Deliveroo’s orders double in first quarter after dismal IPO

(qlmbusinessnews.com via uk.reuters.com — Thur, 15th April 2021) London, UK —

LONDON (Reuters) -Food delivery company Deliveroo said its orders more than doubled in the quarter to end-March in its first trading update since its highly-anticipated listing in London last month flopped.

Growth accelerated for the fourth consecutive quarter, the company said, with group orders up 114% year-on-year to 71 million and gross transaction value (GTV) up 130% year-on-year to 1.65 billion pounds ($2.27 billion).

Chief Executive Will Shu said demand was strong in both UK and Ireland and its international markets, driven by record new customer growth and sustained demand from existing customers.

“This is our fourth consecutive quarter of accelerating growth, but we are mindful of the uncertain impact of the lifting of COVID-19 restrictions,” he said on Thursday.

“So while we are confident that our value proposition will continue to attract consumers, restaurants, grocers and riders throughout 2021, we are taking a prudent approach to our full year guidance.”

The company said it was maintaining its guidance for full-year GTV growth of between 30% to 40% and gross profit margins of 7.5-8.0%.

Deliveroo said it was difficult to know how much of the growth was driven by the lack of opportunity to eat out in cafes and restaurants in COVID-19 lockdowns, adding that it expected the rate of growth to slow as restrictions eased.

Deliveroo’s float in London was heralded at the debut of the decade, but it soured when the stock fell 30% on the first day, wiping more than 2 billion pounds off the company’s initial 7.6 billion pound valuation.

Some of Britain’s biggest investment companies shunned the listing, citing concerns about gig-economy working conditions and the share structure.

The shares have continued to decline and closed at 268 pence on Wednesday, 31% below the 390 pence they were priced at in the float.

($1 = 0.7260 pounds)

Reporting by Paul Sandle

Coinbase makes a landmark market debut with $99.6bn valuation

(qlmbusinessnews.com via news.sky.com– Thur, 15th April 2021) London, Uk – –

How The Right 5-10 Cryptocurrency Coins
Could Make You A Fortune
https://www.qlmbusinessnews.com/ohy1

The cryptocurrency exchange coinbase started trading on Wednesday at a valuation of nearly $100bn (£72bn), in a major boost to supporters of digital currencies such as bitcoin.

Coinbase shares opened at $381 (£276) on the Nasdaq, racing past the $250 reference price, and valuing the exchange at $99.6bn (£72bn).

The valuation means that Coinbase is worth more than traditional financial institutions such as HSBC, Barclays, and Standard Chartered.

It is the first time a major cryptocurrency business has been publicly listed, and is a landmark moment for a technology once considered trivial.

Coinbase earns money from transaction fees and has seen its profits soar as cryptocurrency trading has boomed since the start of the pandemic.Advertisement

Record levels of cash have poured in to digital currencies such as bitcoin and ethereum, plumping up Coinbase’s margins. Both have seen their prices climb meteorically in the past year, rising over 800% and 1,300% respectively.

Thanks to this, Coinbase booked an estimated $730m (£530m) to $800m (£580m) in net profits in the first three months of 2021, while it reported $1.8bn (£1.3bn) in revenue during the same period.

“The Coinbase IPO is potentially a watershed event for the crypto industry and will be something the Street will be laser focused on to gauge investor appetite,” said Wedbush analyst Daniel Ives in a note to investors.

The company is a “foundational piece of the crypto ecosystem,” he said.

Coinbase was founded in 2012 by Brian Armstrong, a software engineer at Airbnb, and Fred Ehrsam, a trader at Goldman Sachs.

The pair set out to simplify the process of buying and selling bitcoin, at a time when the currency was largely used by hobbyists fascinated by its technology, and criminals attracted to its anonymity.

By Ed Clowes

Post Office chief Read delivers plan to share profits with postmasters

(qlmbusinessnews.com via news.sky.com– Mon, 12th April 2021) London, Uk – –

Nick Read believes a profit-share arrangement could be in place at UK’s biggest retail network by 2025, Sky News learns.

The government should explore plans to turn the Post Office into a profit-sharing business, allowing postmasters to participate in the future financial success of Britain’s largest retail network, its chief executive has said.

Sky News has learnt that Nick Read, who has run the Post Office since the autumn of 2019, told colleagues last week that he wants ministers to sanction what would effectively amount to its partial mutualisation once its finances are in appropriate shape.

The ambition, which was outlined by Mr Read in a speech to his senior leadership team on Friday, would potentially enable thousands of postmasters across the UK to receive a financial stake in the Post Office by the middle of the decade.

“As we look towards the next Comprehensive Spending Review, I intend to work with government on the various means by which we could deliver on a longer-term aspiration to facilitate profit-sharing between Post Office Limited and postmasters when circumstances permit,” Mr Read said in the speech, a copy of which has been seen by Sky News.

“As we become commercially sustainable and no longer reliant on government subsidy, looking for new ways to ensure postmasters share fairly in that success is the right thing to do.

“And I do think it is important, particularly in the context of building something afresh, to share in an aspiration, a common goal.

“For [the] Post Office to be in a position, say by 2025, to make this a credible option for postmasters, their customers and the government would, it seems to me, represent a genuine achievement.”

Mr Read's aspiration remains at a conceptual stage, and there is no guarantee that ministers will agree to implement it.

Nevertheless, the fact that Mr Read – who has gained respect in Whitehall for his early efforts to modernise the scandal-hit organisation – was prepared to articulate it to senior managers suggests that it is unlikely to be dismissed out of hand.

In his wide-ranging speech, the Post Office chief also delivered the organisation's most fulsome corporate mea culpa to date for the IT scandal that caused dozens of postmasters to be wrongly convicted of theft, fraud and false accounting.

The crisis had turned the Post Office into Britain's “most untrustworthy brand”, the Court of Appeal was told last month as an appeal by more than 40 postmasters against their convictions got under way.

“Our organisation's historic handling of this matter fell short,” Mr Read said. “I am in no doubt as to the human cost of this.”

He added that the affair had caused “very deep pain” but warned that the Post Office would be unable to shoulder the financial burden of a major compensation bill alone, calling for government support to fund it.

