22 March 2018

@scottreid1992

22 March 2018

Good morning,

Sacre bleu!
 
No, I’m not talking about the news - which might trouble some more extreme Brexiteers - that the British firm De La Rue has lost out to Franco-Dutch firm, Gemalto, in the tender to manufacture Britain’s blue passport once it returns after Brexit.
 
Instead, I refer to the rather more shocking arrest and formal charge yesterday of former French president, Nicholas Sarkozy, on allegations that his 2007 presidential campaign received €50 million in illegal funding from the Libyan regime of Muammar Gaddafi.
 
In a bombshell, but not altogether implausible twist for French politics, magistrates in the Paris suburb of Nanterre said they were placing Sarkozy under what is known as formal investigation in France, on the grounds of passive corruption, illegal electoral campaign funding and – perhaps most damning of all – concealing Libyan public funds. Sarkozy denies the charges which risk a maximum sentence of ten years in prison if found guilty.
 
However, the investigation itself is not new. A 2012 report first raised suspicion in the then president and was followed up in 2016 when Ziad Takieddine, a French-Lebanese arms dealer who introduced Sarkozy to Gaddafi, was interviewed by the news website Medapart. Takieddine claims he delivered three suitcases stuffed with €5 million cash intended for Sarkozy’s campaign to his then-chief of staff, Claude Guéant, in 2006 and 2007. Guéant – who was later Sarkozy’s interior minister – was charged in connection with the investigation earlier this year over a €500,000 bank transfer in 2008.
 
The details are certainly worth pouring over with your morning coffee not least for their political ramifications. Sarkozy’s government, after all, was spearheaded by his coordination of international military action against Gaddafi which resulted in the toppling and killing of the Libyan dictator. He was also a whisker away from standing in the centre-right Republican primary for the presidency just last year.
 
But as they say, nothing is new under the sun, and if convicted, Sarkozy would follow the sentencing of his predecessor as president, Jacques Chirac, on similar charges of money laundering in 2011. In the meantime, this is one coup de theatre for which I’ll be getting the popcorn in.Sacre bleu!
 
No, I’m not talking about the news - which might trouble some more extreme Brexiteers - that the British firm De La Rue has lost out to Franco-Dutch firm, Gemalto, in the tender to manufacture Britain’s blue passport once it returns after Brexit.
 
Instead, I refer to the rather more shocking arrest and formal charge yesterday of former French president, Nicholas Sarkozy, on allegations that his 2007 presidential campaign received €50 million in illegal funding from the Libyan regime of Muammar Gaddafi.
 
In a bombshell, but not altogether implausible twist for French politics, magistrates in the Paris suburb of Nanterre said they were placing Sarkozy under what is known as formal investigation in France, on the grounds of passive corruption, illegal electoral campaign funding and – perhaps most damning of all – concealing Libyan public funds. Sarkozy denies the charges which risk a maximum sentence of ten years in prison if found guilty.
 
However, the investigation itself is not new. A 2012 report first raised suspicion in the then president and was followed up in 2016 when Ziad Takieddine, a French-Lebanese arms dealer who introduced Sarkozy to Gaddafi, was interviewed by the news website Medapart. Takieddine claims he delivered three suitcases stuffed with €5 million cash intended for Sarkozy’s campaign to his then-chief of staff, Claude Guéant, in 2006 and 2007. Guéant – who was later Sarkozy’s interior minister – was charged in connection with the investigation earlier this year over a €500,000 bank transfer in 2008.
 
The details are certainly worth pouring over with your morning coffee not least for their political ramifications. Sarkozy’s government, after all, was spearheaded by his coordination of international military action against Gaddafi which resulted in the toppling and killing of the Libyan dictator. He was also a whisker away from standing in the centre-right Republican primary for the presidency just last year.
 
But as they say, nothing is new under the sun, and if convicted, Sarkozy would follow the sentencing of his predecessor as president, Jacques Chirac, on similar charges of money laundering in 2011. In the meantime, this is one coup de theatre for which I’ll be getting the popcorn in.

