World News: 13:02 GMT Wednesday 11th September 2019. [Yahoo Business News Feed via SPi World News]
Hong Kong Exchanges and Clearing floats plan that would combine companies to create “global market infrastructure leader” Announcement follows LSE agreement to buy data giant Refinitiv — HKEX says that deal must be called off FTSE 100 advances at open as investors as Brexit turbulence calms Apple launches price war on Netflix as it unveils cheaper iPhone 11 Jeremy Warner: Is Christine Lagarde capable of the change necessary to save the eurozone? 1:02PM Quilter: Political risk makes LSE deal look shaky More on the LSE takover bid, with shares in group up a mere 5pc currently. Will Howlett, an analyst at Quilter Cheviot says: There is a long history of consolidation in the market infrastructure space reflecting the ability to extract significant cost synergies on businesses which are inherently scalable. The market infrastructure industry is attractive, reflecting natural monopolies, significant barriers to entry, strong cash generation and high returns on capital. Lower for longer interest rates as well as the collapse in the value of sterling also help with the financing of such deals. The shares are currently trading c. 15pc below HKEX’s proposed bid and we believe this reflects the real risk that politics would disrupt this deal, with the UK ‘losing’ an industry leader, particularly at a time when Brexit may elevate such sensitivities. Large scale cross border M&A; has a patchy track record. For example, we believe the unravelling of the LSE and Deutsche Boerse’s merger reflected the influence of politicians particularly following the EU referendum result in June 2016. 12:47PM Things appear to be winding down over at Sports Direct... But not before I suggested to him maybe it was time for him to sit down with the media to come to an understanding on how best to work together. Heavy media (and police/security) presence remains outside. I won’t hold my breath on him taking my suggestion...— Simon Neville (@SimonNeville) September 11, 2019 We’ll have a full report later: as a reminder, shareholder rebellion is almost pointless because Mike Ashley controls the major of the retail group’s shares. 12:40PM Ben Marlow on the LSE bid: ‘the Government should be crawling all over this proposal’ Hong Kong has been wracked by protests in recent months Credit: ROMAN PILIPEY/EPA-EFE/REX The Telegraph’s Chief City Commentator Ben Marlow has weighed in on HKEX’s bid for London Stock Exchange Group. He writes: ...you don’t have to look hard to see who is pulling the strings at the Hong Kong stock exchange. Chairman Laura Cha is appointed by Carrie Lam, the chief executive of Hong Kong, who has repeatedly faced charges that she is a puppet of Beijing, accusations that have grown louder amid the increasingly violent crackdown on student protesters. The exchange’s boss Charles Li claimed on a conference call with journalists that its seven-year ownership of the London Metal Exchange, during which it had invested in the UK, created jobs, and paid taxes, was proof that it would be a suitable custodian of the City’s crown jewels. No offence to Mr Li, but the LME isn’t in the same league as the LSE. You can read his full thoughts here: Hong Kong’s bid for the London Stock Exchange will be the biggest test yet for post-Brexit Britain 12:31PM Round-up: Stobart chair lands Crest Nicholson job, son loses court battle over £1m inheritance, outrage over UK iPhone costs Some are suggesting that the price of the iPhone 11 Pro in the UK is a reflection of the 'Brexit pound' Credit: JOSH EDELSON/AFP A veritable and varied smorgasbord of stories today, from across the Business, Money and Tech desks: Stobart chair Iain Ferguson lands job at Crest Nicholson: Stobart chair Iain Ferguson has been appointed as non-executive chairman of housebuilding company Crest Nicholson, completing an overhaul of the housebuilder’s top two jobs. ‘Controlling’ son loses High Court battle over £1m inheritance: The “controlling and manipulative” son of a former nurse has “pointlessly” eroded his inheritance to next to nothing in a failed three-year legal battle with his siblings to challenge his mother’s will and secure a larger cut of her £1m estate. Outrage after Apple ‘unfairly’ demands UK users pay more for the iPhone 11: British consumers have expressed their fury at a price hike on the latest iPhone 11 that means they’re left out of pocket compared to their US counterparts. The pound is up slightly against the euro, but flat against the dollar. Here’s how European stocks stand: Credit: Bloomberg TV 12:18PM Look ahead: Can John Lewis turn its fortunes around? The John Lewis store on Oxford Street, London Credit: Kirsty O’Connor/PA