- European stocks fall as cases rise in Beijing and America
- Bank of England monetary policy decision at 12pm
- Tesco exits Polish business
- Safestore jumps after resilient performance
- FCA to make min-bond selling ban permanent
- Big business builds its own apps to get staff back into offices
- Ambrose Evans-Pritchard: Slavery, colonialism, the industrial revolution - and why Britain became rich
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Pound extends fall against dollar
The pound is falling against the dollar for a third day today ahead of the Bank of England’s latest monetary policy decision.
MUFG currency strategist Lee Hardman said:
Risks are skewed to an even bigger expansion to help maintain support for the recovery for longer. Market attention though, will likely focus on other policy options such as the possibility of negative rates.
BoE: Today’s timings
C三级成人视频ovid-19 has prompted a bit of a shift in how the Bank of England’s monetary decisions come out. Here are today’s timings:
- 12pm: Monetary Policy Committee decision announced
- 1pm–2pm: Embargoed press briefing
- 2:30pm: Embargo ends, contents of briefing released
三级成人视频That mean there’ll be slightly less live content on the blog, but I’ll bring you the latest lines from our econ team as I get them. Elsewhere, we still have US jobless claims to keep things busy.
National Grid expects £400m hit from Covid-19
Energy provider National Grid has warned it expects to take a £400m operating profit hit in the current financial year as a result of Covid-19.
The group posted slightly worsened results for the 12 months to the end of March, with profit before tax down 5pc to £1.75bn. It put aside £117m as a provision for bad debts occuring in the US during the year.
Addressing the pandemic, it said:
三级成人视频As lockdown measures began to take hold towards the end of 2019/20, incremental costs due to COVID-19 were limited on the Group. However, the help we are giving our customers, and the additional costs that COVID-19 has brought, will lead to a financial impact for 2020/21. We currently estimate the impact of COVID-19 on underlying operating profit to be around £400 million, with a potential impact of up to £1 billion on cash flow by the end of this financial year.
三级成人视频National Grid said the additional costs come from higher IT costs, increased cleaning and measures to protect staff.
三级成人视频John Pettigrew, its chief executive, said:
Looking ahead, whilst Covid-19 will impact our financial performance in FY21, we expect this to be largely recoverable over future years and therefore anticipate no material economic impact on the group in the long-term.
三级成人视频Royal Bank of Canada’s John Musk said the results were slightly below consensus, but added:
三级成人视频We see any short-term disruption as a result of Covid-19 as unlikely to have a material impact on the long-term investment case
Safestore rises as analysts praise resilience
On the FTSE 250, shares in Safestore popped higher at the open following the group’s first-half results – which showed an 8.5pc rise in revenues and substantial rise in profits.
The group – the UK’s biggest provider of self-storage – said it had shown “resilient operational performance” despite Covid-19, with levels of enquiries returning to pre-lockdown levels and occupancy improving.
三级成人视频Frederic Vecchioli, its chief executive, said:
三级成人视频We believe the resilient characteristics of the self-storage industry, together with our leading market positions across the UK and Paris, place the business in a strong position to withstand the economic uncertainty arising from Covid-19.
Citi’s Aaron Guy said the results showed “arguably the most resilient performance in our coverage through the coronavirus affected period to date”, saying Safestore appears defensive, with an opportunity for growth, despite the pandemic.
Tesco sells Polish business
Shares in Tesco have risen after the group announced the sale of its Polish operations to Denmark’s Salling Group, with total net proceeds expected to be £165m.
三级成人视频Tesco Polska generated a small operating loss on sales of £1.4bn across 301 locations last year. Its stores will be rebranded over the coming 18 months as part of the transaction.
Dave Lewis, Tesco’s chief executive, said:
三级成人视频We have seen significant progress in our business in Central Europe, but continue to see market challenges in Poland. Today's announcement allows us to focus in the region on our business in Czech Republic, Hungary and Slovakia, where we have stronger market positions with good growth prospects and achieve margins, cashflows and returns which are accretive to the Group.
三级成人视频Jefferies’ James Grzinic said the sale is a “helpful one” that removes tesco’s only remaining “subscale” market. He added:
Today's announcement further underpins the expected capital return framework, which we believe is likely be announced at the 20/21 finals.
Mini-bond marketing ban to be made permanent, says FCA
The City watchdog plans to make permanent its ban on the mass-marketing of speculative illiquid securities – which including speculative mini-bonds – to retail investors.
