20 July

@cstreetpartners

20 July

Good morning,

If you happen to have been born between Simon & Garfunkel scoring a number one hit with Bridge Over Troubled Water and Kate Bush’s Wuthering Heights achieving the same lofty heights, you will have to wait until you are 68 to claim your state pension.
 
And, as if it’s any consolation, you are not alone. Around seven million people between the ages of 39 and 47 will be affected by the change announced by the secretary of state for work and pensions, David Gauke, in the House of Commons yesterday.
 
The state pension age had been due to rise by a year – from the current age of 67 – in 2044, but the UK government has decided to accept the recommendations of the Cridland report and implement the cash-saving measure seven years earlier than planned.
 
Gauke said the move, designed to save £74 billion by 2045/46, is the government’s response to “demographic pressure”. However, the new timetable was greeted with dismay by unions and described by Debbie Abrahams, shadow work and pensions secretary, as “an astonishing continuation of austerity”. 
 
The proposed changes to state pensions are unlikely to worry any of the BBC’s top presenters, whose salaries were published by the corporation yesterday.
 
The BBC pay report named 96 of its highest-paid broadcasters, who earn more than £150,000 each year. Released under new government rules, the list has provoked debate – not least because two-thirds of those listed are men.
 
A large gender pay gap – and the fact that the corporation's top seven highest paid stars are all men – reflected badly on the BBC and attracted widespread criticism. Agents for a group of the BBC’s female stars are understood to be preparing to demand that the corporation’s bosses offer their clients a pay rise and lawyers have also warned that the BBC will now face sexual discrimination lawsuits.
 
In response, the corporation has pledged to achieve pay equality between men and women on air by 2020 and the BBC’s director of radio and education James Purnell hinted that pay cuts for male presenters could be part of the solution.
 
While some of those named took to social media yesterday to defend their salaries, no doubt other BBC stars were wishing they had salaries that required defending.

NEWS

Scientists in the United States have calculated that humanity has manufactured 8.3 billion tonnes of plastics since the 1950s – enough debris to cover a country the size of Argentina. The study found that the use of the synthetic material has been accelerating, and that half that total has been made during the past 13 years. The researchers say 79% of plastics are used just once and ony nine per cent are recycled.
 
Emmanuel Macron was confronted with the first crisis of his presidency when the head of the French armed forces resigned in protest at cuts to the defence budget. The row between Macron and General Pierre de Villiers erupted last week over the government's plans to slash 850 million euros from this year's defence budget. Seen as one of the finest officers of his generation, de Villiers's departure triggered howls of indignation from the opposition.

The new leader of Kensington and Chelsea Council rejected calls to resign as she faced cries of "murderers" and "shame on you" from a packed public gallery in Kensington Town Hall. The conservative nominee was formally elected as the new boss of the heavily criticised west London council amid angry scenes at a meeting on Wednesday night. The councillor said she was "deeply sorry" for the "grief and trauma" caused by the blaze in west London.

US Republican senator John McCain has been diagnosed with brain cancerand is reviewing treatment options, according to his office. The tumour was discovered during surgery to remove a blood clot from above his left eye. Tissue analysis revealed that a primary brain tumour known as glioblastoma was associated with the clot, a statement from the Mayo Clinic said. The six-term senator – a former Vietnam prisoner-of-war and 2008 Republican presidential candidate – underwent surgery last Friday.

BUSINESS AND ECONOMY

Profits at retailer Sports Direct plummeted nearly 60% last year, largely as a result of the weaker pound. Underlying pre-tax profit fell to £113.7m, down from £275.2m the previous year, because of "currency movements and increased depreciation charges". Chief executive Mike Ashley said the firm had now taken steps to "minimise the short-term impact of currency volatility". Sports Direct's reputation has been badly hit by revelations about staff conditions at its Derbyshire warehouse.
 
High-level trade talks between the US and China ended yesterday without agreement or future agenda, leaving the Trump administration’s efforts to recast trade ties with Beijing in limbo. The two sides did not issue a joint statement and cancelled scheduled press conferences. The US has been critical of China's trade surplus and demanded "more fair" trade arrangements.