“If the Court finds that a large-scale miscarriage of justice took place, we can expect it to carry a large-scale cost.

“The Post Office simply does not have the financial resources to provide meaningful compensation,” he told colleagues.

“I am urging government to work with us to find a way of ensuring that the funding needed for such compensation, along with the means to get it to those to whom it may become owed, is arranged as quickly and efficiently as possible.

“Acting swiftly would also enable the Post Office to place even more focus on ensuring that there can be no recurrence of these deeply damaging events.”

In December 2019, the Post Office agreed to pay nearly £58m to settle a legal claim brought by 550 sub-postmasters.

At the time, the network, which has around 11,500 branches across Britain, apologised, with Mr Read's predecessor, Paula Vennells, targeted by particularly fierce criticism over her handling of the crisis.

Mr Read added that the Horizon IT system at the centre of the scandal would be replaced “in favour of a modern, cloud-based system which postmasters will find more intuitive and easier to operate”.

A former chief executive of Nisa, the convenience store group, he has moved to address postmasters' concerns about the Post Office's corporate governance by agreeing to nominate two of them to the government-owned company's board.

In his remarks last week, he lambasted his predecessors for adopting “a ‘parent and child' relationship with its postmasters, rather than a partnership of equals”.

“There has been a pronounced imbalance of power in the relationship between us, creating a situation in which the company has felt that it has all the answers, and has expected postmasters to follow its lead unquestioningly.”

His speech came during a period of profound shifts in consumer behaviour which have been accelerated by the coronavirus pandemic.

Mr Read argued that preserving the future of the 460 year-old network would depend upon bold decisions being taken to ensure continued innovation.

Among the ways this would be achieved, he said, would be to complete its journey to being a fully franchised business, with a range of retail formats such as one combining parcels and bill payment services.

He added that the overall number of Post Offices would rise to 12,000 by 2025.

The Post Office is a separate company from Royal Mail Group, which was privatised in 2013 and floated on the London Stock Exchange.

Mr Read said that a deal reached between the two in December paved the way for his company to work with other major logistics and courier companies.

“The spectacular growth in online shopping we have witnessed since the start of the pandemic represents a very sizeable and achievable opportunity for our own growth at both corporate and branch level,” he added.

The Post Office's financial performance had, nevertheless, been adversely affected by the pandemic, Mr Read said, with earnings for last year likely to be “less than half” of the £86m achieved in 2019-20.

Since taking the reins, Mr Read has sold the Post Office's broadband business to Shell, raising close to £100m, and initiated a review of its insurance arm.

A Post Office spokesman confirmed that the contents of Mr Read's speech were genuine but declined to comment further.

By Mark Kleinman

Suez Canal Ever Given ship refloated, traffic finally moving again

(qlmbusinessnews.com via news.sky.com– Mon, 29th March 2021) London, Uk – –

The stranded container ship blocking the Suez Canal has been freed, allowing traffic in the channel to finally resume.

Egyptian authorities said other vessels were moving again after the gigantic Ever Given ship was refloated, which was seen by witnesses for the Reuters news agency.

The Ever Given has started heading towards the Bitter Lakes area, according to Egyptian television.

Efforts to get the ship moving again appeared to have been frustrated after high winds swung it back across the channel after its partial refloating earlier on Monday.

There had been intensive efforts to push and pull it with 10 tug boats and vacuum up sand with several dredgers at high tide.

Osama Rabei, the head of the Suez Canal Authority, confirmed the ship had responded successfully to “pull-and-push manoeuvres”.

Speaking earlier, he said workers had almost completely straightened the vessel's course and that the stern had moved 102 metres (334 feet) from the canal bank.

The oil price fell as news of developments in the canal emerged, with the price of Brent crude down by 2% to just over $63 (£46) a barrel.

It had been feared the Panama-flagged, Japanese-owned ship might be stuck for weeks.

Dredgers overnight shifted more than 27,000 cubic metres of sand – to a depth of 18m (59ft) – with work taking place around the clock.

The skyscraper-sized Ever Given became stuck in Egypt's Suez Canal last Tuesday and the resulting disruption to the vital waterway has held up £6.5bn in global trade each day.

Hundreds of other vessels had remained trapped in the canal waiting to pass, carrying everything from crude oil to cattle.

More than two dozen vessels opted for the alternative route between Asia and Europe around the Cape of Good Hope, adding around a fortnight to journeys and threatening delivery delays.

The 400m (1,312ft) long Ever Given became jammed diagonally across a southern section of the canal in high winds.

As of Saturday, 321 boats were waiting to get through the canal, including dozens of container ships, bulk carriers and liquefied natural gas (LNG) or liquefied petroleum gas (LPG) vessels.

London stocks hit a near one-month low as lockdown fears weigh

(qlmbusinessnews.com via uk.reuters.com — Thur, 28th Jan 2021) London, UK —

(Reuters) – British shares hit a near one-month low on Thursday as energy stocks tracked commodity prices lower following virus and lockdowns-led demand worries, while the vaccine row between the European Union and AstraZeneca Plc continued to weigh.

AstraZeneca was one of the top drags to the FTSE 100 index as Britain demanded it must receive all of the COVID-19 vaccines it had ordered and paid for after the European Union asked the drugmaker on Wednesday if it could divert supplies of the Oxford-developed shots from Britain.

The blue-chip FTSE 100 index fell 1.5%, with automakers and energy stocks being one of the top losers. The mid-cap index shed 1.6%.

“It’s a very speculative bubble of a market that has definitely led to people suggesting for a pullback,” said Keith Temperton, an equity sales trader at Forte Securities.

“So, in my view, it’s a long overdue pullback and nothing to be alarmed about particularly, but rather just an expected market reaction for London.”

Higher virus cases and lockdowns led the UK to see its biggest rise in vacant shops in over two decades, while car output fell to its lowest level since 1984 after the pandemic shut factories and hurt demand.

The export-heavy FTSE 100 recorded consistent monthly gains since Novemeber, but has recently lost steam and trades flat for January, as a surge in infections and tougher restrictions hit sentiment for risk assets.