News

Mark Zuckerberg has admitted Facebook’s association with Cambridge Analytica represented a “major breach of trust” (£). In an interview with CNN on Wednesday, the co-founder and CEO of Facebook said he was willing to testify to any US government inquiry and was open to further regulation of the website. ISBA, a group representing up to 3000 advertisers in Britain including P&G and Unilever, has threatened to withdraw support for Facebook (£) if it is found that users’ data was used in any way by brokers and political campaigners without authorisation.
 
EU leaders are to meet at a European Council summit in Brussels today at which they are expected to approve the terms of a transition deal with the UK after Brexit. The draft deal would see the UK remain subject to the rules of the single market and customs union for a 21-month period after the UK formally leaves, but still able to strike its own trade deals. It has been suggested that Spain could withhold its consent over concerns how the agreement would affect its relationship with Gibraltar.
 
Boris Johnson has been critcised for comparing the way President Putin is promoting the 2018 football World Cup in Russia to the 1936 Berlin Olympics in Nazi Germany. Speaking in front of the foreign affairs select committee over the Salisbury poisonings, the foreign secretary raised concerns for the way England fans will be treated in Russia but stopped short of supporting a boycott. A Russian foreign ministry spokeswoman said Johnson’s comments were “poisoned with venom of hate”.

 

Business & Economy

The US Federal Reserve has decided to raise the interest rate by 0.25% to a target range of 1.5% to 1.75%. Leading his monetary policy meeting as chairman, Jerome “Jay” Powell also signaled policymakers would increase rates twice more this year, and raised the forecast for rate hikes in 2019. Continuing the caution characteristic of his predecessor, Janet Yellen, Powell insisted the Fed was taking the “middle ground”, and downplayed the possibility of a sharp acceleration in inflation.
 
The US is set to announce sanctions against China today after determining the country is encouraging the theft and transfer of intellectual property  from US businesses (£). Considering ways to mitigate the impact of new steel and aluminum tariffs for it’s allies, the Trump administration also highlighted the possibility that the EU and Japan could be exempted from the price rises. The tariffs to be imposed on China are expected to be worth at least $30 billion.
 
Global dealmaking surpassed $1 trillion for the first time in 2018 on Tuesday, the quickest it has ever been achieved within a new year (£). The FT reports that dealmaking is up by more than 50% from a year ago and 12% higher than at the same point in 2007. The wave of consolidations has been strongest in the US, UK, China, Germany and Japan and has been attributed to strong global economic growth and the introduction of tax cuts in the US at the end of last year.

Markets

What happened yesterday?
London stocks slipped on Wednesday as the pound continued its upward trajectory on the unexpected news that wage growth in the UK was shown to have accelerated at the start of the year. Struggling to keep up, the FTSE 100 closed down 0.32% at 7,038.97, while the pound was up 0.55% against the dollar at $1.41 and 0.37% higher versus the euro at €1.15.
 
The Office for National Statistics showed UK average weekly earnings in the three months to January rose by 2.8% compared to the same period last year, beating economists’ predictions of 2.6%, and up on the figure from a month earlier, which was revised up to 2.7% from 2.6%. Coupled with an announcement just after close of trading that the US Federal Reserve will increase interest rates, the news will likely train investors’ attention on the BoE and speculation of a rate rise here when the monetary policy committee meets tomorrow.
 
In corporate news, retailers were the day’s biggest fallers after B&Q and Screwfix owner Kingfisher (down 10.69%) reported an eight per cent fall in annual profits on flat sales and issued a very cautious outlook. It was joined at the bottom of the pack by Whitbread (down 2.99%) whose stock slipped after Morgan Stanley suggested occupancy rates declined last month. At the other end of the scale, stocks in shopping centre developer Hammerson jumped (up 5.24%) after rumours that talks over a proposed merger with competitor Intu Properties had stalled. 

Finals
Allied Minds
Cello Group
Cambridge Cognition Holdings
Franchise Brands
Gamma Communications
Genel Energy
India Capital Growth Fund Ltd.
Inspired Energy
Lamprell
Quixant
Regional REIT Limited
Sabre Insurance Group
Safestyle UK
Soco International
Sanne Group
Sopheon
Secure Trust Bank
Ted Baker
Venture Life Group
Wentworth Resources Ltd (DI)
 
Interims
Produce Investments
 
Trading Announcements
Crest Nicholson Holdings
Halma
 
GMs
Banco Santander S.A.