Tomorrow, John Lewis and Waitrose (and their respective Partners, presumably) will report on their half-year numbers. As Laura Onita reports, they aren’t likely to look super healthy. She writes: If you’re curious about the fate of John Lewis and Waitrose, it’s not good news. This time last year the partnership, which owns both businesses, admitted its profits were virtually zero. On Thursday it will likely say it is hemorrhaging cash when it updates the City on its half year numbers. The department store is stubbornly holding on to its “never knowingly undersold” price pledge, which is at the heart of its problems. Because of it, John Lewis has to follow where distressed rivals such as House of Fraser and Debenhams go with their discount bonanza. You can read her full report here: Can John Lewis struggle through the retail storm battering the UK high street? Meanwhile, speaking of the high street, here’s more from Mike Ashley... That would be the £3,000 customised Nike trainers or the £2,490 Balmain dress. Another potential faux pas from Ashley but I don't think SD investors are Flannels target audience. https://t.co/tgmqpZwziF— Ashley Armstrong (@AArmstrong_says) September 11, 2019 12:04PM Trump calls for flat or negative interest rates US President Donald Trump has slammed the Federal Reserve once again, accusing chair Jerome Powell of being naive and demanding there be “No Inflation!”. ....The USA should always be paying the the lowest rate. No Inflation! It is only the naïveté of Jay Powell and the Federal Reserve that doesn’t allow us to do what other countries are already doing. A once in a lifetime opportunity that we are missing because of “Boneheads.”— Donald J. Trump (@realDonaldTrump) September 11, 2019 Parsing through the usual economic bluster to that stunning use of diaeresis... Is a copy editor from The New Yorker editing Trump's tweets now? pic.twitter.com/Mgv6J4kYzC— Joe Weisenthal (@TheStalwart) September 11, 2019 11:56AM HKEX boss Charles Li: LSE deal would be a ‘corporate Romeo and Juliet story’ HKEX chief executive Charles Li Credit: Justin Chin/Bloomberg Charles Li, chief executive of the Hong Kong exchange group bidding for London Stock Exchange Group, has just held a press conference over the phone. Asked whether a Brexit-weakened sterling motivated the bid, he said: “you don’t choose timing, you choose what’s the right thing to do. The UK will continue to be the global financial centre.” Mr Li said the offer was a “vote of confidence in the UK today He also compared the deal to a “corporate Romeo and Juliet story”. As so often is the case, the profoundly negative implications of comparing a relationship to Romeo and Juliet have been disregarded in the pursuit of easy metaphor. Economic Intelligence newsletter SUBSCRIBER (article) Markets.com’s Neil Wilson has called the deal a “non-starter”. He writes: It’s a bold move and one that appears to have a low chance of success. Given the long and ignoble history of bids for LSE we think there is a very high bar to clear in order for this to succeed. Whilst HKEX already has a foothold in the UK via its ownership of the LME, the LSE is a different ball game entirely. Political considerations will be front and centre. The UK government may not wish to see such a vital symbol of UK financial services strength, and indeed a strategic asset, to be owned by foreigners; effectively it would hand it over to the Chinese through the Hong Kong back door. For the time being at least the EU also has a say in this. The US will also be eyeing this very, very closely indeed and not liking much at all. Nut and bolts — there’s not a mammoth premium here and do you as a LSE shareholder now fancy ditching your LSE stock in favour of a Hong Kong listed share (just 41pc of the new company to boot) which at any moment could be appropriated by Beijing should they so desire? No thanks. Secondly, LSE is all-in on the Refinitiv deal so why would they pull out now for such a gamble? It doesn’t make sense. I guess the question now is whether this approach forces others to join the party and spark a bidding war. Not everyone is so warm to the Refinitiv deal as the stock price adjustment suggests — a better premium from say a (US) rival could look appealing to shareholders. In that sense this looks like a last-ditch throw of the dice: It’s last orders for LSE bids as it works on its deal to absorb Refinitiv. This £22bn deal will make the LSE a powerhouse in financial trading and data, and it’s probably going to become too large for rivals like HKEX to swallow as a result. 