3 October

@suearthur

3 October

Good morning,

The Conservative party conference continues in Manchester today as party members and leaders take the opportunity to do some soul searching. Understandably, they have been looking back to June's general election and questioning how they could appeal more to the youth vote in future.

Just two years ago, the split in support between Labour and the Conservatives among 18 to 29-year-olds was fairly even, 36% to 32%. But in June, according to YouGov, that small gap had widened considerably, with Labour on 64% to the Conservatives' 21%.

Aware of the problem, Prime Minister Theresa May has pledged more money for help-to-buy and a freeze on tuition fees, but her attempt to appeal to a core Labour demographic has been criticised as a “Corbyn-lite” attempt to address the issue.

Chancellor Philip Hammond used most of his speech yesterday to demonstrate why Labour’s left-wing economics would be doomed to fail – but he didn’t offer much by way of his own solutions to the challenges of how to appeal to the younger generation. The CBI’s Carolyn Fairbairn described the speech as “strong on diagnosis, but weak on action”.

Ruth Davidson’s advice was more forthright. The Scottish leader said it was time for the party to “man up” and get over its current “nervous breakdown”. Her speech on Sunday was as much a morale boost, drawing from the party’s success in Scotland, as a message to the party to “unite and fight”, spelling out a distinct one-nation vision of how the party can tackle Labour.

She was met with a standing ovation – a clear indication of her popularity. However, to those hoping she would be in pole position for the top job, she dismissed any rumours with: “I love London. No plans to move there myself, but great to visit”.

News

In the worst US shooting in recent history, at least 58 people have been killed and hundreds injured in a mass shooting at a Las Vegas concert. The gunman opened fire from the 32nd floor of the Mandalay Bay Hotel towards an open air music festival. In response, President Trump called the shooting an “act of pure evil.”

In the wake of Sunday’s referendum in Catalonia, the Catalan government has appealed to the EU to help mediate with Madrid in an effort to avoid a “traumatic split”. Speaking at a press conference, Catalan president Carles Puigdemont said “There is no button to push for independence, it does not exist” as he called for a “new understanding” to be reached with Spain. Meanwhile Catalan trade unions have called a general strike today in protest against the “grave violations of rights and freedoms” in Sunday’s ballot. The strike is expected to bring much of the region to a standstill.

Work and Pensions secretary David Gauke told the Conservative party conference yesterday that the rollout of Universal Credit will go ahead, despite concerns raised by Conservative MPs that claimants were being forced to use food banks because of the six week wait to receive money. In addition, Environment Secretary Michael Gove has also confirmed that a bottle deposit return scheme could be introduced across Britain, saying the schemes had been a “great success” in combatting pollution in other countries.

Business & Economy

Uber’s UK boss Jo Bertram has resigned. Bertram was the primary contact with London’s transport authority on regulatory matters. Her resignation came on the eve of a conciliatory meeting scheduled to take place between Uber CEO Dara Khosrowshahi and TfL head Mike Brown. In advance of the meeting, Reuters looks at how Uber has resolved disputes elsewhere.

Transport for London has privately warned that Crossrail 2 could be delayed by a decade in order to raise the funding required for the £31 billion project. The project has not yet received the go ahead as discussions continue on cost.

The Bank of England has ordered big lenders in the UK to find £116bn of funding which must be in place by 2022 as part of a series of measures to ensure taxpayers will not need to bail out the banking sector again. The bank is also expected to publish details of how each of the big lenders would cope if they were to find themselves in difficulty.

Markets

What happened yesterday?
The pound fell to a three-week low against the dollar on the back of data showing that the UK manufacturing sector growth missed expectations. Meanwhile the euro dropped amid tensions in Spain’s Catalonia region.


The FTSE 100 index closed up 0.9% at 7,438.84. The FTSE 250 ended up 0.4% at 19,957.06.

EasyJet ended the day as the best performer on the blue chip index, closing up 5.2%. The airline’s shares benefitted from the news that Monarch would enter into administration. Analysts have suggested that EasyJet may bid for Monarch’s assets, marking another step in the consolidation for the European short-haul market.

Finals
Blancco Technology Group, Ferguson, Revolution Bars Group, SCS Group, St Ives

Trading Announcements
Electrocomponents, Greggs, ITE Group

AGMs
Hargreaves Services, Provexis

UK Economic Announcements
(09:30) PMI Construction

Int. Economic Announcements
(11:00) Producer Price Index (EU)

Columns of Note

Author Andrew Dowling traces the roots of the divisions between Spain and Catalonia, as he considers the way forward after Sunday’s referendum in an FT column. Dowling argues that the violent action of the Spanish police will give independence supporters a new moral legitimacy, and suggests that the situation may result in an increase in acts of civil disobedience.

Hugo Rifkind’s column in The Times argues that in order to appeal to the younger voter, the Conservative party needs to stop speaking the language of capitalism, which is unlikely to resonate with “Generation Rent”.

Did you know?

In the last four years, Cyprus has made at least €4 billion selling citizenships to people from outside the EU.

Parliamentary highlights

TODAY

House of Commons

In recess until 9th October for party conference season

House of Lords

In recess until 9th October for party conference season

Scottish Parliament

Scottish Government Debate: Roll-out of Universal Credit

TOMORROW

Scottish Parliament

Portfolio questions: Health and Sport

Ministerial statement: Delivering Employment support for Scotland

Economy, Jobs and Fair work committee debate: Gender pay gap