 

AGMs
BB Healthcare Trust (Red)
Beazley
Brunner Inv Trust
Crest Nicholson Holdings
Independent Inv Trust
Blackrock Throgmorton Trust
 
EGMs
JKX Oil & Gas
 
Annual Report
Barclays
Metro Bank
 
UK Economic Announcements
(09.30) Retail Sales
(12.00) BoE Interest Rate Decision
 
Intl. Economic Announcements
(09.00) Current Account (EU)
(09.00) IFO Business Climate (GER)
(09.00) IFO Current Assessment (GER)
(09.00) IFO Expectations (GER)
(12.30) Continuing Claims (US)
(12.30) Initial Jobless Claims (US)
(13.00) House Price Index (US)
(14.45) PMI Manufacturing (US)

Columns of note

David Aaronovitch comments in The Times that the widespread accusation by Corbyn supporters that BBC’s Newsnight doctored the Labour leader’s hat to look more Russian when reporting his remarks following the Salisbury poisoning, is evidence of a worrying cult of personality in British politics. Aaronovitch suggests so-called “Hat-gate” is intended to excuse Corbyn of responsibility for his actions, where instead criticism should inform his policymaking. (£)
 
Writing in the FT, John Gapper comments that the suspended chief of Cambridge Analytica was an expert to identify the business opportunity in pairing a flaw in Facebook’s systems with university research. The legacy of the scandal, he concludes, is that more people like Alexander Nix will emerge, so long as personal, demographic and spending data remain the world’s premier currencies as they are now. (£)

 

Did you know?

During the Vietnam War, Vietnamese soldiers wore a form of sandal made with the tread facing backwards in order to fool opponents on their direction of travel and lead them into an ambush.

Parliamentary highlights

TODAY
   
House of Commons
Oral questions
Digital, Culture, Media and Sport (including Topical Questions)
 
Attorney General
 
Business Statement
Business Questions to the Leader of the House – Andrea Leadsom
 
General debate
The Economy
 
Adjournment
Phenylketonuria and KUVAN – Vicky Ford
 
House of Lords
Oral questions
Power to call for evidence of the Government's review of press sustainability in the UK - Lord Stevenson of Balmacara
 
Permitting US companies to bid for NHS contracts as part of any future UK–US trade deal - Lord Brooke of Alverthorpe
 
Establishing a statutory regulator of media advertising - Baroness Hayter of Kentish Town
 
Social costs of fixed-odds betting terminals - The Lord Bishop of St Albans
 
Debate
The Commonwealth Heads of Government Meeting 2018 - Lord Ahmad of Wimbledon
 
Report from the International Relations Committee 'Commonwealth Heads of Government Meeting 2018' - Lord Howell of Guildford
 
Motion
Legislative Reform Measure – motion to approve - The Lord Bishop of Rochester
 
Mission and Pastoral etc. (Amendment) Measure – motion to approve - The Lord Bishop of Rochester
 
Pensions (Pre-consolidation) Measure – motion to approve - The Lord Bishop of Rochester
 
Statute Law (Repeals) Measure – motion to approve - The Lord Bishop of Rochester
 
Ecclesiastical Jurisdiction and Care of Churches Measure – motion to approve - The Lord Bishop of Rochester
 
Short debate
Support available to survivors of domestic abuse and preventing further abuse - Baroness Lister of Burtersett
 
Scottish Parliament
General Questions
 
First Minister’s Questions
 
Members’ Business
Down’s Syndrome Awareness Week – Johann Lamont
 
Scottish Government Debate
Building Greater Fairness in the Workplace
 
TOMORROW
 
House of Commons
No business scheduled
 
House of Lords
Legislation
House of Lords (Hereditary Peers) (Abolition of By-Elections) Bill [HL] - Committee stage - Lord Grocott
 
House of Lords (Hereditary Peers) (Abolition of By-Elections) Bill [HL] - Committee stage - motion to regret - Lord Trefgarne
 
Conscientious Objection (Medical Activities) Bill [HL] – Committee stage - Baroness O'Loan
 
Scottish Parliament
No business scheduled