26 June 2018

Adam Shaw

26 June 2018

Good Morning, 

Late yesterday, the House of Commons voted 415 to 119 in favour of a motion that “approves the National Policy Statement on new runway capacity and infrastructure at airports in the South East of England, which was laid before this House on 5 June 2018”.
 
In plain English: the government won a vote granting approval for a third runway at Heathrow.
 
Few dispute that the UK requires more airport capacity. It’s an issue that has been debated for decades and has taken on increased significance as the government looks to forge “global Britain” post-Brexit.
 
However, issues such as air pollution, the impact on the local area, and question marks over its location have meant that the planned expansion of Heathrow has been stuck in a holding pattern for years.
 
Despite receiving the green light from parliament, the debate is set to rage on, with a group of councils confirming that they are planning legal action against expansion – a move backed by Greenpeace and Sadiq Khan, the mayor of London.
 
Then there is always the possibility of Labour winning the next general election and halting the project.
 
We certainly haven’t heard the last of the issue and there may still be time for Boris to lie down in front of a bulldozer.

News

The UK should increase defence spending from two percent of GDP (the minimum NATO commitment) to three percent – approximately £60 billion a year – according to a report by the Commons Defence Select Committee. This is necessary to maintain influence with the US and NATO, the committee says. The warning comes on the back of reports that Gavin Williamson, the defence secretary, has demanded an extra £20 billion for the armed forces and ahead of next month’s NATO summit in Brussels.
 
The Electoral Commission has acknowledged that British democracy may be under threat and has called for urgent reforms to electoral law in the wake of recent online political scandals, such as the revelations relating to Cambridge Analytica. The elections regulator has asked Westminster and the devolved governments to change the law in order to prevent the spread of misinformation, misuse of personal data and overseas interference.
 
The publication of a highly sensitive report into the UK’s involvement in rendition and torture during the war on terror, which is due on Thursday after an eight-year wait, has been complicated by last-minute changes demanded by the US government. The report will call for sweeping changes to protocols affecting how British spies operate in the field, and greater ministerial oversight to ensure political accountability. Human rights campaigners have said that accommodating US changes would undermine the credibility of the report.

 

Business & Economy 

BMW has joined Airbus in issuing warnings about the impact of Brexit on its business. According to Stephen Freismuth, the company’s customs manager, the car manufacturer will be forced to close its UK plants if it cannot quickly and reliably import parts from mainland Europe after Britain leaves the EU. BMW currently has four UK facilities that directly employ 7,000 people.
 
In other car industry news, The Society of Motor Manufacturers and Traders has published figures showing that investment in the UK’s car industry has fallen by half. In the first six months of 2017, investment in new models and factory improvements stood at £647.4 million. For the same period this year, the figure was £347.3 million – the lowest since the financial crisis. The trade body attributed the fall to Brexit uncertainty, which is “thwarting” decisions by major car companies to put more money into their UK facilities.
 
President Trump has criticised Harley Davidson for “waving the white flag”, after the company announced plans to move production of some of its bikes out of the US in response to EU tariffs on motorcycle imports. The manufacturer said that the EU response to new US steel tariffs would add $2,200 to the average cost of a motorcycle exported to Europe and the move “represents the only sustainable option to make its motorcycles accessible to customers in the EU and maintain a viable business in Europe.”

Markets 

What happened yesterday?
Global stocks suffered yesterday on the back of weekend reports that President Trump is preparing to escalate the US-China trade dispute by restricting Chinese investment in US companies. As a result, all major indices were down.
 
However, Steve Mnuchin, the US Treasury secretary, later tweeted that the measures will be “not specific to China, but to all countries that are trying to steal our technology”.
 
The Nasdaq saw the biggest fall, dropping 2.09%, whilst the S&P 500 shed 1.37% and the Dow Jones Industrial Average was down 1.33%. Nasdaq listed semiconductor manufacturer Micron Technology, which earned more than half its revenue from China last year, was among those with the steepest declines, dropping 6.9%.
 
In the UK, the FTSE 100 was down 2.24% to 7,509.84. Just three constituents – ITV, United Utilities Group and Associated British Foods – made gains, whilst Old Mutual and Sky finished the session level. All other companies ended the day down.
 
Cruise company Carnival was the worst performer, losing 11.13%. Mining companies also had poor session with Glencore, Anglo American, BHP Billiton, Evraz, Rio Tinto, and Antofagasta all dropping more than three percent.
 
On the currency markets, the pound was up 0.1% against the dollar at $1.3281 but down 0.27% against the euro at €1.1347.

