carolyn Fairbairn, the head of the CBI, said that the majority of sectors want to remain close to current rules as the opportunity for future regulatory freedom from Brussels were “limited”.

New research has shown that new stores are opening on UK High Streets at their lowest rate in seven years. A report by the Local Data Company found there were 4,083 new store openings in 2017, the lowest since 2010. However, with 5,855 outlets closing in 2017, a total of 1,772 shops disappeared, with clothing and shoe shops closing at the fastest rate.

What happened yesterday?

The FTSE 100 index closed higher yesterday as investor fears of a trade war between the US and China begin to fade. At close of trading, the blue chip stock index was nearly 1% higher at 7262 points. This followed the news that Chinese President Xi Jinping pledged a ‘new phase of opening up’, an indication that he was prepared to cut import tariffs.
 
Mining companies among the big winners on the day. Anglo American, Antofagasta, BHP Billiton and Rio Tinto were all in the top five highest performing stocks.
 
A similar bounce was found in the European stocks, with the pan-European Stoxx 600 up 0.7%, Frankfurt’s Xetra Dax up 1.1% and Paris’s CAC 40 up 0.6%. On Wall Street, the S&P 500 was up 1.3% and the Dow gaining 1.6% in early trading.
 
It was also a good showing for the pound, which was 0.3% up to $1.4174. Oil prices continued to climb, with Brent crude reaching a two-week high of $69.95 a barrel. It had at one point in the day breached the $70 mark.

 

Finals
Epwin Group
Ergomed
Shield Therapeutics
Tesco

Interims
ASOS
McCarthy & Stone

GMs
Carnival
Heavitree Brewery
Law Debenture Corp.
Maven Income & Growth 3 VCT
Rio Tinto
 
UK Economic Announcements
(09:30) Balance of Trade
(09:30) Industrial Production
(09:30) Manufacturing Production
 
Intl. Economic Announcements
(12:00) MBA Mortgage Applications (US)
(13:30) Consumer Price Index (US)
(15:30) Crude Oil Inventories (US)

 

Columns of Note

Anne McElvoy, a senior editor at The Economist, suggests in The Evening Standard that the election of Viktor Orban to a third term as Hungarian prime minister demonstrates that centrists must show more imagination when responding to his brand of populist politics. McElvoy says that the drive and energy of populists, as well as their ability to drape themselves in the national interest, could be copied by defenders of the centre ground, who must also “figure out how they can deal with the desire for clearer identity inside national or regional borders without lapsing into petty chauvinisms.”
 
In The Times, Alice Thomson says that distance learning for mature students who want to retrain will be invaluable if careers are to be extended into old age. Thomson argues that the Open University must play a pivotal role in this and says the government must step up and support it to ensure Britain develops a flexible, highly educated workforce after Brexit. (£)

Did you know?

The City of London pays rent to the Queen for two pieces of land, even though it no longer knows their exact locations. The Ceremony of Quit Rents is the oldest legal ceremony in England, apart from the Coronation, and takes place between St Michael’s Day (October 11) and St Martin’s (November 11) every year.

Parliamentary highlights

House of Commons
 
In recess until 16 April 2018
 
House of Lords
 
In recess until 16 April 2018

Scottish Parliament

In recess until 16 April 2018