11:42AM It looks like we might be waiting a bit longer for those Sports Direct results... ...as the meeting is still in full flow. Pity the hard-working journalists stuck outside. One shareholder asks for a presentation at next year’s AGM. Mike says it’s not needed “we do full year results and half year results”. Richard Bottomley disagrees and says it’s a valid point raised.— Simon Neville (@SimonNeville) September 11, 2019 11:37AM Full report: Hong Kong exchange puts Refinitiv deal on chopping block as it swings for LSE City workers making phone calls outside the London Stock Exchange (photo from 2008) Credit: TOBY MELVILLE/Reuters And here’s Harriet Russell’s full report on the HKEX/LSE takeover story has rather shaken things up this morning. She writes: The Hong Kong stock exchange has tabled an audacious £30bn bid for the London Stock Exchange that has sent shockwaves through financial markets, and could pose a political headache for the Government. The deal would thwart LSE Group’s £22bn mega deal to buy data business Refinitiv, which was unveiled earlier this year. If completed, the deal would be the largest in HKEX's history. It bought the London Metal Exchange for £1.4bn in 2012. You can read it all here: Hong Kong exchange looks to smash up LSE’s Refinitiv deal with surprise swoop 11:28AM Sterling unmoved despite prorogation ruling Glancing briefly into the maelstrom that is live political coverage of a Scottish court’s decision to rule Parliament’s suspension unlawful, it seems as though confusion is still reigning: Activists who brought the case, including @JolyonMaugham, say they lodged it in the Scottish courts as England's High Court wasn't sitting in August.— Tom Newton Dunn (@tnewtondunn) September 11, 2019 No 10 spokesman distances himself from this alleged remark: "The legal activists choose the Scottish Courts for a reason". [They are keen to avoid a politicising the judges row] Says it will all be decided in Supreme Court next week— Sam Coates Sky (@SamCoatesSky) September 11, 2019 Here’s the key bit of the Scottish court ruling: pic.twitter.com/3ttxs4kDPs— Kate McCann (@KateEMcCann) September 11, 2019 The news has had little impact on sterling so far. That’s potentially because even if the ruling is carried though and Parliament is recalled, it doesn’t make a lot of practical difference: Boris Johnson’s bid for a General Election has been quashed for now, and only actual Brexit developments are likely to shape the mood on the markets. 11:21AM Ashley’s audit headache Sports Direct is owned by billionaire Mike Ashley Credit: Leonhard Foeger/REUTERS For those readers who don’t passionately keep up-to-date with the audit market, here is a quick summary of the Sports Direct bean-counter imbroglio, via Harriet Russell: The retail chain, founded by billionaire Mike Ashley, is scrambling to avoid a possible suspension of its shares from the London Stock Exchange if it fails to find a new adviser. The company has tapped a number of ‘mid-tier’ firms about a possible tender process, after the Big Four accountancy firms PwC, Deloitte, KPMG and EY were understood to have turned down the work. Mazars and MHA MacIntyre were both said to have taken part in recent conversations with the company. Read more: Sports Direct taps smaller firms for help in race to find an auditor 11:16AM Sparks fly over lack of dividend payouts at Sports Direct AGM Inside Sports Direct’s annual general meeting, things are getting heated over the company’s lack of payouts to investors. Getting feisty. Shareholder responds: “10 years you haven’t paid a dividend. It’s a disgrace. I shan’t be voting for the re-election of the Directors who don’t own shares.”— Simon Neville (@SimonNeville) September 11, 2019 On the topic of auditors, it looks like there is not much movement: Only line on auditors “we are in the middle of a process. We’ll share the outcome.” Asked whether SD will have an auditor after today, the board won’t answer. “Grant Thornton have not stood for re-election”— Simon Neville (@SimonNeville) September 11, 2019 As a reminder, journalists are banned from the meeting. So if you’re wondering how Simon Neville, City Editor of the Press Association, wrangled a place: Companies don't have to let journalists in - but by tradition do. Sports Direct have said no, luckily Simon owns one share— Richard Fletcher (@fletcherr) September 11, 2019 11:00AM Quick wrap: Surprise bid jolts LSE shares The central atrium of the London Stock Exchange (photo from 2016) Credit: LEON NEAL/AFP Hong Kong Exchanges and Clearing (HKEX) has tabled a shock £29.6bn offer for the London Stock Exchange Group, which operates Britain’s best-known bourses. Here are the key points so far: HKEX believes the merger would create a “global market infrastructure leader” The offer would be contingent on LSE dropping its plans to merge with data giant Refinitiv The offer values LSE at £83.61 a share — a 22.9pc premium