Business News 7th September 2017
CPA hopes to inform, with its daily bite-size business news on Thursday 7th September 2017, filled with stories we think will interest Business people.
Markets Round up
The FTSE 100 recovered yesterday from earlier losses to close down 18.8 points (0.3%) at 7354, having traded as low as 7322.42. The FTSE 250 fell 0.4% to 19,652.3. European stocks faired better with the Euro Stoxx 50 climbing 0.4% to 3433.8 with stocks rising in it Germany, France and Italy. US stock markets rebounded following tuesday’s sell off, as investors ignored the geopolitical fears that have dogged equities this week. Gains were limited, boosted by energy shares and helped by news of an agreement to extend the debt limit. However investors kept an eye on potentially destructive Hurricane Irma. The S&P500 & Nasdaq both climbed 0.3% to 2465.5 and 6393.3 respectively. The Bank of Canada this afternoon unexpectedly raised interest rates, for the second time this year, to 1%, brushing off inflation concerns. According to reports. Downing Street has asked Britain’s biggest companies to give public support to the Government’s approach to its Brexit negotiations, a move which has provoked fury in a string of blue-chip boardrooms. Asian stock markets were mostly higher following the overnight gains on Wall Street after U.S. President Donald Trump agreed to support a short-term measure that would raise the debt ceiling and fund the government for three months. The Japanese Topix and Nikkei were up 0.4% and 0.2%. The Korean Kospi climbed 1.1%, Australia was flat India was up 0.25% but Chinese (-0.5%) and Hong Kong (-0.3%) shares fell.
Oil prices rose to a three-week high as key refineries and pipelines restarted from shutdowns forced by Hurricane Harvey, reviving crude demand before dipping over fears that Hurricane Irma in the Caribbean could interrupt crude shipments in and out of the United States, and as Libyan output began to recover from disruptions.
Gold managed a slim gain, keeping the perceived haven metal pinned near its best level in nearly a year boosted by a weaker dollar and doubts over whether the Federal Reserve will raise interest rates a third time this year.
Blip in Yorkshire as UK’s SME sector thrives
Figures compiled by the Centre for Economics and Business Research (Cebr) and CYBG show Yorkshire was the only region in the country to see a decline in the health of its SME sector. The SME Health Check Index showed capacity, confidence and employment levels all taking a hit during the second quarter of this year. The figures for the region contrast with the national picture which shows the health of Britain’s SME sector to be at its highest level in 18 months. But the Cebr’s Oliver Kolodseike said that performance had to be measured against an exceptionally good first quarter. He said: “It is a slight drop and nothing major. The economy of the region is robust.”
IoD calls for tax-free pension access to entrepreneurial retirees
The Institute of Directors says the government should consider allowing retirees tax-free access their pensions to fund their own startups. The institute has put forward the idea after its report, The Age of the Older Entrepreneur, found that 53% of its members over the age of 50 identified themselves as entrepreneurs. Institute chair Barbara Judge said that many business people had experience that could lead to many more years of productive work. “The government should consider introducing tax incentives to encourage people to pursue their ideas and invest in training, so that they can continue to have fulfilling working lives beyond the age expected by previous generations,” she said.
The Times, Page: 51
US Debt limit
President Trump sided with congressional Democrats led by Senator Chuck Schumer and House Minority Leader Nancy Pelosi on a three-month extension of the U.S. debt limit and government funding as part of aid for Hurricane Harvey, overruling Republicans who wanted a longer deal. Trump called the agreement “very good” hours after House Speaker Paul Ryan rejected the proposal.
R&D support grants bring exceptional returns
The Enterprise Research Centre has found that R&D grants have boosted the economy by £43bn, returning £5 for every £1 of taxpayer support. The study found that employment at recipient businesses grew 23% faster compared to other companies while those who received the created an estimated 150,000 new jobs in areas including biotechnology, medical equipment, engineering, life sciences and advanced manufacturing. Stephen Roper, director of the research centre, said: “The greatest impact seems to be on smaller manufacturing businesses, which see the biggest boost to growth and productivity, helping them to catch up with more established firms.”
The Times, Page: 51
Workers adapt to thrive
A new study has revealed that 74% of people are ready to learn a new skill or completely retrain to keep themselves employable. The findings are from PwC’s latest report, Workforce of the future: the competing forces shaping 2030, which includes findings from a survey of 10,000 people across the UK, Germany, China, India and the US. Their views reinforce a shift to continuous learning while earning, so employees can keep up with technology’s impact on jobs and the workplace. According to the report, the majority of respondents believe technology will improve their job prospects (65%) although workers in the US (73%) and India (88%) are more confident than those in the UK (40%) and Germany (48%). Overall, nearly three quarters believe technology will never replace the human mind (73%) and the majority (86%) say human skills will always be in demand.