British airline easyJet fell 1.1% after warning that it would fly no more than 10% of 2019’s capacity in the Jan-March quarter, while London-listed shares of Hungarian airline Wizz Air gained 0.6% even after reporting a third-quarter loss.

Miner Anglo American slipped 0.1% after it trimmed its production outlook for diamonds in 2021, owing to operational challenges, but it kept output targets for most other metals unchanged.

Reporting by Shashank Nayar 

Amateur investors buy stock as ‘failing’ firm soars in value

(qlmbusinessnews.com via bbc.co.uk – – Wed, 27th Jan 2021) London, Uk – –

It's a battle between Wall Street pros and upstart investors using social media platforms like Reddit. And at the moment, the upstarts have the upper hand.

At the centre of the tussle is a US video games bricks and mortar retailer called Gamestop, arguably something of a relic in a world moving online.

Shares in the business have skyrocketed, with the price up 92% at the close of play on Tuesday, bringing the gain over the last few trading days to 276%.

It is, says analyst Neil Wilson from markets.com, getting weird: “We are seeing some serious funny business in some corners of the market.”

“Will it end badly?” asks Thomas Hayes, managing director at Great Hill Capital hedge fund. “Sure. We just don't know when.”

What's driving up the Gamestop price? Certainly not any good news coming out of the company. Gamestop – described as a “failing mall-based retailer” by one professional investor – made a loss of $795m in 2019, and probably several hundred more in 2020.

Instead, an army of savvy social media day traders with access to free trading platforms, and who probably have a lot of time on their hands during lockdown, are swapping tips and ramping up prices via Reddit's chat thread wallstreetbets.

Gamestop is not the only stock to get their attention – Blackberry and Nokia Oyjis are others – but is currently the battleground between the Goliaths like hedge funds and big investors, and the Davids who make up Reddit's private punters.

Key to what's going on is “shorting”, where, say, a hedge fund borrows shares in a company from other investors in the belief that the price of stock is going to fall.

The hedge fund sells the shares on the markets at, for example, $10 each, waits until they fall to $5, and buys them back. The borrowed shares are returned to the original owner, and the hedge fund pockets a profit.

That's the somewhat simplistic theory, anyway.

$2bn losses

Gamestop is the most shorted stock on Wall Street, with some 30% of the shares thought to be in the hands of hedge fund borrowers. But Reddit's retail investors have been spurred into buying Gamestop shares and placing options – pushing up the price and putting a “short squeeze” on the pros.

In this supercharged trading environment, the big Wall Street investors rush back into the market to limit their losses – with the demand pushing up the price still further. One hedge fund, Melvin Capital Management, reportedly had to be bailed out with more than $2bn to cover losses on some shares, including Gamestop.

For many Reddit investors, it not just about making money. They smell blood.

Analyst Neil Wilson says that, from reading the Reddit chat threads, the day traders' battle with Wall Street is clearly personal.

“Among the many aspects of this story that are strange, what is so unusual is the peculiar vigilante morality of the traders pumping the stock. They seem hell-bent on taking on Wall Street, they seem to hate hedge funds and threads are peppered with insults about ‘boomer' money.

“It's a generational fight, redistributive and all about robbing the rich to give to the millennial ‘poor'.”

But many big investors are refusing to budge and continue to hold their Gamestop stock at rock bottom prices. They believe the tide will turn on Reddit's herd instinct and Gamestop shares will come back to earth.

“These are not normal times and while the [Reddit] thing is fascinating to watch, I can't help but think that this is unlikely to end well for someone,” Deutsche Bank strategist Jim Reid said.

Tears and headaches

For stock market veterans it's an example of the madness of speculative trading that can only end in tears. And for regulators, it's a headache, as they are the ones who should be cracking down on market manipulation.

Jacob Frenkel, a former lawyer at the Securities and Exchange Commission, the main US financial regulator, said: “Such volatile trading fuelled by opinions where there appears to be little corporate activity to justify the price movement is exactly what SEC investigations are made of.”

However, other experts believe Reddit's legion of investors represent a generational shift in attitudes to money and use of new technology.

“I don't think this is a fad,” said John Patrick, a fund expert at VanEck. “A retail trader will not lean on Wall Street to manage their money and I definitely now see an antagonistic relationship between the old guard [Wall Street] and individual traders who are on the rise,” he said.

By Russell Hotten

UK grocery sales in November hit record 10.9 billion pounds – Kantar

(qlmbusinessnews.com via uk.reuters.com — Tue, 8th Dec 2020) London, UK —

LONDON (Reuters) – November was the most lucrative month ever for the UK grocery market, with 10.9 billion pounds spent, as out of home eating and drinking was restricted by England’s second national lockdown, industry data showed on Tuesday.

Market researcher Kantar said grocery sales rose by 11.3% in the 12 weeks to Nov. 29 year-on-year and were up 13.9% year-on-year in the last four of those weeks.

England’s second lockdown to stem rising COVID-19 infections started on Nov. 5 and ran until Dec. 1.

All non-essential shops had to close, along with pubs, cafes and restaurants, except to offer takeaway food. People were also encouraged to work from home if possible. All those factors boosted supermarket sales.

“November as a whole saw shopper frequency hit its highest level since the beginning of the pandemic, suggesting more confidence among people going into stores,” said Fraser McKevitt, head of retail and consumer insight at Kantar.

Kantar forecast spending would be close to 12 billion pounds in December, around 1.5 billion pounds more than December last year.

Of Britain’s big four supermarket groups, No. 4 player Morrisons again outperformed rivals over the 12 week period with sales growth of 13.7%.

Second-ranked Sainsbury’s saw growth of 10.8%, with market leader Tesco on 10.4%. Walmart owned Asda was again the laggard with growth of 7.7%.

Reporting by James Davey

UK construction industry unexpectedly picked up in September – PMI

(qlmbusinessnews.com via uk.reuters.com — Tue, 6th Oct, 2020) London, UK —

LONDON (Reuters) – Britain’s construction industry unexpectedly picked up speed in September, helped by a post-lockdown bounce in the housing market, a survey showed on Tuesday.

The IHS Markit/CIPS UK Construction Purchasing Managers’ Index accelerated to 56.8 from 54.6 in August, above all forecasts in a Reuters poll of economists which had pointed to a slight slowing.

