Yesterday, the new French government stepped up its efforts to attract bankers and financial institutions to make the move from London to Paris. The Prime Minister Edouard Philippe said: "We want Paris to become Europe's new number one financial hub after Brexit.”
Addressing the audience of financial executives in English at the Paris Europlace International Financial Forum, Philippe pledged to reduce the cost of employing financial services staff and committed to keeping the regulatory burden on finance companies competitive.
At the same event, JPMorgan Chase & Co Chief Executive Jamie Dimon warned that US banks would have to uproot their London-based staff if ordered to do so by the EU. Around 16,000 staff are employed today by JP Morgan in the UK and approximately 75% of the business they conduct is for EU companies. Dimon said plans are already underway to move hundreds of jobs to the continent.
Earlier this month, France, now led by former banker Emmanuel Macron, committed to lowering the corporate tax rate (from 33.3% to 25%) by 2022, to getting rid of a 0.3% levy on financial transactions, to scrapping the €150,000 tax bracket and to excluding bonuses from the calculations of redundancy pay for stockbrokers. Commentators agree that these measures would have been unthinkable under the previous government.
And it's not just tax breaks that the French are preparing to entice bankers and their families; three new international schools are set to open over the next five years in and around Paris to accommodate expat children.
It's too early to tell if these measures will create a widespread exodus from the City but Paris is pulling out all the stops to create an attractive alternative.
Donald Trump Jr defended himself last night after being attacked by Democrats and Republicans for agreeing to meet with Natalia Veselnitskaya, a "Russian government lawyer", in an attempt to get "dirt" on Hillary Clinton during the US presidential election. Trump Jr released a series of emails and admitted that he could have handled the situation better but he had not told his father about meeting Veselnitskaya because “it was a nothing”.
The Prime Minister Theresa May has ordered an inquiry to establish how contaminated blood transfusions infected thousands of people with hepatitis C and HIV. The scandal that left 2,400 people dead took place in the 1970s and 80s, when patients were given infected blood products from abroad. Details of the UK-wide investigation have yet to be finalised, and consultations will take place with those people affected as to how best to proceed. The move came just hours before May faced possible defeat in a Commons vote on an emergency motion concerning the contaminated blood scandal.
According to a Lords committee report, a Royal Navy and EU mission to combat people-smuggling in the Mediterranean has caused more migrants to die at sea. The peers concluded that Operation Sophia, the European Union mission to break up smuggling networks, which cost £6 million in the past year, was a failure and urged against the renewal of its mandate this month. The initiative undertaken by 25 EU member states, including the UK, was launched in 2015 in the wake of disasters in which hundreds of migrants drowned attempting to reach Europe and has saved 33,830 migrants.
Johanna Konta has become the first British woman to reach a Wimbledon semi-final since 1978 after coming back from the brink to win an epic three-set match on Centre Court. The Australian-born tennis star saw off Romanian world No 2 Simona Halep to match the efforts of Virginia Wade 39 years ago.
BUSINESS AND ECONOMY
Lloyds Banking Group – the UK’s biggest provider of current accounts – is embarking on a radical overhaul of its overdraft charges. As of November 2017, overdrafts on current accounts from Lloyds Bank, Bank of Scotland and Halifax will be charged at 1p a day for every £7 the account is overdrawn – whether you have pre-arranged an overdraft facility or not. 20 million customers of Lloyds Banking Group are set to benefit from the measures, which follow criticism of high charges by consumer groups and the Competition and Markets Authority (CMA).
TripAdvisor has partnered with Deliveroo to incorporate the delivery firm's food ordering service into the travel site's listings across 12 countries. The scheme will connect more than 20,000 restaurants with customers able to access Deliveroo by clicking "order online" within TripAdvisor in the United Kingdom, Ireland, France, Germany, Spain, Italy, Belgium, the Netherlands, United Arab Emirates, Singapore, Hong Kong and Australia. Terms of the partnership were not disclosed.
What happened yesterday
FTSE 100 closed over 40 points down, with retailers taking a hit and the pound weakening. The blue chip index was down 0.6 per cent at 7,329.76 points at its close.
Shares in Pearson slid 5.1%, but they had been up roughly 3% in early trade after the education and publishing company said it’s selling its 22% stake in Penguin Random House for $1 billion (£776m) to German media company Bertelsmann SE, its joint-venture partner. The stock was the FTSE 100’s biggest loser.
Elsewhere in the market, shares in Marks and Spencer fell 4.7% after the retailer reported a further drop in sales.
Heavily-weighted mining stocks were among the top performers as copper prices rose and amid speculation that China may start to raise liquidity.
The FTSE 250 plunged 142 points lower to 19,215.
Fulham Shore plc (FUL), Micro Focus International plc (MCRO)
Altitude Group Plc (ALT)
Biotech Growth Trust (The) (BIOG)
BT Group plc (BT.A)
Global Fixed Income Realisation Ltd (GFIR)
Magnolia Petroleum plc (MAGP)
MyCelx Technologies Corp (MYX)
NEX Group Plc (NXG)
Northern 2 VCT plc (NTV)
Speedy Hire plc (SDY)
Barratt Developments plc (BDEV)
Burberry Group plc (BRBY)
Eve Sleep plc (EVE)
J D Wetherspoon plc (JDW)
NEX Group Plc (NXG)
Robert Walters plc (RWA)
UK Economic Announcements
(9:30) Claimant Count Rate
Int. Economic Announcements
(11:00) Industrial Production (EU)
(12:00) MBA Mortgage Applications (US)
(15:30) Crude Oil Inventories (US)
COLUMNS OF NOTE
Writing in The New Yorker, John Cassidy analyses the stunning disclosure of Donald Trump Jr.’s emails about his meeting with Natalia Veselnitskaya, a well-connected Russian lawyer. Cassidy suspects that the White House and the President are not only looking to distance themselves from this “fine young fellow” but appeared content to let him be the fall man for the whole incident.
Roger Boyes, the Berlin correspondent for The Times criticises Angela Merkel’s “welcome culture” and open doors policies and instead looks at reasons why Viktor Orban’s approach strikes a chord with many ordinary Hungarians.
DID YOU KNOW?
Wiz Khalifa performing "See You Again" with over 2.89 billion plays is now the most-viewed YouTube video of all time. http://bit.ly/1aEIcVa
House of Commons
Prime Minister's Question Time
The Grenfell Tower Fire Inquiry
House of Lords
Proposals the Leader of the House has to create a close and constructive relationship between the House of Lords and the European Parliament
Risks to NHS sustainability arising from the United Kingdom's departure from the European Union - Lord Warner
In recess until 3rd September.
House of Commons
Transport (including Topical Questions)
Business questions - Andrea Leadsom
The Commemoration of Passchendaele, the third battle of Ypres
Prosecution of driving offences committed on private land - Alec Shelbrooke
House of Lords
Changes to the application of the Barnett formula to Wales and Scotland arising from additional financial provision for Northern Ireland - Lord Wigley
Reviewing the Pension Protection Fund and the powers of the pension regulator - Lord McKenzie of Luton
Focusing on the root causes of poverty and disadvantage - Lord Bird
Impact of deregulation on public services, health and safety - Baroness Andrews
Cap on public sector pay - Lord Haskel
Security challenges and related human rights violations on the Korean Peninsula - Lord Alton of Liverpool