ONS retail sales figures delayed by IT issues
The Office for National Statistics has been hit by further IT problems, causing it to delay the publication of UK retail sales data scheduled for later this month. An ONS spokesman said the body had been hit by “computer problems” that were specific to the retail data set, adding there was “no reason to suspect any other data will be affected”. Sir Charlie Bean, the former deputy governor of the Bank of England, said the ONS’s statistics “have failed to keep pace with the impact of digital technology”.
US Services
Activity in the US services sector improved a little less than expected in August, according to figures released on Wednesday. The Institute for Supply Management’s index of non-manufacturing rose to 55.3 from 53.9 the month before, falling short of consensus expectations for a reading of 55.6. A reading above 50 indicates expansion, while a reading below signals contraction. Meanwhile, the non-manufacturing business activity index rose to 57.5 from July’s 55.9, reflecting growth for the 97th consecutive month.
Brexit
The Brexit wheels are in motion and the Repeal Bill will have its first airing in the House of Commons today as MPs hold a debate. While the Conservative leadership has called on its party to show support for the bill, it has been reported that Labour has imposed a three-line whip on its MPs to vote against it, arguing the paper is a power-grabbing exercise by the Government.
South Korea
South Korea will allow the installation of four anti-ballistic missile launchers Thursday at a US base operating in the country, as military safeguards are boosted in the wake of North Korea’s most powerful nuclear test to date. US Forces Korea will position the Terminal High Altitude Area Defence (THAAD) launchers at a base in Seongju, about 300 kilometres south of Seoul, the Yonhap news agency reported Wednesday, citing South Korea’s Defence Ministry. They will be in addition to THAAD launchers that have been installed in South Korea since March, to the objection of China and North Korea. Xi Jinping and Trump spoke about the North Korean crisis as the U.S. seeks support for tougher UN sanctions on Sept. 11. America is circulating a draft resolution that would embargo oil and freeze Kim Jong Un’s personal assets, people familiar said.
Canada
The Bank of Canada raised its benchmark rate unexpectedly following recent stronger-than-expected economic data. The BoC upped its key interest rate to 1% from 0.75%. Economists had forecast the rate to remain unchanged. In its accompanying statement, the BoC noted that the recent economic data had been stronger than expected, supporting the Bank’s view that growth in Canada is becoming more broadly-based and self-sustaining.
Irma
Hurricane Irma hit several Caribbean islands with pounding winds, rain and surging tides as officials in Florida called for evacuations ahead of the storm’s expected landfall there this weekend. The eye of Irma, a Category 5 storm with winds of 185 miles per hour, was passing over the northernmost Virgin Islands on Wednesday afternoon after crossing the island of St. Martin. On its current path the core of Irma, which is currently the strongest Atlantic storm on record, passed near Puerto Rico before touching the north coast of the Dominican Republic later today. “First information indicates that a lot of damage has been done (to St. Martin), but communication is still extremely difficult,” Karel van Oosterom, the Netherlands ambassador to the United Nations, said.
ECJ & Refugees
The EU’s highest court ruled on Wednesday that member states must take in a share of refugees who reach Europe, dismissing complaints by Slovakia and Hungary and reigniting an east-west row that has shaken the Union’s cohesion. The Mediterranean migrant crisis which prompted mandatory quotas in 2015 for relocating asylum seekers from Greece and Italy has receded, easing immediate pressure to force compliance on nationalist leaders who are unhappy with Brussels. In Hungary, where outspoken Prime Minister Viktor Orban has built border fences and made keeping out migrants a key pillar of his re-election campaign for next year, branded the European Court of Justice ruling “appalling and irresponsible”.
Robot Accountants
Deutsche Bank CEO John Cryan has said a large number of the bank’s staff will lose their jobs to robots in the future. He singled out accountants, who he said spent “a lot of time basically being an abacus” but could better use their time analysing numbers in the future rather than generating them.
EU to consider tax rule changes for online giants
A document seen by Reuters indicates that EU officials are to meet next week to discuss new tax rules for digital multinationals such as Google and Amazon. The document proposes a reform of international tax rules to change the concept of “permanent establishment” so that digital multinationals could be taxed where they create value, and not only in countries where they have established their tax residence.
Daily Mail
Bell Pottinger sale confirmed
Bell Pottinger is up for sale after losing clients since being expelled from the industry trade body for a campaign stirring racial divisions in South Africa. BDO will try to find a buyer for the company, which employs 250 people across its offices in London, Asia and the Middle East.
BBC News
Or see our recent previous news pages
Business News 6th September 2017
Business News 5th September 2017
Business News 4th September 2017
Business News 1st September 2017
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