cityam--2020-07-09--FTSE 100 falls as coronavirus cases overshadow Sunak stimulus

The FTSE 100 lost one and a half per cent today as fears over a continued rise in coronavirus cases offset chancellor Rishi Sunak ’ s £30bn of extra financial firepower .
The UK index initially barely moved after yesterday ’ s 0.55 per cent drop , which left it at 6,156 points .
By 4pm today the FTSE 100 had fallen 1.61 per cent to 6057 points , dented despite the chancellor ’ s promise of up to £9.4bn to help bring furloughed staff back into the workforce .
Read more : Rishi Sunak Summer Statement : All the @ @ @ @ @ @ @ retail stocks proved the main beneficiaries yesterday after Sunak pledged to slash stamp duty to zero on properties below £500,000 and cut VAT to five per cent on certain hospitality services .
But the FTSE 100 was weighed down as cases escalated around the world yesterday .
“ Traders in this part of the world continue to monitor the situation in the US , where the majority of states continue to see the number of new Covid-19 cases increase , ” David Madden , market analyst at CMC Markets , said .
“ @ @ @ @ @ @ @ confirmed cases in the US exceeded 3m .
On Tuesday , the WHO cautioned there could be an increase in the fatality rate as there has been a rise in infections , but the death rate so far has lagged.
” While housebuilders performed well following yesterday ’ s stamp duty cut , banks , tobacco stocks and dragged the index lower .
“ Despite pushing ahead at the market open , the FTSE 100 couldn ’ t keep up the momentum and quickly dipped into negative territory , ” said AJ Bell @ @ @ @ @ @ @ the first hour of trading the FTSE 100 was 0.2 per cent lower .
In comparison , the mid-cap FTSE 250 index managed to press ahead… thanks to a strong showing from retailers and builders ’ merchants including Marks & Spencer , Travis Perkins and Games Workshop.
” While the FTSE 100 fell 0.5 per cent , European stocks managed to ride considerably higher .
Germany ’ s Dax surged 1.5 per cent after software giant SAP outperformed guidance in the first quarter of 2020 .
And France ’ s Cac eked out @ @ @ @ @ @ @ the Euro Stoxx 600 climbed 0.44 per cent .
Chris Beauchamp , chief market analyst at spreadbetter IG , called it “ a day of drift and indecision for markets ” – partly down to a lack of economic or financial data .
“ European markets have made gains however , taking their cue from the broadly positive session for Asia overnight , ” he added .
The Nikkei and Hang Seng rose 0.4 per cent and 0.3 per cent respectively .
Sunak ’ s Summer Statement made big political headlines yesterday as @ @ @ @ @ @ @ £9.4bn to bring back furloughed workers , amid a £30bn pledge to bolster the UK economy .
A temporary cut to VAT for tourism and hospitality to just five per cent , and a promise to pay part of diners ’ bills at restaurants throughout August , is hoped to boost some of the worst hit sectors of the economy .
But traders appeared more concerned with huge spikes in cases in the US and Brazil , where President Bolsonaro has contracted Covid-19 .
Overnight three US states saw a huge rise in @ @ @ @ @ @ @ record 60,000 cases in a single day .
There were 10,000 new cases in Florida , while Texas reported over 9,500 cases and California reported more than 8,500 new infections .
Read more : VAT rate cut : implementation for businesses will be more complicated than it appears A rise in cases in Hong Kong has added to the growing list of places where the virus has seen a resurgence , although for the time being indices are content to hold their ground , avoiding much downside for the time being.
” Hong @ @ @ @ @ @ @ Sunday , with its head of communicable disease branch warning the city could see another “ major outbreak ” .
“ There could be a sudden exponential growth of cases , ” Dr. Chuang Shuk-kwan said today .
Analysts said the numbers have spooked the FTSE 100 as the UK reopens .
“ Providing help to the battered hospitality sector is a sensible move , but people in the UK might be cautious about socialising given what has happened in places like Melbourne and the US in relation to a rise in new @ @ @ @ @ @ @ , the huge cut to stamp duty , active until 31 March 2021 , may not be as effective as hoped given “ the huge economic uncertainty ” , he added .
Housebuilder Persimmon said customer demand has come back strongly in recent weeks as lockdowns are eased .
