4 August

@lyle_h_hill

4 August

Good morning,

As parliament is in summer recess, political news in the UK has dried up to such an extent that pictures of Jeremy Corbyn on a Croatian cycling holiday make headlines.

There is no such respite across the Atlantic for Donald Trump, or special counsel Robert Mueller for that matter, who yesterday announced that a grand jury had been empanelled to investigate claims of Russian meddling in the US election.

Trump responded in his typical combative style at a rally in Huntington, West Virginia. The event drew thousands of Trump supporters in a state the president carried by 42 percentage points in November.

Not only was there a large crowd of Trump fans, but there was also a high profile defection as Democrat Governor Jim Justice switched political allegiances to the Republicans. Justice was a conservative Democrat who refused to endorse Clinton in the presidential election.

If those political machinations weren’t quite enough for one day, Politico reported yesterday that Facebook CEO Mark Zuckerberg has hired pollster Joel Benenson, a top adviser to both Barack Obama and Hillary Clinton.

Earlier in the year, Zuckerberg also hired David Plouffe, campaign manager for Obama in 2008, as president of policy and advocacy at his foundation.

Perhaps that explains why in June Zuckerberg visited “the small towns in Iowa” to chat to truckers and sample the local ice cream. No potential 2020 run for the White House to see there.

News

Professor Tim Briggs, who has been tasked with undertaking the most comprehensive clinical efficiency audit in NHS England’s history, has concluded that the service does not deserve extra money as it currently wastes what it is given on poor care. Professor Briggs believes the NHS could save hundreds of millions a year if best practice was replicated nationwide.

 US police are closing in on Andrew Warren, a treasurer at Oxford University, who is accused of murdering a 26-year-old man in Chicago. Warren and his accomplice, Professor Wyndham Lathem, have been on the run since the 27th July, when Trenton Cornell-Duranleau was found stabbed in an apartment. The police said they “have an idea” of the pair’s whereabouts.

For the second time in two years, a large fire has spread through the Torch Tower in Dubai. Authorities confirmed that civil defence workers “successfully evacuated” the building and the fire is now under control. No injuries have been reported. The tower is the sixth tallest residential building in the world.

 

Business and Economy

The Institute of Directors has called on ministers to stop feuding over the Brexit process and instead agree on the shape and scope of the transitional deal, to add certainty to the Brexit process while any future trading relationship is put in place. The IoD cites “increasing scepticism” that a deal can be reached before the March 2019 deadline.

The Royal Bank of Scotland has reported a profit of £939 million in the first six months of the year. During the same period last year, the bank reported a loss of £2 billion. The profit comes in spite of a £396 million legal bill for mis-sold US mortgage products. Chief executive Ross McEwan called the results “encouraging”.

The UK education group Pearson has announced it will cut 3000 jobs and reduce its dividend in a £300 million cost saving drive. The cost saving cuts will take place until 2020, after the group reported its largest financial loss ever last year. First half operating profits this year were £107 million for the group.

Markets

What happened yesterday?

The Bank of England’s announcement that interest rates would remain unchanged, but that growth forecasts are reduced, sent the pound down but the FTSE 100 up yesterday. Mark Carney also made explicit that the uncertainty around Brexit was beginning to become a drag on UK investment.

Against the dollar the pound dropped 0.6% to $1.3146 and also fell 0.78% against the euro to €1.1068.

The FTSE 100, as it so often does, went in the opposite direction, rising steadily as the pound slumped. The index closed at 7,7475, 63 points higher than at the beginning of trading.

The biggest winner on the day was Next. The clothing firm saw shares rise sharply following a quarterly trading statement that announced an increase in its dividend to shareholders.

At the other end of the spectrum, medical tech company Convatec had a miserable day, slumping 5.6% following a 7.4% drop in operating profit for the first half of the year.

Interims

FBD Holdings, Kennedy Wilson Europe Real Estate, Merlin Entertainments, Pearson, Royal Bank of Scotland Group, RPS Group

Q2 Results

Royal Bank of Scotland Group

AGMs

APQ Global Limited, Bilby, Bluerock Diamonds, Obtala Limited

Trading Announcements

S&U

International Economic Announcements

(07:00) Factory Orders (GER)

(13:30) Balance of Trade (US)

(13:30) Non-Farm Payrolls (US)

(13:30) Unemployment Rate (US) 

Columns of note

Ed Conway, writing in The Times, believes that despite a lack of industrial strategy and a rudderless government all-consumed by Brexit, British business will flourish due to its entrepreneurial spirit. He argues Britain voted to leave the EU, not paralyse government.

Venus is the only planet in the Solar System that spins clockwise on its axis.

Andrew Adonis, writing in the Guardian, argues that the UK couldn’t leave the single market, even if it wanted to. He points to the fact that the UK has not negotiated an international trade deal in decades, and does not have the infrastructure or capacity to do so now.

Did you know?

Venus is the only planet in the Solar System that spins clockwise on its axis.

Parliamentary highlights

TODAY

House of Commons 

In recess until 5th September

House of Lords 

In recess until 5th September

Scottish Parliament

In recess until 5th September