“Following August’s slowdown, growth in UK construction activity rebounded strongly in September,” Eliot Kerr, an economist at IHS Markit, said.

“Forward-looking indicators point to a sustained rise in activity, with new work increasing at the quickest pace since before the lockdown and sentiment towards the 12-month outlook at its strongest for seven months.”

Construction firms continued to cut jobs, although at a significantly slower rate than in August.

Increases in activity in home-building – which reported the fourth sharp monthly increase in a row – and in commercial construction more than offset a fall in civil engineering work.

Britain’s housing market has boomed since coronavirus restrictions were lifted in May, driven by a tax cut, pent-up demand from earlier in the year and demand for more spacious homes after the lockdown.

Some industry officials have warned that the housing market recovery is likely to run out of steam with unemployment likely to rise as the government pares back its job support programmes.

The all-sector PMI – a combination of the construction, services and manufacturing surveys – fell back to 56.6 from August’s six-year high of 58.7, reflecting slower growth in Britain’s dominant services industry.

Reporting by William Schomberg

Ocado stock market value soared to £21.66bn overtaking Tesco as UK’s most valuable retailer

(qlmbusinessnews.com via theguardian.com – – Wed, 30th Sept 2020) London, Uk – –

Delivery-based supermarket’s value rises to £21bn despite selling 1.7% of UK’s groceries

Ocado has overtaken Tesco to become the UK’s most valuable retailer after its stock market value soared to £21.66bn.

Tesco is worth £21.06bn despite controlling nearly 27% of the UK grocery market. By comparison Ocado, which is already worth more than double the combined value of Sainsbury’s and Morrisons, sells just 1.7% of the UK’s groceries.

Former Tesco boss Sir Terry Leahy once famously described Ocado as a “charity” due to its track record of losses during the noughties.

Ocado has eclipsed Tesco just as the supermarket’s new chief executive, Ken Murphy, prepares to take charge on Thursday. He replaces Dave Lewis who has been running the UK’s biggest retailer since 2014.

Murphy faces a baptism of fire as Tesco grapples with recession, running supermarkets during a pandemic and a potential no-deal Brexit. He also needs to get the share price, which has gone sideways under Lewis, moving.https://www.theguardian.com/email/form/plaintone/3887Sign up to the daily Business Today email or follow Guardian Business on Twitter at @BusinessDesk

The Tesco board is painfully aware of the march of the Ocado share price. In the summer the company suffered one of the biggest-ever shareholder revolts over executive pay. Shareholders objected to a late change to part of an executive pay plan, which handed an additional £1.6m to Lewis and £900,000 to finance director Alan Stewart.

The change involved removing online grocer Ocado from a comparator group against which Tesco’s share performance was measured. With Ocado included the two men would not have qualified for the extra payout.

Investors have fallen in love with Ocado on the back of the success of its tech business Ocado Solutions, which sells its grocery-picking expertise to foreign supermarkets. The coronavirus pandemic has also triggered a boom in online shopping. At the height of the pandemic online food sales nearly doubled but, despite the recent slowdown, they now account for 12.5% of total grocery sales versus about 7% pre-crisis.

By Zoe Wood

Nokia wins contract with BT to supply 5G radio equipment

(qlmbusinessnews.com via uk.reuters.com — Tue, 29th Sept 2020) London, UK —

STOCKHOLM/HELSINKI (Reuters) – Nokia NOKIA.HE has clinched a deal with Britain's biggest mobile operator BT BT.L to supply 5G radio equipment, the Finnish company said on Tuesday, in one of the first major wins under new CEO Pekka Lundmark.

The deal will make Nokia BT’s largest equipment provider and comes just months after Britain said it would ban China’s Huawei Technologies from next-generation 5G telecom networks.

The size of the contract was not disclosed.

Nokia has won 63% of the BT contract, or about 11,600 radio sites, a source familiar with the matter said.

Nokia currently powers BT’s network in Greater London, the Midlands and rural locations, but the new contract will add multiple towns and cities across the United Kingdom.

BT Group CEO Philip Jansen said the agreement would allow it to continue the rollout of fixed and mobile networks, with digital connectivity critical to the UK’s economic future.

Under the current ban, UK operators will not be able to purchase 5G components from Huawei from the end of this year and must remove all existing Huawei gear from the 5G network by 2027, offering opportunities for for Nokia and Sweden's Ericsson ERICb.ST.

Nokia had a 21% share of the global radio access network (RAN) market in 2019, versus 29% for Ericsson and Huawei’s 31%, according to data from Moody’s.

While Nokia has been winning contracts from operators across the world, it suffered a setback earlier this month when it lost out to Samsung Electronics 005930.KS on a part of a contract to supply new 5G equipment to Verizon VZ.N.

Nokia is under new management with Lundmark taking the top job last month and telecoms veteran Sari Baldauf becoming the chairwoman in May.

Reporting by Supantha Mukherjee and Anne Kauranen

How Palantir Built Data-Mining Empire

Source: CNBC

After 17 years, data analytics company Palantir is making its public market debut. Best known for its sometimes controversial work with U.S. government agencies like the CIA, the DoD and ICE, Palantir has increasingly been working with commercial customers as well, which investors hope will put it on a path to profitability.

Chancellor Rishi Sunak gives businesses extra flexibility on repaying COVID-19 loans

(qlmbusinessnews.com via uk.reuters.com — Thur, 24th Sept 2020) London, UK —

LONDON (Reuters) – British finance minister Rishi Sunak said on Thursday he would introduce a new scheme to give businesses flexibility to repay loans taken out during the coronavirus crisis, giving them up to 10 years to repay the loans rather than six.

Under the government’s Bounce Back Loan Scheme, 1.3 million small businesses have taken out a total of 38.0 billion pounds ($48.4 billion) in loans worth up to 50,000 pounds each, from banks which have received a 100% state guarantee.

“To give those businesses more time and greater flexibility to repay their loans, we are introducing Pay-as-you-Grow. This means loans can now be extended from six to 10 years, more than halving the average monthly repayment,” Sunak told parliament.

