3 January 2019

Katie Stanton

3 January 2019

Good morning,

I don’t know about you but after a fun festive period of eating, drinking, carousing and generally not knowing what day of the week it is, my alarm this morning brought me crashing back down to earth.   

Happily, the same can’t be said for China’s Chang’e-4 probe, which executed a rather more graceful landing on the far side of the Moon in the wee hours of this morning, in the first ever attempt at such a landing.

The probe touched down in the South Pole-Aitken Basin, the Moon’s oldest, deepest crater, carrying instruments to characterise the geology of a region that remains unexplored thus far. Chinese state media hailed the landing “a major milestone in space exploration”, paving the way for a sample return mission in late 2019.

But the exercise represents much more than just a scientific success – geopolitical cards are at stake too. China’s space programme is seen as a key constituent of the nation’s rise as a superpower.

According to the BBC’s China correspondent John Sudworth, the value of the successful mission as propaganda for the ambitious regime “was underscored by careful media management” – with very little news of the mission before it was officially declared a success.

A relative late starter to the space race, China is now playing catch up. Malcolm Davis, a senior analyst in defence strategy and capability at the  Australian Strategic Policy Institute, noted that the development is likely to “set a fire under the Americans” as it seems the race is on to establish a military dominance in space.

In a time defined by tensions between the two countries, the daring mission will not go unnoticed by the current occupant of the White House.

News 

Sajid Javid has enlisted the assistance of the Royal Navy to help deal with the increase in refugees attempting to cross the English Channel over the festive period. Making a “broad” request for support, the home secretary warned that desperate families could drown in their attempts. The news comes after two men were held in Manchester on suspicion of arranging the illegal movement of migrants across the Channel.

New analysis of government data from environmental analysis outlet Carbon Brief has found that energy efficient products have cut CO2 emissions more than renewable energy has. EU product standards on light bulbs, fridges and other appliances have played a substantial part in reducing energy demand.

Universities are on the brink of a “credit crunch”: the sector’s debts skyrocketed to £10.8 billion over the past year, three times more than figures from before the 2008 financial crisis. Increased borrowing comes amid “unprecedented uncertainty” for higher education, as ministers consider cutting tuition fees and Brexit threatens foreign student numbers.

Business & Economy

Apple released a rare revenue warning late last night. The tech giant blamed economic weakness in China and disappointing iPhone upgrades in the developing world for a 10 per cent shortfall in anticipated revenue. The announcement wiped over 7 per cent from Apple’s share price, extending its downward slide in what is usually the strongest quarter for the company. (£)

According to the British Chambers of Commerce (BCC), the British economy is in a “weak holding pattern” and UK firms are struggling against labour shortages, rising prices and declining sales. Director general Dr Adam Marshall urged the government to listen more closely to business when deciding on immigration policies and to increase clarity over Brexit.

John Lewis Partnership saw an 11% rise in sales in the last week of 2018 compared with a year earlier, offering a glimmer of hope for the high street. Waitrose sales provided the lion’s share of the boost, rising 19.2%. The retailer reported lower sales for the previous week however, so sales remain flat for its financial year so far. (£)

Markets

What happened yesterday? 

The FTSE 100 ended flat yesterday after a dismal start to 2019. Brexit uncertainty is the main contributing factor, as well as fears of a global economic slowdown. The index closed 0.1% higher at 6,734, recovering from an initial fall as the price of crude oil rose four per cent. 

Next was the top of the risers yesterday, climbing 4.6% to £41.77 ahead of today’s trading announcement. The retailer reported sales in line with the guidance given in September and up 1.5% on the previous year. The FTSE 250 ended up 0.5%, with British infrastructure provider Stobart leading the winners yesterday, climbing 8.4%.

Global markets also had a gloomy start to 2019, with investors cautious of the effects of the US federal government shutdown and the impact of the trade war between the US and China. The decline in equities follows the worst year for global stock markets since 2008.

Data published yesterday indicated that China’s manufacturing sector is contracting, sending Asian equities down and adding to market volatility on the first day of trading in 2019. 

On the currency markets, the pound was down 1.22% against the dollar and 0.21% against the euro.

Trading Announcements

Next

Staffline Group

AGMs

PCG Entertainment (DI)

Wishbone Gold

UK Economic Announcements

(09:30) PMI Construction 

Int. Economic Announcements

(09:00) M3 Money Supply (EU)

(12:00) MBA Mortgage Applications (US)

(13:30) Continuing Claims (US)

(13:30) Initial Jobless Claims (US)

(15:00) ISM Manufacturing (US)

(20:30) Auto Sales (US) 

Columns of Note

Last year Alice Thomson’s new year resolution was to read 52 books. She writes in The Times that the most “successful, innovative and robust people” are often the most avid readers, inspiring her to follow in their footsteps. After completing her resolution, Thomson reports that she felt happier and calmer despite a stressful year. (£)

In his column for The Sunday Times last week, Kevin Pringle urged people of all views to share their political doubts in the new year. Rather than “pretending to be certain about everything”, Pringle seeks to enrich debate by exploring his doubts surrounding the Scottish independence campaign. Perhaps it is time to accept that some of our brazen political truisms are actually nothing of the sort.

Did you know? 

After an office in Georgia banned emails on Fridays, forcing colleagues to speak to each other, one employee discovered a co-worker he emailed regularly was not across the country, but in fact working on the same floor as him.

Parliamentary highlights 

House of Commons

Business will resume from Monday 7 January 2019

House of Lords 

Business will resume from Monday 7 January 2019 

Scottish Parliament

Business will resume from Monday 7 January 2019