三级成人视频The proposal, which follows a ban launched without consultation in January, comes amid a series of scandals involving mini-bonds, which the Financial Conduct Authority has said were being touted to retail investors without adequate information on the risks involved.
- Read more: Watchdog bans marketing LCF-style minibonds to everyday investors
- Risky minibonds still being touted to armchair investors post ban
As part of the change, the FCA will expand the scope of the ban to include listed bonds with similar features to speculative illiquid securities.
三级成人视频The FCA’s Sheldon Mills said:
We know that investing in these types of products can lead to unexpected and significant loses for investors. We have already taken a wide range of action in order to protect consumers and by making the ban permanent we aim to prevent people investing in complex, high risk products which are often designed to be hard to understand.
“Since we introduced the marketing ban we have seen evidence that firms are promoting other types of bonds which are not regularly traded to retail investors. We are very concerned about this and so we have proposed extending the scope of the ban.
Markets brace for BoE decision
It’s slightly quiet on the corporate front for a Thursday, but at least there is yet more economic news – this time around, it’s the latest monetary policy decision from the Bank of England.
I’ll do some build-up ahead of the announcement at 12pm (and subsequent press conference), but first up here’s an extract our Economic Editor Russell Lynch’s curtain-raiser from earlier this week:
Financial markets are braced for interest rates to drop to zero next year as the Bank of England prepares to pump yet more stimulus into an economy hammered by the lockdown.
The Bank’s Monetary Policy Committee already cut rates to an all-time low of 0.1pc during the early stages of the crisis in March. But overnight interest rate swap markets are signalling they could fall even further to zero by August next year, according to Nomura’s chief UK economist, George Buckley.
三级成人视频The potential blow to savers comes as rate-setters review radical tools such as negative rates for handling a crisis which span the economy into a record 20.4pc slump in April.
三级成人视频Economists expect the MPC to expand its bond-buying by at least £100bn at its latest meeting on Thursday, taking the overall size of its quantitative easing programme to £745bn – a third of the size of the UK economy.
Agenda: Stocks slip on virus concerns
Good morning. European stocks are set to slip at the open over fears of a second wave of infections.
三级成人视频Virus cases have jumped in US states that have reopened including Texas, Florida and Arizona, while Beijing's new outbreak exceeded 150 cases.
5 things to start your day
1) Big business builds its own apps to get staff back into offices: Institute of Directors says it is crucial that the wider public health response is "up to scratch" for the sake of smaller firms
2) The pensions triple lock needs urgent reform to stop distortions from coronavirus handing a pair of bumper payouts to retired households while the workers paying for it suffer, former pensions ministers have warned. State pension payouts rise by the highest of annual inflation, wage growth or 2.5pc.
3) Delivery firm DPD to create 6,000 jobs三级成人视频: The business needs 3,500 new drivers around the country as well as 2,500 full-time warehouse staff, managers, mechanics and other workers. It is investing £200m in expanding its next-day parcel delivery capacity, including spending £100m on vehicles.
4) Financial crisis looms for care homes: Long-running calls for reform of the sector are growing into a clamour due the coronavirus pandemic, which has ripped through homes, killing tens of thousands of residents and saddling managers with billions of pounds of extra costs.
5) More than 50 beer and pub businesses have written to Boris Johnson demanding a definitive reopening date三级成人视频 amid warnings that the industry risks losing “hundreds of thousands” of jobs.The letter, signed by businesses including Budweiser, Carlsberg, Greene King and Diageo, called on the Government to provide “urgent clarification”.
What happened overnight
Shares fell in Asia after another day of wobbly trading on Wall Street as markets eased off the accelerator following their big rally.
Japan's Nikkei 225 shed 0.3pc to 22,394.45 and the Hang Seng in Hong Kong also fell 0.3pc, to 24,407.59. South Korea's Kospi slipped 0.2pc to 2,137.69 and the Shanghai Composite index was 1 point higher at 2,936.88.
Sydney's S&P/ASX 200 skidded 1pc to 5,934.80 after the government reported that unemployment surpassed 7pc and would have been above 9pc if the figure included people laid off and not officially looking for work.
Coming up today
Interim results: Blue Prism, CareTech, Safestore
Full-year: 三级成人视频Hornby, National Grid
Economics:三级成人视频 Bank of England Monetary Policy Committee decision (UK), jobless claims (US), Norges Bank rates announcement (Norway)