on Tuesday’s closing price — representing a deal value of £29.6bn, and enterprise value of £31.6bn HKEX will make a secondary listing on the LSE if the deal goes ahead LSE says it will “consider” the proposal and then respond, but insisted it remains committed to merging with Refinitiv Both companies have been involved in major merger activity in recent years Business Secretary Andrea Leadsom said the UK would “look very carefully” at anything about the deal that had security implications for the UK LSE shares initially surged to an all-time high, but have now settled around 6pc up. 10:47AM LSE will make announcement ‘in due course’ David Schwimmer (centre), chief executive of LSE Group Credit: Luke MacGregor/ Bloomberg London Stock Exchange Group has offered its response (essentially saying it intends to respond later, and is still planning to press ahead with its Refinitiv merger). It says: The Board of London Stock Exchange Group plc (“LSEG”) notes the announcement from Hong Kong Exchanges and Clearing Limited (“HKEX”) and confirms that HKEX has made an unsolicited, preliminary and highly conditional proposal to acquire the entire share capital of LSEG (the “Proposal”). The Board of LSEG will consider this Proposal and will make a further announcement in due course. LSEG remains committed to and continues to make good progress on its proposed acquisition of Refinitiv Holdings Ltd as announced on 1 August 2019. A circular is expected to be posted to LSEG shareholders in November 2019 to seek their approval of the transaction. 10:41AM New Look cuts losses as restructuring continues Like-for-like sales, which exclude shops opened this year, tumbled 10pc for the three months to the end of June at New Look Credit: Handout Elsewhere in the world of retail this morning, New Look posted a mixed set of results which included lower losses, but also a slump in sales and revenue. Retail correspondent Laura Onita reports: The struggling fashion chain, which has almost 500 UK stores, blamed the weather from keeping shoppers away from its stores as well as a general sentiment of uncertainty, which means customers have been spending less on clothes and shoes. Like-for-like sales, which exclude shops opened this year, tumbled 10pc for the three months to the end of June, although they recently turned positive, the company said, trading up 2.2pc. Losses narrowed to £2.7m from £15.5m this time last year while revenues slumped to £258m from £300m a year ago. You can read her full report here: New Look vows to ‘attack the future’ as sales slump continues 10:37AM Meanwhile, over at Sports Direct... Sports Direct AGM. I’m in. Waiting to start... kicks off 11am. My esteemed colleagues are locked out pic.twitter.com/o6y8WMATZf— Simon Neville (@SimonNeville) September 11, 2019 We’ll find out more about exactly what goes down at the meeting after 11am (assuming the company can stick to its timetable this time). 10:34AM LSE: A biddable company... London Stock Exchange's tumultuous history of bids ...as a quick reminder of just how many takeover offers the LSE has recieved, my colleagues Harriet Russell and Vinjeru Mkandawire wrote in August: Some City analysts reckon LSE has been subject to a takeover or merger approach, on average, every two and a half years since floating in 2000 from “at least” five separate companies, including the ICE. Given the current strength of businesses such as clearing house LCH and FTSE Russell, analysts believe there’s a “one-in-three” chance a separate bid will emerge for LSE as a standalone company, before it becomes too large to buy. Their full piece (which is a must-read to understand the wider context of this deal) can be read here: David vs Goliath: London Stock Exchange’s $27bn swoop on Refinitiv pits it against Bloomberg LSE shares have shed some of their initial gains, and are now up just over 6pc. They hit an all-time high earlier, but are now a little lower than where they stood last week, after some selling-off on Tuesday. It's not a company I play close attention to, so hadn't realised just how good an investment London Stock Exchange had been. It's up 900% over the last 10yrs. pic.twitter.com/i4C2M6YNYq— Mike Bird (@Birdyword) September 11, 2019 10:25AM Ben Wright: Takeover offer is ‘fighting the weight of history’ The have been numerous bids for the LSE in recent years Credit: Chris J Ratcliffe/Getty Images Europe Telegraph Business Editor Ben Wright has offered his snap take on HKEX’s audacious grab for the LSE: Few companies have as many stakeholders as a stock exchange. All will want a say. Few will agree. HKEX is fighting the weight of history. I don’t have enough fingers to count the number of failed takeovers of, and mergers involving, the LSE down the years. The