18 December

@lyle_h_hill

18 December

Good morning,

Theresa May will meet her 'Brexit Cabinet' today in order to kick start discussions on what any future relationship with the EU should look like. The Brexit Cabinet is made up of 12 of the prime minister's most trusted and senior ministers, but includes voices from both the eurosceptic and the pro-EU wings of her government.

As has so often been the case during these negotiations, The Telegraph is reporting this morning that Mrs May has her work cut out reconciling the two factions in her government, following Michel Barnier's announcement yesterday that there was "no way" Britain could "cherry pick to accommodate their wishes" on any future trading arrangements.

Eurosceptics such as Boris Johnson, Michael Gove and their allies, have used these remarks as evidence that the UK should be cutting all regulatory ties and dealigning from the EU, allowing Liam Fox to sign trade deals around the world.

However, this position will cause fierce debate amongst Amber Rudd and Philip Hammond, who are vocal pro-EU voices in the Cabinet. Once again, Theresa May will be stuck in the middle, trying to broker a deal and a compromise position between the two sides.

Over the weekend, the prime minister was in a bullish mood, taking personal credit for the deal struck last week allowing the UK and the EU to move on to the next phase of talks. The EU has since published its guidelines for phase two of the negotiations, with discussions on long-term future economic co-operation not pencilled in until March.

Labour has responded by arguing that waiting until March to begin such important discussions would cause a "real problem" for business.

As we enter the final week before Christmas, it looks like the year will end in the same manner it has been conducted, with Brexit dominating our headlines.

News

Rebecca Dykes, a UK diplomat in Lebanon, has been found dead. Authorities fear she has been murdered after her body was found by the roadside on the outskirts of Beirut. The young diplomat was seconded to the UK embassy in Beirut from the Department for International Development.

A power cut at Hartsfield-Jackson international airport in Atlanta has left tens of thousands of travellers stranded. The airport is calculated to be the world's busiest, with 250,000 travellers passing through each year. Over a thousand flights were cancelled from the airport on Sunday, with hundreds more expected to be cancelled today.

Mo Farah was the winner of BBC Sport Personality of the Year last night, edging out Anthony Joshua and Lewis Hamilton to the title. Farah's win was unexpected, with some bookmakers placing his odds as long as 50/1. Joshua finished fourth and previous winner Lewis Hamilton finished sixth.

Business & Economy

Facebook has admitted that passive use of social media can be bad for user's mental health. Studies have long shown that intense social media use can lead to depression and low self-esteem, especially amongst the young. Facebook's advice to users was to actively post and engage with the social media site rather than view “from the sidelines”.

The Department for Work and Pensions has admitted 12 million Brits are under-saving for retirement, raising fears of a lost pension generation. The groups most as risk of losing out are millennials and gig economy workers. The government said from the mid-2020s, over 900,000 people will be drawn into workplace pensions as employers were forced to auto-enrol workers aged between 18-21.

Analysts in the United States expect corporate earnings to be boosted by an average of 10%, and in some cases by as much as 30%, if Republicans can pass the tax bill in Congress this week. The biggest winners are expected to be oil refiners, railroads, airlines and banks, which have relatively high tax rates and book mainly US based revenues.

Markets

The week ahead
The main news this week looks set to come out of America, as Senators Bob Corker and Marco Rubio have turned their votes from no to yes on the new tax bill. These switches mean that Trump's tax measure is almost certain to pass later this week.

The bill has been hugely controversial in the United States, with many progressives arguing that the bill merely cuts taxes for the very wealthiest and big corporations, rather than average American workers.

Corporate America has been waiting for this policy for a while now, and much of the 'Trump bounce' on the stock market has been in anticipation of deregulation and tax cuts for American businesses.

Therefore, if the bill does pass, there may be another rally in US markets as traders react to the prospect of American firms making up to 30% more in earnings.

Interims
Goodwin Plc

Trading Announcements
Berendsen

AGMs
Leaf Clean Energy Co
Minds + Machines Group Limited
Mosman Oil and Gas Limited
Proactis Holdings

International Economic Announcements
(10:00) Consumer Price Index (EU)

UK Economic Announcements
(11:00) CBI Industrial Trends Surveys

Columns of Note

Juliet Samuel, writing in The Telegraph, argues that Blue Planet's huge success is down to our need for wonder in a modern, sterile world. She believes Blue Planet did not delude its viewers, but instead inspired them.

Rana Faroohar, writing in the Financial Times, outlines why big tech wants to keep the net neutral. Faroohar argues that net neutrality has helped the likes of Amazon, Facebook and Google, and that new rules will have to be created in order to continue competition following the abandonment of net neutrality laws.


Did you know?

The term "net neutrality" was first deployed 15 years ago, and is commonly used to refer to the idea that all internet traffic should be treated equally.
Parliamentary highlights

TODAY

House of Commons
Oral questions
Work and Pensions (including Topical Questions)

Legislation
Finance (No.2) Bill - Committee Stage (Day 1) - Committee of the whole House

Adjournment
RBS branch closures in rural areas - Ian Blackford

House of Lords
Oral questions
Enforcing minimum wage legislation to end the practice of unpaid internships - Lord Holmes of Richmond
Disaster and Emergencies Preparedness Programme - Baroness Sheehan
Testing new approaches to mental health assessments for looked-after children - Baroness Tyler of Enfield
Improving surveillance of the UK’s borders - Lord Wallace of Saltaire

Debate
Report from the Select Committee on Financial Exclusion - Baroness Tyler of Enfield
Report from the EU Committee Brexit 'trade in non-financial services' -Lord Whitty

Scottish Parliament
No business scheduled.

TOMORROW

House of Commons
Oral questions
Health (including Topical Questions)

Legislation
Finance (No.2) Bill - Committee Stage (Day 2) - Committee of the whole House

House of Lords
Debate
Report of the Lord Speaker’s committee on the size of the House - Lord Burns

Oral questions
Reviewing Government policy on capping domestic energy prices - Lord Naseby

Supporting women to use the legal system to challenge sexual harassment in the workplace - Baroness Kennedy of The Shaws

Scottish Parliament
Ministerial Statement
Programme to reach 100% access to superfast broadband in Scotland

Stage 1 Debate
Social Security (Scotland) Bill