24 April 2018

@ScottReid1992

24 April 2018

Good morning,

“We shouldn’t cut off our nose to spite our face.”
 
Such was the encouragement from a Whitehall source yesterday, as the prime minister attempts to see off threats of a Brexiteer cabinet revolt by keeping open the possibility of a customs union with the EU ahead of a crunch meeting later today.
 
And as rumours of a cabinet fracture rumble into their second day at the top of the news agenda (barring further wall-to-wall coverage of the royal birth, of course), it is hard to deny that the prime minister is in a tricky position.
 
On the one hand, Eurosceptic cabinet ministers, including David Davis, Liam Fox, Michael Gove and Boris Johnson, are expected to warn that giving way on the customs union could risk undermining the Brexit process in its entirety. On the other, the Chancellor Philip Hammond and other leading soft Brexiteers will argue that it is “premature” to take any future partnership models off the table at a time when negotiations with Brussels have stalled.
 
One solution might be to take the decision out of the cabinet’s hands. Downing Street yesterday refused to rule out making a symbolic parliamentary vote on the customs union next month an effective vote of confidence in Theresa May and her government. This could be a shrewd manouevre by the PM. Even if the parliamentary arithmetic within her own party doesn’t add up for her vision of Brexit, I’d wager there would be far less appetite to risk ushering in a Corbyn government.
 
It may be clichéd, but the prime minister looks damned if she does give way on the customs union and damned if she doesn’t. Such a decisive move of forcing a vote of confidence in the Commons would be out of character for someone that has clung on so far by mastering the art of political fudge. But should cabinet talks go awry today, Theresa might find that the decision is not her’s to take.

NEWS

10 people have been killed and 15 injured after a van ploughed into pedestrians on Yonge Street in Toronto, Canada, yesterday. The suspected driver of the rented van, Alek Minassian, 25, was apprehended close to the scene, and was not previously known to authorities. Toronto police have said it is too early to identify it as a terror-related attack.
 
The US Senate has narrowly endorsed Mike Pompeo as secretary of statepaving the way for a quick confirmation by the House of Representatives. Nine Democrats on the Senate Foreign Relations Committee voted against Pompeo, but were outnumbered by 11 Republicans after Rand Paul, a libertarian Republican who opposed Pompeo’s interventionist approach to war, supported the nominee in a last-minute decision. The vote will likely allow Pompeo to attend a Nato summit on Friday. (£)
 
Serzh Sargsyan has resigned as Prime Minister of Armenia, prompting widespread celebrations in the Armenian capital Yerevan. Sargsyan had only been in post a week after serving 10 years as president, but resigned following 11 days of mass protests. Opposition leader Nikol Pashinyan was also released from detention, having been arrested on Sunday after calling for Sargsyan’s resignation during televised talks. Former prime minister Karen Karapetyan has taken over as acting prime minister.
 
The Duke and Duchess of Cambridge have left hospital after the birth of their third child, a boy. The couple’s second son, who is yet to be named, was born at 11.01am yesterday at the Lindo Wing of St Mary’s Hospital, London, and weighed 8lb 7oz. He is fifth in line to the throne.

BUSINESS AND ECONOMY

The government is considering intervening in the purchase of the national Express and Star titles by Trinity Mirror, after the sale was flagged by the Competition and Markets Authority. Matt Hancock, the culture secretary, said that he was “minded” to issue a public interest intervention notice, citing the need to ensure “free expression of opinion” and a “sufficient plurality of views”. Titles owned by the expanded Trinity Mirror, which is changing its name to Reach, will reach nearly 18% of the market. (£)
 
Google owner Alphabet has reported earnings of $9.4 billion in the first quarterof the year, defying expectations that the firm may be hit by a row over internet privacy. Earnings at the tech giant were nearly three quarters more than in the same period in 2017, boosted by digital advertising. Alphabet, which is valued at $750 billion, is the world’s second largest public company after Apple. (£)
 
Analysts have predicted that crude oil prices could reach $100 a barrel in 2018as a result of mounting geopolitical uncertainty. According to The Telegraph, investors have pointed to “perfect storm” conditions involving a proxy-war between Saudi Arabia and Iran, the likelihood that the US will introduce oil sanctions against Iran on May 12 and a delayed investment boom from 2014. Other issues include the extension of production caps between Saudi Arabia and Russia, and the collapse of Venezuela’s oil industry in recent months. Brent crude was trading at $75 a barrel at close of business yesterday. (£)

MARKETS

What happened yesterday?
The London markets enjoyed a relative boost on Monday as easing geopolitical and trade tensions, and optimism in corporate earnings buoyed investor enthusiasm following a week marked by disappointing economic indicators. By close of trading, the pound was down 0.35% against the greenback at $1.40, and up 0.25% versus the euro at €1.14, whilst the FTSE 100 was up by 0.42% or 30.70 points to 7,398.87.
 
In corporate news, Capita was among day’s the standout gainers, with shares in the outsourcer surging 13.14% as investors responded enthusiastically to news of £701 million rights issue. Shares started Monday trading at 70p each, or a discount of 56.2% on their Friday closing value. Wealth manager St James Place was also up 3.33% ahead of an update on its performance due later today.
 
