19 October

Ania Lewandowska

19 October

Good morning,

A day ahead of the European Union summit in Brussels, the new European Council ‘space egg’ building was evacuated for the second time in less than a week yesterday. An unfortunate matter of toxic gases emanating from the Europa building kitchens has prompted a last-minute move to the previous venue; happily, the evacuations were not caused by more sinister reasons – just unfortunate material for EU critics and wags.

The 28 leaders will meet at the nearby Justus Lipsius building instead, with Brexit, Turkey and Iran high on the summit’s agenda. Although Brexit is the hot-button topic in the UK, not least following Theresa May’s Facebook post reassuring EU citizens, the matter of EU’s bilateral relations with Turkey is also a concern for leaders on the continent. Dealings between the bloc and Turkey have turned frosty over the last few months and could worsen.

Concerns over the state of democracy in the country, with media outlets being closed and journalists jailed, continue. Meanwhile in Turkey, Europe is viewed as a hypocrite, misleading Ankara about potential membership; complaining about the country’s human rights record but transacting to keep refugees out. Few there believe that the EU will ever let Turkey become a member, especially following German Chancellor Angela Merkel’s comments last month stating Turkey "should not become a member of the EU".

While Merkel may be keen to convince fellow member states to suspend membership talks with Turkey, it is unlikely that there will be any decisions taken during the summit.

Likewise, Theresa May’s pitch to break the deadlock in Brexit talks is not expected to bring resolution, with discussion among the other leaders on Britain’s future trading position to happen only after May leaves on Friday.

News

Catalonia's leader Carles Puigdemont is facing a final deadline to drop a secession bid, with Spain warning it will suspend the region's autonomy if he fails to do so by 10:00 (08:00 GMT). Prime Minister Mariano Rajoy’s government says it will trigger Article 155 of Spain's constitution - a measure that would allow it to start imposing direct rule over semi-autonomous Catalonia - unless Puigdemont backs down.

US President Donald Trump was involved in fresh controversy yesterday after being accused of being disrespectful to a US soldier killed in an ambush in Niger, and showing insensitivity to the grieving family. Trump moved quickly to dispute descriptions of his conversation with the pregnant widow of Sergeant La David Johnson, who was one of four US service members killed in a jihadist ambush earlier this month. Two accounts of his call suggest the president struggled to convey an empathetic tone.

England striker Eni Aluko accused Football Association (FA) chief executive Martin Glenn of “blackmail” as she gave evidence to a parliamentary inquiry into allegations of racism yesterday. Aluko made the allegation to the Digital, Culture, Media and Sport select committee after sacked England Women manager Mark Sampson was found guilty of racially abusing her and team-mate Drew Spence.

Business & Economy

Chancellor Philip Hammond has asked UK enforcement agencies to look into whether British banking groups HSBC and Standard Chartered are linked to South Africa’s corruption inquiry into alleged ties between the wealthy Gupta family and President Jacob Zuma. The move follows a letter from Lord Peter Hain, who said a South African whistle-blower had indicated the banks "maybe inadvertently have been conduits for the corrupt proceeds of money".

Shareholders in Lloyds Banking Group were “mugged” by the bank during the takeover of HBOS in 2008, the high court has heard. Almost 6,000 shareholders are suing the lender for up to £700m over the deal at the height of the financial crisis. They claim bosses failed to consider the dangers of the takeover and misled investors.

Researchers on behalf of the Social Mobility Commission tracked individuals’ pay over ten years and found low pay is “endemic” in the UK, with little progress in the number of people managing to escape from poorly paid jobs. Only one in six workers on low pay in the last 10 years managed to climb the pay ladder and stay there, while most remained stuck in a cycle of part-time and insecure jobs.

Markets

What happened yesterday?
The FTSE 100 closed up 26.70 at 7,542.87.

Education and publishing group Pearson led the risers, up 3% at 687p, while pharmaceutical group Shire was the biggest faller, down 3.11% to £37.19.

Rio Tinto also dropped in value yesterday, when its share price fell 2.98% to £35.99 after it emerged that the mining giant and two of its former senior executives have been charged with fraud in the US.

Shares in consumer product giant Reckitt Benckiser also fell, down 2.53% to $68.57 after it cut its full-year revenue growth forecasts for a second time this year.

Oil prices have retreated following higher than expected inventories of crude in the US.
Brent crude has fallen back to its opening price of $57.89 after rising earlier yesterday.

The FTSE 250 closed up 128.82 at 20,259.77.

On the currency markets, sterling continued its fall against the dollar, which began on Tuesday after the Bank of England's new deputy governor indicated he was not in favour of raising rates.

By the end of Wednesday the pound regained some ground to trade flat against the dollar at $1.31910. Against the euro, however, it was down 0.2% at €1.11890.

Finals
Tristel Plc (TSTL)

Interims
Stobart Group Ltd (STOB)

AGMs
BHP Billiton plc (BLT)
Pci-Pal plc (PCIP)
Rank Group (RNK)

UK Economic Announcements
(9:30) Retail Sales

Trading Announcements
Travis Perkins plc (TPK)

International Economic Announcements
(13:30) Continuing Claims (US)
(13:30) Initial Jobless Claims (US)
(13:30) Philadelphia Fed Index (US)

Columns of Note

Writing in The Times this morning, David Aaronovitch examines the pros and cons of direct democracy. The author finds that while referendums are growing in popularity across Europe and beyond, we might want to try online plebiscites which would let us participate immediately in any policy decision, although that option also has some unwanted consequences.

In The Guardian, Emma Sky, who served in Iraq as the political advisor to US General Ray Odierno, discusses the difficult situation in Kirkur, where thousands of Kurds are forced to flee the city in the face of the advance of the Iraqi army.

Did you know?

A storm is officially a wind of force 10 on the Beaufort scale (55-63mph). If the wind reaches 64-73mph, it becomes a violent storm. Beyond that it is a hurricane.

Parliamentary highlights

TODAY

House of Commons

Oral questions - Transport (including Topical Questions)

Business Statement - Business Questions - Andrea Leadsom
General Debate - Tobacco control plan - subject nominated by the Backbench Business Committee - Sir Kevin Barron
Valproate and fetal anticonvulsant syndrome - subject nominated by the Backbench Business Committee - Norman Lamb

House of Lords

Oral questions

Preventing money laundering through British banks by families and businesspeople linked to the government of South Africa - Lord Hain
Fuel poverty - Baroness Donaghy
Moderate opposition groups in Syria and political support - Lord Green of Deddington

Short Debate - Assessment of the impact on the economy of failure to agree a transition deal with the European Union - Baroness McIntosh of Pickering

Scottish Parliament

In recess until 23rd October

TOMORROW

House of Commons

The House is expected to consider Private Members' Bills (Standing Order No. 14(8))

Legislation

Assaults on Emergency Workers (Offences) Bill - 2nd reading - Chris Bryant
Parental Bereavement (Leave and Pay) Bill - 2nd reading - Kevin Hollinrake
Public Sector Exit Payments (Limitation) Bill - 2nd reading - Mr Christopher Chope
Electronic Cigarettes (Regulation) Bill - 2nd reading - Mr Christopher Chope
Student Loans (Debt Discharge) Bill - 2nd reading - Mr Christopher Chope

House of Lords

No business scheduled