 

Finals
Carpetright, HML Holdings, Northgate, Thruvison Group
 
Interims
Blue Prism Group
 
Trading Announcements
Capita

UK Economic Announcements
(09:30) BBC Mortgage Lending Figures
(11:00) CBI Distributive Trades Surveys

AGMs
Achp, Altus Strategies, Chesterfield Resources, Capita, Echo Energy, Faroe Petroleum, Griffin Mining Ltd., Hummingbird Resources, JZ Capital Partners Ltd., LXI Reit, Morses Club, Marwyn Value Investors Limited, Surgical Innovations Grouo, Trans-Siberian Gold, Universe Group, Westminster Group
 
EGMs
CVC Credit Partners European Opportunities Ltd GBP, JZ Capital Partners Ltd

 

Columns of Note 

Writing in The Times, Rachel Sylvester bemoans the Conservative Party’s change of tone towards the business community in the face of Brexit – citing weekend criticism of Airbus and Boris Johnson’s widely reported comments. Comparing the UK economy to a plane in distress, she suggests that “it may take a large factory closure, or the relocation of a big corporate headquarters, to jolt the pilot awake in the cockpit, but the lights are undoubtedly flashing on the dashboard”. Sylvester concludes by saying that, having lost the confidence of young people, ethnic minorities and women, the Tories cannot afford to sacrifice the support of business too.
 
In the Financial Times, John Thornhill examines developments in cyber warfare. Whilst interconnectivity has massive benefits, it also leaves us vulnerable, with every device a potential weak point and a gateway to the network. Thornhill highlights that adversaries of the west see cyber capabilities as a way of countering traditional US military dominance and the subsequent decision by Washington to shift towards a more offensive cyber strategy. This, he says, could inadvertently prompt a cyber war, which we do not fully understand.

Did you know? 

Cameroon’s Roger Mila holds the record as the oldest goal scorer at a men’s world cup finals. He was 42 when he found the net against Russia in 1994.

Parliamentary highlights 

TODAY
 
House of Commons
 
Oral Questions: Foreign and Commonwealth Office (including Topical Questions)
 
Ten Minute Rule Motion: Food Advertising (Protection of Children from Targeting) – Kirstene Hair
 
Motions
 
To approve a Statutory Instrument relating to the Draft European Union (Definition of Treaties) (Canada Trade Agreement) Order 2018 - Dr Liam Fox
To approve European Documents relating to EU Trade Agreements: EU-Japan Economic Partnership Agreement
 
Consideration of Lords amendments: Automated and Electic Vehicles
 
Legislation: Haulage Permits and Trailer Registration Bill [Lords] – remaining stages
 
House of Lords
 
Oral Questions
 
Definition of anti-Semitism adopted by the International Holocaust Remembrance Alliance - Lord Leigh of Hurley
Implementation of the benefits package for communities in areas surrounding Hinkley Point C - Baroness Featherstone
Improving the performance of Border Force at UK airports and reducing delays in clearing EEA and non-EEA passengers through immigration - Lord Blunkett
Risk assessment published by Airbus of the business impact of the UK's withdrawal from the European Union - Lord Haskel
 
Debate: Forthcoming NATO Summit - Report from the International Relations Committee 'The NATO Summit 2018' - Baroness Goldie
 
Short Debate: Provision of high quality youth services for young people in England - Lord Storey
 
Scottish Parliament
 
Topical Questions
 
Scottish Government Debate: Defending the Powers of the Scottish Parliament
 
TOMORROW
 
House of Commons
 
Oral Questions: Chancellor of the Duchy of Lancaster and the Minister for the Cabinet Office (including Topical Questions)
 
Prime Minister’s Question Time
 
Ten Minute Rule Motion: Toilets (Provision and Accessibility) – Paula Sherriff
 
Legislation: Offensive Weapons Bill – 2nd reading
 
Money Resolution: Offensive Weapons Bill – Mel Stride
 
House of Lords
 
Oral Questions
 
Monitoring of hate speech against non-Muslims in preaching in mosques and teaching in madrassas in England and Wales - Lord Pearson of Rannoch
What benefit the Government anticipate from the increased funding recently announced for grammar schools - Lord Bassam of Brighton
Impact of the outcome of the general election on 24 June on the govenment of Turkey’s treatment of those in prison - Lord Balfe
Review of the effectiveness of the National Probation Service - Lord Beecham
 
Legislation
 
Civil Liability Bill [HL] - Third reading - Lord Keen of Elie
Domestic Gas and Electricity (Tariff Cap) Bill - Report stage - Lord Henley
 
Scottish Parliament
 
Portfolio Questions: Communities, Social Security and Equalities
 
Ministerial Statement: Ending homelessness together - Actions recommended by the Homelessness and Rough Sleeping Action Group
 
Stage 1 Debate: Prescription (Scotland) Bill
 
Standards, Procedures and Public Appointments Committee Debate: Complaint against Mark McDonald MSP