LSE has only just agreed a $27bn merger with data group Refinitiv, making it one of the largest financial and trading data companies in the world. It's going to want time to swallow and digest that deal before moving on to another monster transaction. Few companies can really be described as “strategic”. But there’s a good argument that stock exchanges are. That means that politicians are going to want to get involved. Is the British government prepared to have a strategic financial asset effectively owned by the Chinese? Even if was prepared to have a strategic financial asset effectively owned by the Chinese, is it comfortably with a deal happening now, as protests in Hong Kong reach fever pitch? The UK is currently still a member of the European Union. The LSE is therefore also a strategic European financial assets and Brussels is likely to get involved. It is not hard to imagine Donald Trump demanding that the UK blocks the takeover as a precondition to any future US-UK free trade agreement. Have to agree with @_BenWright_ this looks far-fetched. Stranger things happen, but the hurdles seem clear and plenty.— Harriet Russell (@harrietrussell) September 11, 2019 10:20AM LSE caught unaware by HKEX announcement Snapping back to London, Harriett Russell has the latest on HKEX’s shock-and-awe offer for the London Stock Exchange Group, who were caught off-guard by announcement. She reports: It’s a decline to comment from the LSE with sources telling me the exchange was unaware of Hong Kong’s planned announcement. 10:18AM Also breaking: Scottish court rules prorogation of Parliament is unlawful It’s all kicking off now. Over in Scotland, an appeals court has ruled Boris Johnson’s suspension of parliament is unlawful. Implementation will not occur until the UK Supreme Court makes a ruling on the issue next week. The Government will appeal the ruling. Get the latest here: Brexit latest news: Scottish court rules Boris Johnson broke law by proroguing Parliament 10:15AM LSE would have to drop Refinitiv offer for deal to pass A crucial part of HKEX’s announcement is its demand that LSE withdraws plans to merge with data giant Refinitiv. The planned LSE/Refinitiv merger would place the company in competition with Bloomberg in the lucrative financial data space. Read more: David vs Goliath: London Stock Exchange’s $27bn swoop on Refinitiv pits it against Bloomberg HKEX says: The Proposed Transaction, whether implemented by way of a scheme of arrangement or takeover offer, would be subject to, amongst other things: a resolution in respect of the approval of the Refinitiv transaction having been voted on and not approved by the LSEG shareholders; or the Refinitiv transaction being terminated, lapsing, being withdrawn or not proceeding for any other reason; in each case by 31 December 2019 or such later date as HKEX may determine; My colleague Harriet Russell reports: Sources in Hong Kong said the deal had been in the works for a number of months but was “catalysed” by LSE’s Refinitiv announcement last month. The deal is only expected to proceed if LSE takes the Refinitiv deal off the table altogether. In August, City analysts said they would not be surprised to see the LSE receive takeover offers of its own in the wake of the Refinitiv announcement as potential suitors looked to snap up the London-based exchange before it got “too big to buy” 10:10AM Merger would ‘redefine global capital markets for decades to come’ Charles Li, HKEX boss Credit: Bobby Yip/ REUTERS Charles Li, HKEX’s chief executive said: Bringing HKEX and LSEG together will redefine global capital markets for decades to come. Both businesses have great brands, financial strength and proven growth track records. Together, we will connect East and West, be more diversified and we will be able to offer customers greater innovation, risk management and trading opportunities. A combined group will be strongly placed to benefit from the dynamic and evolving macroeconomic landscape, whilst enhancing the long-term resilience and relevance of London and Hong Kong as global financial centres. 