8 January

Lyle Hill

8 January

Good morning,

 
Theresa May is expected to reshuffle her Cabinet today following months of speculation over the issue. The promotions and demotions will start later and are expected to run into Tuesday, with the big moves taking place first followed by the more junior ministerial positions tomorrow.

Mrs May has been in between a rock and a hard place with her Cabinet since she lost her parliamentary majority in June last year. The prime minister has been forced to walk a tightrope between Remain leaning colleagues and Leave supporting MPs. 

This job was only made more difficult by the sexual harassment scandal that engulfed Westminster as 2017 closed, leading to two of her most trusted ministers, Michael Fallon and Damien Green, being forced to resign.

But it seems like Theresa May has finally decided that a change is needed, perhaps signalling a new found confidence and security in her position as prime minister. 

It is expected that the new look Cabinet will include a number of new faces and that many of these will be women, with May using the opportunity to promote talented female MPs and restore some gender balance round the Cabinet table.

However, it is unlikely that we will see new faces in the most high profile roles. Philip Hammond, Amber Rudd, Boris Johnson and David Davis are all expected to remain in post following the reshuffle.

Instead, education secretary Justine Greening is expected to be moved, as the government seeks to reassert its credentials in education in the run up to local elections. Another controversial face that may be looking forward to a change of role is Jeremy Hunt, who may be moved from health, as Theresa May looks to divert attention from any winter crisis in the NHS.

If Hunt is moved, it would be an end to a long and often difficult relationship with the health brief, and it would come as part of the prime minister's attempt to reinvigorate a long and often difficult relationship with her own post. Only time will tell if it is a success.

 

NEWS

Carrie Gracie, the BBC's China editor, has quit the corporation after it emerged she was earning substantially less than her male equivalents. She becomes the first high profile woman to leave her post following the revelations of disparity in pay, and accused the BBC of pursuing not only discriminatory but illegal practices. 

The first awards show of the year, the Golden Globes, was held yesterday evening in Los Angeles. The ceremony was used by many of Hollywood's most famous faces to protest against sexual harassment following the scandal which engulfed the industry at the end of last year. Stars wore black and Oprah Winfrey, in her acceptance of a lifetime achievement award, said “I want all the girls watching here, now, to know that a new day is on the horizon”.

Parkinson's diagnosis is expected to rise by almost a fifth over the next seven years, as Britain's population continues to age. The disease currently affects 137,000 people, which represents an estimated increase of 10,000 over the past ten years. It is believed that if estimates are true, the cost of the disease on the NHS by 2025 will be over £1 billion a year.

 

BUSINESS AND ECONOMY

KPMG has quit the inquiry into the Grenfell tower disaster following controversy over the firm's appointment. The accountancy firm was accused of failing to disclose a conflict of interest in the case, as it acts as the auditor for Kensington and Chelsea Council, as well as Rydon Construction, which refurbished the tower in 2015, and Celotex, which manufactured insulation material used in the tower.

Consumer spending in the UK has fallen for the fourth straight month. December saw a one percent fall in household spending, rounding off a lean year for retailers. In recent days, companies such as Debenhams and House of Fraser have announced difficult periods in trading due to falling sales and consumer spending trends.

Airbus is attempting to woo China into purchasing a number of $440 million A380 planes, in return for Chinese companies helping to build part of the machines. Airbus's flagship plane has not had any new orders in two years and is in danger of being killed off if the Chinese do not place any orders. Airbus representatives will travel with Emmanuel Macron to China this week.

 

MARKETS

The week ahead

The week kicks off with President Emmanuel Macron travelling to China for a two day trade trip. He will be joined by representatives from Airbus, who will seek to win over Chinese representatives and secure orders for their A380 flagship planes.

Mr Macron is expected to push for changed trade regulations, as France has long believed it's trading relationship with China is unfair. This is due to the strict rules China has on foreign investment, requiring technology transfers and compulsory joint ventures.

On Tuesday, long awaited dialogue will take place between North Korea and South Korea over the North's proposed participation in the Winter Olympics. The two countries have not spoken directly in over two years and it is hoped these talks will lead to a detente in the relationship.

Finally, this week represents a big week for supermarkets, who will report a number of results. Morrisons will get the ball rolling on Tuesday, with Sainsbury's and Tesco following suit on Wednesday and Thursday respectively. It is expected that all three will report and increase in like-for-like sales.

Interims
Micro Focus International

UK Economic Announcements
(08:30) Halifax House Price Index

International Economic Announcements
(07:00) Factory Orders (GER)
(10:00) Consumer Confidence (EU)
(10:00) Retail Sales (EU)

 

 

COLUMNS OF NOTE

In the Financial Times Big ReadNicole Bullock and Robin Wigglesworth take an in depth look at the US IPO prospects for 2018. They argue that greater access to capital has seen companies stay private for longer, but that this year we may see a change.

Katherine Griffiths, writing in The Times, examines the race to be the next chief of the Bank of England. She believes that Andrew Bailey, head of the FCA, remains the front-runner for the job, but may be nervous he is overlooked for an outsider candidate. 

 

PARLIAMENTARY HIGHLIGHTS

TODAY

House of Commons
Oral questions
Home Office (including Topical Questions)

Legislation
Taxation (Cross-Border Trade) Bill - 2nd Reading
 
House of Lords
Oral questions
Reporting to Parliament on Brexit - Lord Spicer
Establishing an independent environmental enforcement agency before the UK leaves the EU - Baroness Jones of Moulsecoomb
Arrangements for supporting child refugees following the UK's withdrawal from the EU - Lord Roberts of Llandudno

Debate
Government’s Industrial Strategy and the case for boosting earning power and productivity across the UK with investment in the skills, businesses and infrastructure of the future - Lord Henley

Scottish Parliament
No business scheduled.


TOMORROW

House of Commons

Oral questions
Foreign and Commonwealth Office (including Topical Questions)

Legislation
Trade Bill - 2nd reading

House of Lords
Oral questions
Equalising statutory pay received for shared parental leave by people of any gender - Baroness Burt of Solihull
How many families were homeless over Christmas 2017 - Lord Kennedy of Southwark
Decision of the government of China to restrict the imports of foreign waste - Lord Teverson

Scottish Parliament
Culture, Tourism, Europe and External Relations Committee Debate
Article 50 Withdrawal Negotiations

Members' Business
Maintenance of Tenement Communal Property