“Businesses who are struggling can now choose to make interest only payments, and anyone in real trouble can apply to suspened repayments altogether for up to six months.”

Reporting by David Milliken and Andy Bruce

Lockdown fears cause shares to fall sharply in travel, hotel and pubs

(qlmbusinessnews.com via bbc.co.uk – – Mon, 21st Sept 2020) London, Uk – –

Leading shares across Europe have fallen sharply in morning trading amid fears that a renewed rise in coronavirus cases will blight economic prospects.

In London, the benchmark FTSE 100 share index was down more than 3%, with airlines, travel firms, hotel groups and pubs leading the rout.

Worst hit was British Airways owner IAG, which slumped more than 12%.

Similar falls were seen on markets in Paris, Frankfurt and Madrid.

Banking shares were affected by an extra set of concerns as allegations of money-laundering surfaced in leaked secret files.

HSBC, the bank at the centre of the scandal, saw its share price fall more than 5% in London, but the revelations dragged down the entire sector, with Barclays, Lloyds and NatWest all dropping about the same amount.

The downward trend affected all but a handful of stocks on the UK's 100-share index. Only online delivery service Just Eat, supermarkets Tesco and Morrisons and miner Fresnillo made it into positive territory.

The FTSE 250 index, seen as a better reflection of the health of the UK economy, was down 4% by lunchtime.

One of its biggest fallers was pub and restaurant owner Mitchells & Butlers, which dropped more than 15% as concerns grow that the hospitality industry would have most to lose from a fresh lockdown.

The pound also lost ground against the dollar, falling 0.47% to $1.2863 by lunchtime. It fell marginally against the euro to €1.0910.

Why does all this matter to me?

Many people are more affected by stock market falls than they might think.

There are millions of people with a pension – either private or through work – who will see their savings (in what is known as a defined contribution pension) invested by pension schemes. The value of their savings pot is influenced by the performance of these investments.

Pension savers mostly let experts choose where to invest this money to help it grow and a proportion will be in shares.

Widespread falls in share prices are likely to be bad news for these investments, although pension investors stress these are long-term investments and are designed to ride out bouts of weakness.

Analysis: By Theo Leggett

There has certainly been an element of European unity on the markets today, with the FTSE 100 index in London, the Cac 40 in Paris, the Dax in Frankfurt and the Ibex in Madrid all suffering similar falls.

The reason behind the gloom seems pretty clear. With the number of Covid-19 cases multiplying rapidly here and in many European countries, there's a real prospect of new restrictions on daily life. In some regions – such as Madrid, for example – they're already in place.

The fear is that although these measures are unlikely to be as severe as the lockdowns in spring, they will nonetheless weigh on economic activity and could stifle the post-lockdown recovery.

Shares are down across the board, but inevitably, the companies which rely on people being able to get out and about and mingle are among the worst affected.

Airlines, tourism firms and hospitality businesses have already had a dreadful year – and investors know they can ill afford further setbacks.

‘Bitter pill'

Coronavirus cases have been surging in many European countries, as governments strive to avoid another round of national lockdowns.

In the UK, top scientists are warning that the country is at a “critical point” in the pandemic and “heading in the wrong direction”.

Prime Minister Boris Johnson is understood to be considering a two-week mini-lockdown in England – being referred to as a “circuit-breaker” – in an effort to stem widespread growth of the virus.

Susannah Streeter, senior investment and markets analyst at Hargreaves Lansdown, said: ”The FTSE 100 is worst hit among its European peers with a storm of pessimistic news swirling, affecting sectors across the board.”

She added that concerns for the travel industry had had a “domino effect”, with aircraft engine manufacturer Rolls Royce hit, as investors saw no end to the falling demand for new planes.

At the same time, the prospect of evening coronavirus curfews, after a summer of recovering sales, was “a bitter pill to swallow” for the hospitality industry,

If you add the prospect of a no-deal Brexit into the murky mix, there is little surprise so many investors seem to have caught a severe case of the jitters today.”

UK economy continues recovery in July according to official figures

(qlmbusinessnews.com via bbc.co.uk – – Fri, 11th Sept 2020) London, Uk – –

By Dearbail Jordan Business reporter

The UK economy grew by 6.6% in July, according to official figures, but remains far below pre-pandemic levels.

It is the third month in a row that the economy has expanded.

But the Office for National Statistics (ONS) said that the UK “has still only recovered just over half of the lost output caused by the coronavirus”.

Hairdressers, pubs and restaurants contributed to growth after companies were allowed to reopen in July.

Is the UK economy back to pre-coronavirus levels?

Definitely not. The UK's economy – which is measured by the value and the volume of goods and services it produces – is still 11.7% smaller than it was in February, before lockdown was imposed.

Growth in July was also slower than the 8.7% expansion seen in June.

There are encouraging signs, however. Thomas Pugh, UK economist at Capital Economics, said the reopening of restaurants and pubs meant the accommodation and food services sector “rose by a whopping 140.8%” between June and July.

This had a knock-on effect for the alcohol industry which grew by 32.7%.

Keeping youngsters occupied while at home also continued to boost demand for toys and games, said the ONS, while holidaying in the UK supported campsites, cottages and caravan parks “because of a large increase in staycations”.

However, activity in the accommodation and food services sector was still 60.1% below the level recorded in February.

And while Mr Pugh expects the Eat Out to Help Out scheme to provide a further boost in August, “now that most sectors in the economy are open again there is little scope for further large rises in monthly GDP”.

Meanwhile, the car sector saw demand return to pre-pandemic levels.

“Car sales exceeded pre-crisis levels for the first time with showrooms having a particularly busy time,” said Darren Morgan, director of economic statistics at the ONS.

Analysis: By Faisal Islam

Up, up, but not away. The UK economy continued a sharp recovery from lockdown in July, growing by a bumper 6.6% in the month. But the rate of recovery was a little slower than in June, raising some concerns about the ongoing strength of the bounce back.

The economy is still nearly 12% smaller than before the pandemic crisis, and has recovered just over half of the lost output during the shutdowns.

While the third quarter is on course to see a record number for growth and the official end of recession, fears remain that the recovery could peter out.