10:05AM HKEX’s proposal All the noise we have on this is from the Hong Kong Exchanges and Clearing side. They say the proposal would: Create a world-leading market infrastructure group with a global footprint, diversified across asset class, ideally positioned to benefit from the evolving global macroeconomic landscape, connecting the established financial markets in the West with the emerging financial markets in the East, particularly in China; Elevate the UK’s role in capturing the significant growth opportunities presented by Mainland China's continuing internationalisation and the emergence of RMB as a global reserve currency, securing London’s position as the global centre for both Eurodollar and offshore RMB; Reinforce Hong Kong’s position as the key connection between Mainland China, Asia and the rest of the world, providing a trusted and clear path for the continued opening up of Mainland China's capital markets and for the investment of Asia's growing wealth; Enable the creation of unique and valuable data sets for global investors, through the combination of LSEG's global data and analytics capabilities and distribution channels, and HKEX’s access to China, the world’s most digitalised growth economy; Enhance global capital formation by making it easier for companies to access equity capital across the world, through the IPO and secondary fundraising markets in London, Hong Kong, Milan, and Mainland China via the Connect programmes; and Offer innovation opportunities in equities, fixed income, currencies, commodities and derivatives products with domestic, regional and global relevance; allow for the application of best-in-class technologies in multiple markets and platforms; and help strengthen transparency, resiliency and risk capabilities in both London and Hong Kong. Snap reaction: not going to happen. https://t.co/s1ahqX9RZo— Ben Wright (@_BenWright_) September 11, 2019 A London Stock Exchange - Hong Kong Exchanges merger would be a bold move. One of course is at the heart of an ageing financial centre struggling with a larger and more powerful neighbor, in a moment of acute political crisis, and the other is Hong Kong.— Mike Bird (@Birdyword) September 11, 2019 9:54AM NEW: Hong Kong Exchanges and Clearing tables £30bn bid for London Stock Exchange Group Financial market figures are shown on big screens and a ticker in the main entrance at London Stock Exchange Credit: Chris J Ratcliffe/Getty Images Europe Just weeks after London Stock Exchange announced its acquisition of data business Refinitiv, Hong Kong Exchanges and Clearing Limited (HKEX), which operates the stock market and futures market in Hong Kong, has thrown its hat in the ring to snap up the LSE, in a deal which could be worth close to £30bn (Harriet Russell writes). HKEX intends to apply for a secondary listing of its shares on the LSE, should the deal complete, which it said demonstrated its “commitment to the UK”. In August, LSE agreed to buy financial information provider Refinitiv in a $27bn (£22bn) deal aimed, to establish itself as a credible rival to Bloomberg. Business Secretary Andrea Leadsom happened to be on Bloomberg TV as the news broke. She said the UK welcomes foreign investment but would “look very carefully at anything that had security implications for the UK”. HKEX said: LSEG and HKEX are two of the world's premier market infrastructure businesses, which together would offer unique potential to enhance and capture global capital and data flows. The proposed combination would strengthen both businesses, better position them to innovate across markets and geographies, and offer market participants and investors unprecedented global market connectivity. LSE shares have surged by nearly 9pc on the new: 9:46AM Sports Direct prepares for annual general meeting. Not on the invite list: journalists Mike Ashley, owner of Sports Direct Credit: Kirsty O'Connor/PA Today will mark another twist in the saga of Sports Direct — one that has recently included investors being left in the lurch by repeated delay to the retailer’s market update. Journalists have been banned from the event, so it is likely we won’t hear what occurs at the gathering of shareholders until after 11am. Just been told Sports Direct is banning all media from its AGM tomorrow. Never a good look when a company shuts out journalists. What happened to its “very open” promise in 2016? Mind you “very prudent” and “very compliant” also in question... pic.twitter.com/1ebagZTIN0— Ashley Armstrong (@AArmstrong_says) September 10, 2019 Boss Mike Ashley is facing calls to step down following the company’s update fiasco during the summer, which culminated in its revealing it had been hit by a £605m tax bill by Belgian authorities. It’s also on the hunt ofr a new auditor, as it struggles to find a bean-counter willing to take on its increasingly-complicated accounts. Section 490 which says where an auditor is not appointed the Secretary of State (at BEIS) may appoint one, and determine remuneration. Also the company must let the SoS know within a week that the power is exercisable. Otherwise both the company and its officers commit an offence— PIRC (@PIRC_news) September 11, 2019 The company structure has grown ever-more byzantine in recent years, as Mr Ashley buys up more and more high street brands. Mike Ashley's business empire Here’s a reminder of how things went down during its delay