16 March 2018

Lye Hill

16 March 2018

Good morning,

Just when everyone thought it might be wise for Jeremy Corbyn to keep quiet for a while following the discontent caused by his comments in response to the Russian nerve agent attack, he decides to pen an article for The Guardian doubling down on his position and warning against "McCarthyite intolerance of dissent".

Some may see this as slightly hypocritical, considering the continued internal Labour Party machinations and Corbyn's attempt to win complete control of the inner workings of the party.

But this latest defiance of his critics within his own party and across the House will raise even more eyebrows. Corbyn used the article to warn the prime minister against "rushing ahead" of the evidence and pushing the UK towards a "new cold war".

Despite this intervention, it appears the international community is rallying behind the prime minister.

After an initial lukewarm French response to the attack, Emmanuel Macron has given his pen to an unusual joint statement issued by the leaders of the United States, United Kingdom, Germany and France to condemn the actions of Russia, highlighting the fact that there was “no plausible alternative explanation” to Russian involvement. 

Meanwhile, Vladimir Putin is out campaigning hard in Russia's free and fair elections, due to take place on Sunday. We await the result with bated breath.

How he responds to this new solidarity in the West will be the first act of his new presidency, supposed to be his last under the Russian constitution.

Whether he resigns from office in 2024 remains to be seen, but the Financial Times Big Read, in our Columns of Note section yesterday, gives a good insight into the men Putin is promoting inside his government.


A pedestrian bridge in Miami collapsed yesterday onto a busy highway, killing at least four people. Rescue attempts continue as nine other people have been taken to hospital, including two in "extremely critical condition". The "instant bridge" was only erected in a matter of hours on Saturday, using a new modular construction method.

Reports from the United States suggest this morning that Donald Trump is preparing to fire General McMaster, his national security adviser, as high level staff changes continue in the administration. It is widely known that the working relationship between the two men is poor, despite White House attempts to downplay the issue.

The North Korean foreign minister has arrived in Sweden on a surprise visit, raising speculation that the upcoming talks between Donald Trump and Kim Jong-Un may be mediated by the nation. Swedish Prime Minister Stefan Lofven said in an interview on the country's news agency that "if the main actors want Sweden to play a role then we are ready to do that".


Business & Economy

The Financial Reporting Council, that regulates accountants, has called on the Competition and Markets Authority to launch an inquiry into the big four accountancy firms. The proposal is designed to investigate whether the largest accountancy firms should be broken up to create "audit only" firms in order to improve transparency and accuracy in the auditing of large public companies.

Rolls-Royce became the latest company yesterday to enter the bitter hostile takeover battle between engineering group GKN and Melrose Industries. Rolls-Royce admitted it had "no objections" to the proposed takeover and added that there was “no reason to believe our relationship would change in the event of a change of ownership”. This intervention comes a day after Airbus said it had serious concerns over the short term strategy of Melrose.

HSBC has admitted that in the UK it has a 60% pay gap between men and women. The large pay gap reflects the fact that more men are employed in senior roles. The company said it would do more to ensure women were given opportunities for promotion and that it would request the presence of at least one woman candidate for external hires. The national median pay gap in the UK is 18.4%.



What happened yesterday?
The FTSE100 gained 7 points yesterday to close at 7,139.76. The rise of 0.1% was driven by a climb in Standard Life Aberdeen stock after the company announced it was setting aside £35 million for investment research. It closed up 1.8% to 372.6p.

This rise follows a dramatic drop in the firm's shares a month ago, after it was announced that Lloyds Banking Group and Scottish Widows would be ending a £100 billion asset management contract with Standard Life Aberdeen.

Tesco also rose on the day, climbing 1.76% after JP Morgan Cazenove turned positive on the stock for the first time in five years.

It argued Tesco would gain from easier access to the £30 billion UK wholesale food market due to its acquisition of Booker, and that hiring Booker CEO Charles Wilson would help with any possible integration problems.

It was a less impressive day for real estate investment trust Hammerson. The company slipped almost 5% following a downgrade from Credit Suisse.

Credit Suisse cited an overpriced proposed merger with Intu, which would create a £21 billion portfolio of retail developments across Europe, and a stagnating UK real estate and retail market as reasons for the downgrade.

On the currency markets, the pound was down 0.04% against the dollar at $1.39590, but rose 0.24% against the euro to €1.13250.

Capital Drilling Ltd
Wetherspoon (J.D.)

Trading Announcements
Berkeley Group Holdings (The)
Mitie Group


LG Electronics Inc GDS
Spitfire Oil Ltd
International Economic Announcements
(07:00) Wholesale Price Index (GER)
(10:00) Consumer Price Index (EU)
(12:30) Building Permits (US)
(12:30) Housing Starts (US)
(13:15) Capacity Utilisation (US)
(13:15) Industrial Production (US)
(14:00) U. of Michigan Confidence (Prelim) (US)

Columns of Note

Writing in The Guardian today, Jeremy Corbyn outlines his position on the Salisbury attack and urges the prime minister to think with calm and restraint before "rushing ahead" of the evidence.

Ed Conway, writing in The Times, argues that despite some gloomy forecasts outlined by the chancellor on Tuesday, an upturn in growth could come faster than we think, driven primarily by our services sector.

Did you know?

Using magic to find money or treasure was punishable under the 1563 and 1604 English Witchcraft Acts by imprisonment for a year and four stints in the pillory for a first offence.

A second treasure hunting offence brought imprisonment for life under Elizabeth I, but under James I, it meant death.


Parliamentary highlights

House of Commons
Refugees (Family Reunion) (No. 2) Bill - 2nd reading - Angus Brendan MacNeil
Unpaid Trial Work Periods (Prohibition) Bill - 2nd reading - Stewart Malcolm McDonald
BBC License Fee (Civil Penalty) Bill - 2nd reading - Sir Christopher Chope
Electronic Cigarettes (Regulation) Bill - 2nd reading - Sir Christopher Chope
Affordable Home Ownership Bill - 2nd reading - Sir Christopher Chope
Hospital Car Parking Charges (Abolition) Bill - 2nd reading - Robert Halfon
Universal Credit (Application, Advice and Assistance) Bill - 2nd reading - Dr Philippa Whitford
Emergency Response Drivers (Protections) Bill - 2nd reading - Sir Henry Bellingham
British Indian Ocean Territory (Citizenship) Bill - 2nd reading - Henry Smith
Domestic Properties (Minimum Energy Performance) Bill - 2nd reading - Sir David Amess
Clean Air Bill - 2nd reading - Geraint Davies
Terms of Withdrawal from EU (Referendum) Bill - 2nd reading - Geraint Davies
Wild Animals in Circuses Bill - 2nd reading - Trudy Harrison
House of Lords
No business scheduled
Scottish Parliament
No business scheduled