16 May 2018

@Lyle_h_hill

16 May 2018

Good morning,

The game of chess between North Korea, South Korea and the United States has taken another twist as we head towards the historic summit due to take place in Singapore in June.

This morning, the North Korean leadership is threatening to pull out of the meeting with President Trump on June 12th, citing intense pressure to give up its nuclear weapons unilaterally rather than a full disarmament of the peninsula.

In a statement, North Korea's vice-foreign minister Kim Kye-gwan laid the blame squarely with the hawkish John Bolton, Trump's newly appointed National Security Adviser who urged him to ditch the Iran nuclear deal last week.

The statement did not hold back, claiming that North Korea "does not hide our feeling of repugnance towards him". With such an historic summit on the line and no particular aversion to staff turnover in the White House, such a clear statement of distaste towards a Trump staffer could spell the end for Bolton.

Closer to home in the UK, while North Korea was accusing America and South Korea of hubris, MPs on the Business, Energy and Industrial Strategy and Work and Pension committees were accusing Carillion bosses of the same thing.

The eagerly anticipated 100 page report released jointly by the committees has claimed that the collapse of the outsourcer highlighted "systematic flaws" in the way corporate Britain operates, and has called for a substantial shake-up.

The main recommendation would see the Big Four accountancy firms, EY, PwC, KPMG and Deloitte referred to the competition watchdog in order to investigate their stranglehold over auditing in the UK, with a view to a potential break-up. 

NEWS

Anwar Ibrahim, Malaysia's former deputy prime minister who was jailed for sodomy four years ago, has been released from prison. The move represents the first significant steps of the new governing coalition led by Mahathir Mohamad, who won a shock election victory last week.

New research, studying data on 91,000 people, has found that mobile phones should not be used beyond 10pm in the evening. The study showed the using phones later at night disrupted sleep patterns and can lead to issues such as depression and bipolar disorder.

David Davis has warned prime minister Theresa May that her preferred option of a 'customs partnership' with the EU following Brexit could be illegal under international law. The attorney-general has been asked to provide an urgent legal opinion before the Cabinet makes its final choice on the proposals.

BUSINESS AND ECONOMY

Business leaders have warned that another set of lacklustre productivity figures released yesterday should act as a wake up call to Britain. Amid slow economic growth figures released last week, the Office for National Statistics showed output per hour worked fell by 0.5 per cent during the first quarter of 2018.

An investigation by the National Audit Office has found that the push for green energy costs consumers and businesses £100m a year in higher bills. The NAO claimed that the Department for Business, Energy and Industrial Strategy last year favoured smaller, more expensive projects rather than larger bids that would have reduced the cost of energy per unit.

Nick Read, the newly unveiled chief executive of Vodafone, who will officially take over from Vittorio Colao in October, has called for calm after the shock announcement of Colao's departure sent shares tumbling despite impressive results. Shares in the group fell 4.3 per cent yesterday making it the biggest faller on the FTSE 100.

MARKETS

What happened yesterday?
The FTSE 100 finished up 12.00 or 0.16% at 7,722.98 yesterday, as sterling slumped following gains on Monday.

Sterling was down 0.3% against the dollar at $1.3514 but made a late 0.2% gain on the euro to €1.1389. The dollar was strong on the back of US retails sales data which posed a marked difference to the same figures released by the UK at the start of the week. 

In the UK, the Office for National Statistics released wage data yesterday, showing average weekly wage growth slowed to 2.6% in March from 2.8% in February, but that employment expanded at the best quarterly rate for more than two years.

Easyjet had a strong day on the markets after announcing that revenue had risen to over £2 billion for the first time on the back of the downfall of rivals Monarch and Air Berlin.

Vodafone slipped after announcing that Vittorio Colao would step down as chief executive after a decade at the helm. However, the mobile operator also reported a 40% rise in full-year pre-tax profit to €3.9bn.

Finals
Burberry Group
C&C Group
Speedy Hire

Interims
Brewin Dolphin Holdings
Mitchell's & Butlers
Marston's
SSP Group

AGMs
Cineworld Group
Jupiter Fund Management
Moss Bros Group

Int. Economic Announcements
(09:00) Consumer Price Index (GER)
(10:00) Consumer Price Index (EU)
(12:00) MBA Mortgage Applications (US)
(13:30) Building Permits (US)
(13:30) Housing Starts (US)
(14:15) Capacity Utilisation (US)
(14:15) Industrial Production (US)

COLUMNS OF NOTE

Philip Johnston, writing in The Telegraph, argues that instead of consistently arguing for a new party to emerge, instead opponents of Brexit should be calling for a prime minister who is willing to work constructively with Remainers rather than being beholden to her own party struggles.

Roger Boyes, writing in The Times, brings the attention back to Russia as the world has looked elsewhere to other diplomatic rows. He says that the West's stance against Putin is crumbling as attention is being drawn to other more pressing issues.

DID YOU KNOW?

The "Big Four" accountancy firms currently audit over 340 members of the FTSE 350.

PARLIAMENTARY HIGHLIGHTS

TODAY

House of Commons

Oral Questions
Chancellor of the Duchy of Lancaster and Minister for the Cabinet Office

Prime Minister's Questions

Opposition Day Debate

Grenfell Tower
Brexit

House of Lords
Oral Questions
Assisting financially with the historic back pay liability of providers of commissioned care for people with learning difficulties - Baroness Richardson of Calow

Introducing a national autism and education strategy - Lord Touhig

Advice to British companies about the possible impact on their trade with the US after imposition of US sanctions on Iran 
Lord Dubs

Legislation
European Union (Withdrawal) Bill - Third reading - Lord Callanan

Scottish Parliament
Portfolio Questions
Communities, Social Security and Equalities

Culture, Tourism, Europe and External Relations Committee Debate
Erasmus+


TOMORROW

House of Commons

Oral Questions
International Trade (including Topical Questions)
Women and Equalities (including Topical Questions)

Business Statement
Business Questions to the Leader of the House - Andrea Leadsom

Select Committee Statement
Ninth Report of the Business, Energy and Industrial Strategy Committee, The impact of Brexit on the pharmaceutical sector, HC 382

Backbench Business
Plastic bottles and coffee cups - Mary Creagh

House of Lords
Oral Questions
Steps the Department of Health and Social Care and the NHS are taking to support the mental health of the NHS workforce in England - Baroness Thornton
Implementing pardons and disregards for homosexual activities which are no longer crimes - Lord Cashman
Proposals for future framework for UK--EU Security Partnership - Lord Wallace of Saltaire
The opening of the US embassy in Jerusalem and loss of Palestinian lives in Gaza - Baroness Warsi

Legislation
Automated and Electric Vehicles Bill - Committee stage (day 2) - Baroness Sugg

Scottish Parliament
First Minister's Questions

Members' Business

The Everyone’s Business Campaign

Ministerial Statement
Scottish Veterans Commissioner's report on Veterans Health and Wellbeing