saga in July: Sports Direct results delays Telegraph Chief City Commentator Ben Marlow has weighed in on the saga today, comparing Sports Direct with rival JD sports — which is having a rather better time. He writes: While the burly billionaire continues his bizarre obsession with snapping up failing rivals and struggling brands, JD Sports has cornered the booming market for fashionable athletic clothing. The fortunes of the two high street sports chains couldn’t be more different. In the last five years, shares in Ashley’s empire have slumped two-thirds amid fears that a company once feted by the City is beginning to unravel. You can read his full thoughts here: JD Sports leaves Mike Ashley floundering in high street fashion race 9:15AM Oil steadies after Bolton ouster relieves pressure on producers Mr Bolton was known as a supreme hawk Credit: Cliff Owen/AP The sudden ouster of John Bolton — the latest national security advisor to lose a spot in the White House — had a fairly sharp initial impact on the price on oil yesterday. The exit Mr Bolton, known for his hawkish foreign policy stance, relieved fears over an escalation in US hostilities towards oil producers Iran and Venezuela. Donald Trump ‘fires’ national security adviser John Bolton over policy disagreements Mr Bolton, who was hired by Donald Trump after the President was impressed by his television performances. Reporting suggests he fell out with the commander-in-chief after Mr Trump was left frustrated by the US’s failed attempt to bring about regime change in Venezuela. As for exactly how Mr Bolton was ousted, here’s what the two men say: ....I asked John for his resignation, which was given to me this morning. I thank John very much for his service. I will be naming a new National Security Advisor next week.— Donald J. Trump (@realDonaldTrump) September 10, 2019 I offered to resign last night and President Trump said, "Let's talk about it tomorrow."— John Bolton (@AmbJohnBolton) September 10, 2019 Ousted | The ‘no men’ who Trump has let go 9:03AM Sorrell’s S4 Capital aims to double in size by end of 2021, swings to loss as acquisitions continue Sir Martin formed S4 Capital after leaving ad giant WPP Credit: Jason Alden/Bloomberg Sir Martin Sorrell’s S4 Capital said it remains on track to double in size by 2021 in half-year results today, even as a spending spree pushed it to a loss. The marketing group made a £8.5m pre-tax loss for the six month to June, which registered as a profit if adjusted for one-off costs. The company, with Sir Martin formed after leaving ad giant WPP under a cloud, has been on a spending spree as it seeks to expand further into programmatic advertising. Sorrell’s new venture aims to win big clients as revenues jump Inside story - The day it all ended for WPP's Sir Martin Sorrell Its client list has expanded to include several major advertisers, including Coca-Cola, Nestle and Proctor & Gamble. Sir Martin said (in comments directed at investors): These results confirm the power and relevance of the faster, better, cheaper, digital-only unitary advertising model, with first party data fuelling content and programmatic. Now the task is to build significant scale organically, by broadening and deepening existing and new client relationships and adding resources through merger and acquisition. Your company is being increasingly involved in significant industry reviews. 8:45AM Competition watchdog to assess Union plans to buy student digs rival The Competition & Markets Authority has announced it is evaluating the anticipating takeover by Unite Group, which build and maintains student accommodation, of rival Liberty Living Group. The watchdog said it “is considering whether it is or may be the case that this transaction, if carried into effect, will result in the creation of a relevant merger situation... and, if so, whether the creation of that situation may be expected to result in a substantial lessening of competition”. Business Briefing Newsletter REFERRAL (Article) Unite released a statement and trading update this morning to coincide with the announcement. It said it had experienced “a strong lettings performance” over the summer, putting revenues around 40pc than in 2018. “As such, we remain confident in delivering rental growth of 3.0–3.5pc for 2019/20 and 2020/21, including improved utilisation,” the company said. Richard Smith, Unite’s chief executive, said: Demand for UK Higher Education remains robust, as reflected in the record share of 18-year olds choosing to attend University. Student demand also supports our strategic alignment to mid and higher tariff Universities. Despite increased political and economic uncertainty, we maintain our positive outlook for the business 8:33AM Galliford