Business groups continue to push for extensions to government support packages that are due to close. The figures in July reflected the partial reopening of retail, manufacturing, and some public sector activities such as schools.

How long will recovery take?

Forecasts vary but the consensus is it won't be swift.

The UK fell into recession after activity shrank for the first and second quarters of this year after the government announced a lockdown to stop the spread of the coronavirus.

And in the three months to July, the economy shrank by 7.6%.

Mr Pugh questioned how strong the UK's recovery would be throughout the rest of the year.

“Talk of tax rises at the next Budget, a further deterioration in the Brexit negotiations and a worrying rise in the number of virus cases and tighter social distancing restrictions will all conspire to slow the recovery even further,” he said.

Dean Turner, economist at UBS Global Wealth Management, predicts that it will take until the end of 2021 before the UK recovers to pre-pandemic levels.

“Even with a managed exit from the Brexit transition agreement, it is unlikely that the lost output would be recovered before the end of next year,” he said.

“The latest twist in negotiations raises the prospect that any recovery may take longer.”

What risks lie ahead?

The number of coronavirus cases in the UK have begun rising again and social gatherings of more than six people will be illegal in England from Monday.

“The recovery likely will stall if, as looks likely, new Covid-19 infections continue to rise, keeping people working from home and avoiding consuming services that require close human contact,” said Samuel Tombs chief UK economist, Pantheon Macroeconomics.

“Accordingly, we continue to expect GDP to be about 5% below its peak at the end of this year.”

Meanwhile, the Coronavirus Job Retention Scheme is due to end on 31 October.

Chancellor Rishi Sunak has been emphatic that it will not continue. However, the Resolution Foundation think tank said he “needs to reconsider his plans to swiftly phase out support given that the economic crisis will be with us for some time to come”.

Former prime minister and chancellor Gordon Brown, warned that ending the furlough scheme was a “cliff-edge” that could trigger “a tsunami of unemployment”.

“The government's got to change course here,” he told the BBC's Today programme.

Morrisons reported a £155m hit to profits

(qlmbusinessnews.com via news.sky.com– Thur, 10th Sept 2020) London, Uk – –

The chain moves to reward staff and investors as it slaps itself on the back for its response to the coronavirus crisis to date.

Morrisons has reported a £155m hit to profits from costs related to the coronavirus crisis.

The UK's fourth-largest supermarket chain said – like rivals – it had seen a surge in sales during the first half of its financial year in the run-up to – and during – the COVID-19 lockdown that began in March, which saw all non-essential retail shuttered.

It revealed an 8.7% increase in like-for-like sales, when fuel sales were excluded, in the six months to 2 August compared to the same period last year.Where jobs are being lost in UK economyWhere jobs are being lost in UK economy

But it said total revenues were down 1.1% to £8.73bn, reflecting the loss of fuel sales during the period as roads remained largely empty.

Morrisons reported profit before tax and exceptional items of £148m – down 25.3%.

It blamed the coronavirus costs bill but said the net hit came in at £62m because of business rates relief of £93m.

The chain took on an additional 45,000 staff to cope with demand as the crisis gathered pace – with in-store customers stripping aisles of essentials such as toilet roll ahead of the lockdown itself.

It reported that online and home delivery order capacity rose five-fold to help meet demand, with five new growth channels – Morrisons.com store pick, food boxes, doorstep, Morrisons on Amazon and Deliveroo – now operating.

Its results statement said: “The mix of the very strong first-half sales growth was weighted towards online channels and lower margin categories. In addition, fuel sales growth was very negative, our cafes were temporarily closed, and we invested in supporting our colleagues, NHS workers and farmers with extra discounts.”

Morrisons said it was to reward staff with a guaranteed annual bonus of 6%.

It raised its interim dividend by 5.7% and forecast continued sales momentum in the second half of the year, part-aided by fuel sales starting to build.

Listed supermarket chains have largely been spared the bloodbath for share values witnessed by many during the COVID crisis.

Morrisons – down almost 3% in the year to date – saw its stock fall by 4% in early trading on Thursday.

Arlene Ewing, investment manager at Brewin Dolphin, said of the company's update: “Morrisons' results are indicative of the wider challenge facing supermarkets – while many expected them to thrive in the current environment, buoyed by business rates relief among other things, that hasn't quite turned out to be the case.”

She added: “There are, nevertheless, positives to be taken in the form of expectations that COVID-19 costs will fall significantly in the second half, an increase to the dividend, and a relatively bullish outlook from management in this latest update.”

Chief executive David Potts said of the performance: “From the start of the pandemic we stepped up and put the company's assets at the disposal of the country to help feed the nation.

“Morrisons is at the heart of local communities and responded quickly when it mattered most, and we are very grateful for the British public's appreciation of all the vital work our colleagues are doing.

“I believe we are seeing the renaissance of British supermarkets.”

UK economy heading for its biggest contraction “in living memory”

(qlmbusinessnews.com via news.sky.com– Tue, 5th May 2020) London, Uk – –

A closely-watched survey shows an unprecedented slump for the dominant services sector during the first full month of lockdown.

The UK economy is heading for its biggest contraction “in living memory”, according to a report highlighting a slump in activity for the UK's powerhouse services sector.

The IHS Markit/CIPS Purchasing Managers' Index (PMI) for April suggested a contraction in quarterly GDP (gross domestic product) of at least 7%.

But it cautioned that the number would be expected to be far worse because its survey data does not cover large parts of the services economy including retail and activity among the self-employed – among the hardest hit by the COVID-19 crisis.

The sector's PMI reading came in at its weakest level since it first started in 1996, dropping to 13.4 in April from 34.5 in March.

Any reading above 50 represents growth.

A composite reading, that included manufacturing, released almost a fortnight ago laid bare the effects of the lockdown on the UK economy – in place since 23 March – highlighting an unprecedented slump.

Tim Moore, economics director at IHS Markit, said of the latest figures: “April's PMI data highlights that the downturn in the UK economy during the second quarter of 2020 will be far deeper and more widespread than anything seen in living memory.