According to Reuters, Morgan Stanley has picked Frankfurt as a new temporary hub to operate in the European Union when Brexit takes effect. The New York investment bank will double staff in the German city to 400 in order to be ready to continue to operate in Europe, putting 200 jobs at risk in London. Citigroup is expected to announce officially this week that it will also be using Frankfurt as its new EU base, while Barclays confirmed it was in talks with regulators in Dublin about expanding its operations there.

MARKETS

What happened yesterday

The FTSE 100 has closed 0.6% higher at 7,430.91 points yesterday.
 
Top of the stocks was accounting software firm Sage, up 2.7%, followed by housebuilders Barratt and Persimmon, both 2.4% higher.
 
Royal Mail was the biggest faller on the London market following a heady rise on Tuesday when it revealed that it had narrowed the decline in letter deliveries thanks to a boost from general election political mailings. Shares were down more than two per cent, or 11.3p to 399.8p.
 
In oil markets, Brent crude prices jumped nearly 1.4% to $49.35 per barrel, after data from the Energy Information Administration showed a bigger-than-expected drop in US energy inventories.
 
In currency markets, sterling was relatively flat against the US dollar, down 0.08% at 1.302, but rose around 0.3% versus the euro to 1.131.

AGMs
Ashmore Global Opportunities Ltd (AGOL), Big Yellow Group (BYG), Caledonia Investments plc (CLDN), De La Rue plc (DLAR), Edinburgh Investment Trust plc (EDIN), Electrocomponents plc (ECM), Experian Plc (EXPN), Flowgroup plc (FLOW), Premier Foods plc (PFD), Royal Mail PLC (RMG), Rurelec Plc (RUR), SSE plc (SSE), Telecom Plus plc (TEP), UKR Product Group (UKR)

Final Results
Sports Direct Intl Plc (SPD)

Trading Announcements
Anglo American (AAL), Hilton Food Group Plc (HFG), Mothercare plc (MTC), Premier Foods plc (PFD), Science In Sport plc (SIS)
SSE plc (SSE)

UK Economic Announcements
(9:30) Retail Sales

International Economic Announcements
(7:00) Producer Price Index (GER)
(9:00) Current Account (EU) 
(12:45) ECB Interest Rate (EU)
(13:30) Continuing Claims (US)
(13:30) Initial Jobless Claims (US)

 Interim Results
Breedon Group plc (BREE), Howden Joinery Group Plc (HWDN), Moneysupermarket.Com (MONY), Nichols plc (NICL), Unilever plc (ULVR)

COLUMNS OF NOTE

Writing in The Daily TelegraphAngela Epstein calls on the BBC to examine the earnings of its top managers, rather than those of its top stars. Epstein, a regular contributor to BBC programmes on TV and radio, concludes that “in focusing on the wage bill of BBC entertainers, we lose sight of the colossal amount of money spent elsewhere”.

Ros Altmann, a Conservative peer and pension campaigner, writes in The Guardian on the decision of the government to increase the UK state pension age to 68. She calls for more flexibility, which would allow people to start claiming their pension earlier if required. Baroness Altmann also proposes that social care should be incorporated into national insurance.

DID YOU KNOW?

The highest title in karate is called Hanshi, awarded to a ninth or tenth degree black belt. The “Han” in Hanshi means “example or model” and indicates “a teacher that can serve as an ideal model for others”.

PARLIAMENTARY HIGHLIGHTS

TODAY

House of Commons
Oral questions
Environment, Food and Rural Affairs (including Topical Questions)
General debate
Matters to be raised before the forthcoming adjournment
Adjournment
Future of the NHS - Richard Drax

House of Lords
Oral Questions
Priorities for transport investment in the North East of England - Baroness Quin
Debate
Transport needs of remote island communities in England - Lord Berkeley
Short debate
Leaving Euratom and ensuring the continued uninterrupted cross-border supply of nuclear materials, including for medical use, post-Brexit - Lord Teverson

Scottish Parliament
In recess until 3rd September

TOMORROW
House of Commons

In recess until 5th September

House of Lords
In recess until 5th September