Try announces profit drop amid Bovis takeover talk Galliford’s housebuilding unit saw a slightly fall in units Credit: Chris Ratcliffe/Bloomberg Galliford Try was a FTSE 250 darling yesterday, with its shares soaring after peer Bovis Homes announced it was restarting a takeover bid for the housebuilder. Today, Galliford posted full-year results, which show its profit slipped over the year to June. My colleague Laura Onita reports: Profits fell to £104.7m from £143.7m for the year to the end of June, while revenues edged down from £2.9bn to £2.7bn. The FTSE 250 construction firm had to foot another £26m bill to complete the Aberdeen Western Peripheral Route, which has now been finalised, as well as other one-off charges worth £24m. Stripping these out, pre-tax profit was in line with expectations at £155.5m, down from £188.7m last year. Its housebuilding arm, which will merged with that of Bovis in a £1bn deal if all goes to plan, built 6,057 new homes, a slight fall on the year before. You can read her full report here: Aberdeen bypass costs take a chunk out of Galliford Try profits The results have shaved just more than a percentage point off Galliford’s shares so far today. 8:11AM European stocks climb at open Equities markets across Europe have opened to the upside, with Germany’s DAX leading risers. Credit: Bloomberg TV Top stock indices across the continent had closed broadly positive on Tuesday, with a late rally shaking off what had been a flat morning. 7:42AM What happened overnight Bond yields climbed and stock markets held steady on Wednesday, as hopes of easing US-China tensions and diminished risk of a no-deal Brexit prompted traders to take profit before key central bank meetings, Reuters reports. Oil prices also firmed, underpinned by a big drop in US crude stockpiles, after slipping the previous day. MSCIs broadest index of Asia-Pacific shares outside Japan rose 0.4pc to hit a fresh 5-1/2-week high. Investors around the world continued to rotate into value stocks, representing a major reversal after many months of outperformance by growth shares such as tech companies. Japan's Nikkei average climbed 0.9pc, with the Topix Value index jumping 1.9pc whereas the Topix Growth added 0.8pc. The Shanghai Composite and the blue-chip CSI300 fell in afternoon trade, while Hong Kong's Hang Seng advanced 1.6pc. 7:41AM Agenda: Markets await Draghi WIll Mario Draghi leave with a bang? Credit: RALPH ORLOWSKI/REUTERS Good morning. European stocks closed higher yesterday after a late rally while the pound strengthened against both the dollar and the euro. Today is likely to see stimulus fever crank up as investors look ahead to the European Central Bank’s meeting tomorrow. It’s a quieter day on the corporate and economic fronts for the UK. 5 things to start your day 1) Shops are shutting at a rate of up to 16 a day across the country, with closures hitting record levels as the crisis engulfing the high street escalates. The first half of this year saw 2,868 store closures, almost twice as many as openings, as retailers increasingly resort to controversial rescue deals to cut rents and shut unprofitable stores. 2) Has ECB boss Mario Draghi got anything left in his box of tricks? Running any central bank is hard enough, but spare a thought for European Central Bank president Mario Draghi. The Italian, who steps into the spotlight tomorrow for almost the final time, took the job on in the teeth of an existential Eurozone debt crisis in 2011. Mario Draghi's efforts to kick-start lending 3) A wildly swinging pound is trading like an emerging market currency as the next Brexit deadline looms, Bank of England Governor Mark Carney has warned. The extreme volatility in sterling is more in line with the performance of currencies in developing economies while the pound has now “decoupled” from its peers in other advanced countries “for obvious reasons”, Mr Carney said at an event in New York. 4) Brexit 'train crash' warning from Vauxhall boss Tavares at Frankfurt motor show: Mr Tavares said it was like “sending two trains to crash at full speed into each other just to demonstrate the strength of your muscles. [It] doesn't seem to be the best approach." Frankfurt Motor Show 2019 | Read more 5) Honest Burger has shrugged off Britain’s casual dining crunch by not simply turning a profit, but growing its bottom line. Sales at the burger chain rose by more than a third to £31m, with pre-tax profit a fifth higher at £873,000 in the year to January, according to Companies House filings. Coming up today Interim results: AMS, Chemring, S4 Capital Full-year: Galliford Try Trading statement: Biffa Economics: Mortgage applications, producer price index (US)
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