“Historical comparisons of the PMI with GDP indicate that the April survey reading is consistent with the economy falling at a quarterly rate of approximately 7%, but we expect the actual decline in GDP could be even greater, in part because the PMI excludes the vast majority of the self-employed and the retail sector.

“Just one in five service providers managed to avoid a drop in business activity since March and those hardest hit by social distancing measures and travel restrictions often reported complete stoppages of business operations.”

The toll on the economy is acute because of massive government borrowing to pay for the series of support schemes on offer to businesses and individuals who are currently furloughed during the lockdown.

Government figures released on Monday showed the Job Retention Scheme was paying the bulk of wages due to 6.3 million people at a cost, to date, of £8bn.

Much depends on the timing of an easing in the lockdown – with details expected to be revealed on Sunday by the prime minister.

The Bank of England is due to give an update on its projections for the economy when it delivers its latest Monetary Policy Report this week.

A member of its rate-setting committee, Gertjan Vlieghe, has already suggested the UK could be living through the worst economic slump for several centuries with the recovery from lockdown likely to be U-shaped rather than one resembling a ‘V' – or quick bounce back.

A scenario by the Office for Budget Responsibility has pointed to the possibility of a 35% second quarter contraction in GDP with a leap in unemployment of two million.

Howard Archer, chief economic adviser to the EY ITEM Club, said he did not expect any further stimulus to arise from Thursday's meeting of the Monetary Policy Committee.

He said after the PMI reading: “We expect the economy to contract around 13% quarter-on-quarter in the second quarter on the assumption that there is some lifting of restrictions on activity during the quarter.”

Reporting James Sillars

WeWork co-founder Adam Neumann files a lawsuit against Japan’s SoftBank over $3bn deal

(qlmbusinessnews.com via theguardian.com – – Tue, 5th May 2020) London, Uk – –

Former CEO of office-sharing company accuses Japanese bank of abusing its power.

Adam Neumann, WeWork’s co-founder and former chief executive, has filed a lawsuit against Japan’s SoftBank, accusing it of abusing its power in order to terminate an agreement to buy $3bn (£2.4bn) of stock from him and other early investors in the office-sharing company.

SoftBank, which is run by Japanese billionaire Masayoshi Son who is also WeWork’s biggest investor, announced in early April that it was walking away from the share tender rescue deal hammered out last October to save WeWork from collapse.

It said at the time it had “no choice” but to scrap the rescue deal because WeWork had failed to meet several conditions. It also cited concerns about “multiple, new, and significant pending criminal and civil investigations”.

Neumann would have been the biggest beneficiary of the payouts to minority shareholders, as he was lined up to sell $970m worth of shares.

The lawsuit, filed in a Delaware court, said Softbank and its Vision Fund had let down Neumann and WeWork staff.

“Mr Neumann put his trust in [SoftBank and the Vision Fund] to be stewards of WeWork, which he — and thousands of others — had worked so hard to build,” the lawsuit said.

Neumann had upheld his end of the bargain, according to the filing, while WeWork’s Japanese investors had not.

“The abuses committed by [SoftBank] and SBVF [SoftBank Vision Fund] are so brazen that they have prompted legal action by a special committee of WeWork’s board,” the lawsuit added.

Responding to Neumann’s lawsuit, Rob Townsend, the SoftBank chief legal officer, said: “SoftBank will vigorously defend itself against these meritless claims.”

He added: “Under the terms of our agreement, which Adam Neumann signed, SoftBank had no obligation to complete the tender offer in which Mr Neumann – the biggest beneficiary – sought to sell nearly $1bn in stock.”

Neumann resigned as chief executive last September from the firm he co-founded in 2010, after scrapping plans for a stock market flotation. Investors balked at the company’s sky-high valuation. It had been valued at $47bn, despite losing $3bn in the past three years, but that valuation was slashed to $8bn by the time of the bailout in October.

SoftBank has been losing money on its investments and last week predicted a wider full-year loss of 900bn yen (£6.8bn). It expects to lose £5.3bn from its investment in WeWork alone.

By Julia Kollewe

UK Finance figures show one in nine mortgage borrowers on payment break

(qlmbusinessnews.com via news.sky.com– Tue, 14th April 2020) London, Uk – –

UK Finance figures showed that around 61,000 mortgage holidays were being granted every day over recent weeks.

One in nine home loans in the UK are now on a mortgage holiday because of measures to support those affected by the coronavirus pandemic, new figures show.

UK Finance, the trade body for Britain's banks and building societies, said lenders had agreed to give repayment breaks to more than 1.2 million mortgage borrowers.

The number of payment holidays in place more than tripled in the two weeks between March 25 and April 8, growing from 392,130 to 1,240,680, the organisation said.

That meant an average of around 61,000 were being granted by lenders every day.

The figures were disclosed after a series of measures to help people facing financial difficulties due to the pandemic – including mortgage holidays – were announced by lenders a month ago.

For the average mortgage holder, the payment break amounts to £260 a month of suspended interest payments.

UK Finance chief executive Stephen Jones said: “The industry has pulled out all the stops in recent weeks to give an unprecedented number of customers a payment holiday, and we stand ready to help more over the coming months.

“We understand that the current crisis is having a significant impact on household finances for people across the country.”

However, Mr Jones said that payment holidays were not the right solution for everyone and borrowers should check with their lenders about the support available and how to apply.

The mortgage holidays are designed to help people struggling to make their payments, for example if they have had a pay cut or their work has temporarily stopped due to COVID-19.

They can request a mortgage payment holiday of up to three months.

Payment holidays are available to customers who are up-to-date on their mortgage payments. They will still owe the money and interest will still accrue.

Homeowners applying for a mortgage payment holiday will need to self-certify that their income has been either directly or indirectly impacted by coronavirus.

UK Finance has said firms will make every effort to ensure payment holidays do not negatively impact on credit files.

It added that telephone lines were extremely busy so customers were advised to look at their lender's website in the first instance.

Borrowers have been urged not to cancel their direct debits before a payment holiday has been agreed, as this will be counted as a missed payment and could impact their credit file.

Banks have been under pressure to act as the coronavirus crisis takes a heavy toll on the economic situation of millions of Britons.

Many have already axed dividends and cut bonuses for top bosses.