On the other end of the scale, shares in hospitality group Whitbread (down 0.07%) edged lower following a Sunday Times report which suggested that chief executive Alison Brittain is open to the idea of spinning subsidiary Costa Coffee from Premier Inn hotels.
 
Overall gains on the stock markets, however, made for an unstable day on the currency markets. The pound fell to its lowest level in five weeks against the dollar amid reports of a potential cabinet revolt, finishing down 0.35% at $1.40. This was partially offset by sterling’s gains against the euro, closing up 0.25% at €1.14.

Finals
Atlas Mara Limited (DI)
Circassia Pharmaceuticals
CityFibre Infrastructure Holdings
Inspiration Healthcare Group
Osirium Technologies
Proteome Sciences
Sportech
Sumo Group
 
Interims
AB Dynamics
Proactis Holdings
 
Trading Announcements
Anglo American
London Stock Exchange Group
St James’s Place

Annual Report
SpaceandPeople

 

UK Economic Announcements
(09.30) Public Sector New Borrowing
(12.00) CHI Industrial Trends Surveys

AGMS
AFC Energy
Alfa Financial Software Holdings
Biome Technologies  
CVC Credit Partners European Opportunities Ltd GBP
ECR Minerals  
Empiric Student Property       
Frontier Smart Technologies Group Limited 
Hammerson
London Stock Exchange Group
Metro Bank
Premier Global Infrastructure Trust  
Pershing Square Holdings Ltd NPV
SpaceandPeople
Scotgems       
Tern
Tribal Group
UK Oil & Gas Investments
 
Int. Economic Announcements
(09.00) IFO Business Climate (GER)
(09.00) IFO Currency Assessement (GER)
(09.00) IFO Expectations (GER)
(14.00) House Price Index (US)
(15.00) New Homes Sales (US)

 

COLUMNS OF NOTE

Gideon Rachman comments in the FT that the customs union decision is the most significant to date, given that it marks the line between so-called “hard”, “soft” or possibly no Brexit. Rachman suggests that the concessions involved in making a customs deal palatable to parliament, cabinet and the EU are likely to prove an ask too much, and could provoke a fall of the government. (£)
 
Jane Coaston, writing for Vox, looks at the upcoming celebration of Confederate Memorial Day in the US on April 30, and asks “how multiple states can celebrate treason in defense of slavery”. Coaston concludes that these sorts of days are purely politically motivated, and instead of honouring the Civil War dead, merely serve to terrify the living – especially African Americans – and exonerate the antebellum South.

DID YOU KNOW?

In Korean folklore, instead of “Once upon a time”, stories tend to begin with “Back when tigers used to smoke”.
 
The phrase originates in the 17th century when tobacco became a luxury item in Korea, having previously been widely used by all social classes as a medicinal product. Tigers were also commonly sighted in the country’s mountains and forests, and the phrase caught on to refer to an era when both were once ubiquitous, but had now passed from common memory. 

PARLIAMENTARY HIGHLIGHTS

TODAY
 
House of Commons
 
Oral questions
Justice (including Topical Questions)
 
Ten Minute Rule Motion
Unsolicitied Calls (Prevention) – Stephen Kerr
 
Legislation
Financial Guidance and Claims Bill [Lords] – remaining stages
 
Mental Health Units (Use of Force) Bill – money resolution
 
Adjournment
Rollout of The National Bereavement Care Pathway – Will Quince
 
House of Lords
 
Oral questions
Processes by which Israel might be held accountable for its treatment of the inhabitants of Gaza -  Lord Hylton
 
Encouraging the adoption of artificial intelligence in the NHS -  Lord Holmes of Richmond
 
Integrated Communities Strategy green paper and schools -  Viscount Ridley
 
Increasing the contribution made by the voluntary sector to the delivery of probation services -  Lord Ramsbotham
 
Legislation
Haulage Permits and Trailer Registration Bill [HL] – Third Reading - Baroness Sugg
 
Civil Liability Bill [HL] - Second reading -  Lord Keen of Elie
 
Scottish Parliament
Topical Questions
 
Scottish Government Debate
National Plan for Gaelic
 
Members’ Business
Show Some Heart, the Jayden Orr Campaign – Stuart McMillan
 
TOMORROW
 
House of Commons
 
Oral questions
Scotland
 
Prime Minister’s Question Time
 
Ten Minute Rule Motion
Health Impacts (Public Sector Duty) – Luciana Berger
 
Opposition Day Debate
Schools -  Jeremy Corbyn
 
Social care -  Jeremy Corbyn
 
Debate
Section 5 of the European Communities (Amendment) Act 1993
 
Adjournment
Law on use of digital images and consent -  Meg Hillier
 
House of Lords
 
Oral questions
Assisting high street retailers to prevent further closures and job losses - Lord Naseby
 
Action to promote freedom of religion or belief as part of the human rights agenda to be discussed at the Commonwealth Summit -  Baroness Berridge
 
Gender pay gaps in academy schools and trusts -  Lord Storey
 
Legislation
European Union (Withdrawal) Bill – Report (day 3) -  Lord Callanan
 
Scottish Parliament
 
Portfolio Questions
Justice and the Law Officers
Culture, Tourism and External Affairs
 
Stage 3 Proceedings
Social Security (Scotland) Bill