But analysis by Sky News last week revealed that banks were raising interest rates on mortgages, defying efforts by the Treasury and Bank of England to ease the burden on households.

John-Paul Ford Rojas

Pound takes a hit as Boris Johnson’s battles coronavirus

(qlmbusinessnews.com via news.sky.com–Tue, 7th April 2020) London, Uk – –

Market experts say the PM's condition will be reflected in sterling's value as he is treated for COVID-19 in intensive care.

The pound has taken a hit against the safe haven dollar on news of Boris Johnson's deterioration as he battles coronavirus in intensive care.

Sterling lost six tenths of a cent against the greenback late on Monday evening when it was confirmed the PM's condition had taken a turn for the worse.

Market analysts warned that the UK currency was likely to be pegged to developments on Mr Johnson's health as Dominic Raab, the foreign secretary, steps up to assume some of his responsibilities.

The pound had been trading at around $1.23 in advance of the Downing Street statement but had recovered most of the ground lost during Asia trading overnight.

Its fortunes were in stark contrast to those of equity markets after the week began with solid gains in Asia and in Europe.

The Dow Jones Industrial Average in New York clawed back almost 8% of value lost since markets first took fright from COVID-19 in February.

Tuesday saw a cautious clawback in Asia, despite that lead from New York, while the FTSE 100 built on the previous session's 3% gain and was a further 3% up, hitting 5,752 going into the afternoon.

Coronavirus: Prime Minister Boris Johnson moved to intensive care after condition worsens

Analysts saw US indices making further strides at the open on Wall Street.

They attribute the rally this week to signs the COVID-19 crisis could be easing in the worst-hit regions of Europe.

Travel-related stocks – worst hit since the rout in values began in February – saw the biggest gains in London with cruise operator Carnival and easyJet both up 20% though still sharply down on the year to date.

Oil firms also staged a recovery on growing investor hopes of an output cut to boost weak prices being agreed by major producing nations.

Cineworld was among companies to update on its fortunes – as all its 787 cinemas closed globally.

It suspended the payment of its latest dividend while bosses said they had agreed to defer pay and bonuses.

But market analysts said the pound was a clear focus given Mr Johnson's condition – marking a new front for its fortunes since the collapse in value witnessed since the Brexit vote in 2016.

Chris Scicluna, head of economic research at Daiwa, said: “Clearly the pound has weakened and that reflects the uncertainty and clarity over how much authority Raab will have.

“From an economic point of view there's unlikely to be much change.

“But if and when there are difficult decisions to be made, the lack of guidance at the top could be concerning.”

Junichi Ishikawa, senior FX strategist at IG Securities in Tokyo, said: “The currency market has remained fairly calm, but there will be more downside for sterling if Johnson's condition worsens.”

By James Sillars

US Senate agree massive economic relief package worth more than $1.8 trillion

(qlmbusinessnews.com via bbc.co.uk – – Wed, 25th Mar 2020) London, Uk – –

US President Donald Trump and the Senate have agreed a massive economic relief package worth more than $1.8 trillion (£1.5tn).

The package includes money to bail out industries that have been affected by the coronavirus crisis.

Republican Senate Majority leader Mitch McConnell described it as a “wartime level of investment” in the economy.

Markets surged in the US on Tuesday in anticipation of a deal, and shares rose in Europe and Asia on Wednesday.

On Wall Street, the Dow Jones jumped by 11.4% on Tuesday – its biggest one-day gain since the Great Depression.

Japan's benchmark Nikkei 225 index closed 8% higher on Wednesday following news of the relief deal.

Markets in Europe were also trading higher, with London's FTSE 100 index up more than 1%.

Full details of the deal agreed in the US will not be published until later on Wednesday. However, it is expected to contain measures to help people pay bills if they are laid off because of the virus, expand unemployment assistance by $250bn and get $350bn in emergency loans to small firms.

Mr McConnell said it would also “stabilise” key industrial sectors and give money to hospitals and other healthcare providers which were having difficulty getting equipment.

“We're going to pass this legislation later today,” Mr McConnell added.

Senate Democratic Leader Chuck Schumer called the package “the largest rescue package in American history”. He said it was a “Marshall Plan” for hospitals. “Help is on the way, big help and quick help.”

Separately on Tuesday, President Trump said he wanted to get the economy up and running again by Easter.

He said he was speaking to the Coronavirus Taskforce about when to open the US for business and that the Easter weekend -12 April – presented a “beautiful time, a beautiful timeline” and that he hoped to be able to open at least some sections of the country.

Reacting to news of the stimulus package, Tom Stevenson, investment director at fund manager Fidelity International, said: “It's good news, but we're not out of the woods yet.

“When markets are falling, you get these big rallies but you shouldn't get stuck on that. They do bounce around in these situations.”

The latest swing in share prices continues a period of unprecedented volatility as markets react wildly to the economic impact of the coronavirus pandemic.

This month alone has seen the Dow having the five biggest daily gains and five biggest falls of its 135-year history.

Many countries are now working on stimulus packages to support their economies, but these plans have received mixed responses from investors.

The US rescue package follows five days of intense negotiations to try to agree a deal that will provide aid for American workers and businesses.

Before it becomes law the deal must get through the Republican-controlled Senate, the Democrat-controlled House of Representatives and be signed by President Trump.

The US central bank, the Federal Reserve has already announced $4tn in extra lending to help stimulate the economy in the face of the coronavirus.

Last week, Treasury Secretary Steve Mnuchin predicted that US unemployment could reach 20%. On Thursday, the Treasury Department will release last week's new jobless claims, and the numbers are expected to be in the millions.

A Goldman Sachs report estimated that the nation's gross domestic product in the second quarter could shrink by 24%, dwarfing the previous 10% record decline in 1958.

Global spread

America is more than midway through a 15-day attempt to slow the spread of the virus through social distancing.

Nearly 19,000 people have died with coronavirus across the planet since it emerged in China's Wuhan province in January, and more than 420,000 infections have been confirmed.

Southern Europe is now at the centre of the pandemic, with Italy and Spain recording hundreds of new deaths every day.

Governments around the world have responded by locking down societies in the hope of slowing the spread of the virus.