That buoyed housebuilder stocks today , sending Persimmon up over seven per cent .
Fellow housebuilder Vistry also climbed 2.7 per cent higher as it reported a jump in post-lockdown demand .
“ Both Persimmon and Vistry have gotten back to work , although @ @ @ @ @ @ @ social distancing measures have done to margins , ” Hargreaves Lansdown equity analyst William Ryder said .
“ In the absence of a second wave of coronavirus infections the costs of the lockdown are now behind us , but social distancing may hurt profitability over the longer term .
In any case , house prices are the key variable , and they ’ re out of the builders ’ hands.
” FTSE 100 stocks Barratt Homes and Taylor Wimpey each climbed almost three per cent higher .
However , the FTSE 100 fell @ @ @ @ @ @ @ sterling hurt the exporter-heavy index .
The pound climbed 0.33 per cent to $ 1.265 after Sunak ’ s pledge yesterday to continue to spend to safeguard the UK economy .
“ Yesterday ’ s statement from the chancellor confirms that the UK government is looking to keep providing stimulus in various forms , even if the amounts discussed on Wednesday are smaller than those seen earlier in the year , ” Beauchamp said .
Wall Street reversed gains it made yesterday after the US hit a record high daily figure of 62,000 @ @ @ @ @ @ @ million .
The benchmark S & P 500 dropped 1.3 per cent while the Dow Jones fell 1.67 per cent .
The tech-heavy Nasdaq was trading down 0.75 per cent by 4pm .
It came despite a better than forecast weekly jobless claims report , which came in at 1.314m compared to last week ’ s 1.413m .
“ Continuing claims dropped but are still at an eye-dropping 18 million level .
The recent wave of new coronavirus cases is not yet impacting the labor market yet and many investors are breathing a @ @ @ @ @ @ @ Edward Moya , Oanda ’ s senior market analyst .
Financial companies were among the worst performers on the benchmark S & P 500 as Wells Fargo prepared to cut thousands of jobs .
Oil remains anchored just below the $ 41 level after the jobless claims report seemed to suggest the economic recovery remains somewhat intact .
“ Oil seems ripe for a pullback here and if the demand outlook shows further signs of faltering , WTI could settle back towards the mid- $ 30s , ” said Moya .

FTSE 100 falls as coronavirus cases overshadow Sunak stimulus
The FTSE 100 lost one and a half per cent today as fears over a continued rise in coronavirus cases offset chancellor Rishi Sunak’s £30bn of extra financial firepower.
The UK index initially barely moved after yesterday’s 0.55 per cent drop, which left it at 6,156 points.
By 4pm today the FTSE 100 had fallen 1.61 per cent to 6057 points, dented despite the chancellor’s promise of up to £9.4bn to help bring furloughed staff back into the workforce.
Housebuilder and retail stocks proved the main beneficiaries yesterday after Sunak pledged to slash stamp duty to zero on properties below £500,000 and cut VAT to five per cent on certain hospitality services.
But the FTSE 100 was weighed down as cases escalated around the world yesterday.
“Traders in this part of the world continue to monitor the situation in the US, where the majority of states continue to see the number of new Covid-19 cases increase,” David Madden, market analyst at CMC Markets, said.
“As of yesterday, the number of confirmed cases in the US exceeded 3m. On Tuesday, the WHO cautioned there could be an increase in the fatality rate as there has been a rise in infections, but the death rate so far has lagged.”
While housebuilders performed well following yesterday’s stamp duty cut, banks, tobacco stocks and dragged the index lower.
“Despite pushing ahead at the market open, the FTSE 100 couldn’t keep up the momentum and quickly dipped into negative territory,” said AJ Bell investment director Russ Mould.
“In the first hour of trading the FTSE 100 was 0.2 per cent lower. In comparison, the mid-cap FTSE 250 index managed to press ahead… thanks to a strong showing from retailers and builders’ merchants including Marks & Spencer, Travis Perkins and Games Workshop.”
European stocks outperform FTSE 100
While the FTSE 100 fell 0.5 per cent, European stocks managed to ride considerably higher.
Germany’s Dax surged 1.5 per cent after software giant SAP outperformed guidance in the first quarter of 2020.
And France’s Cac eked out a 0.26 per cent rise, while the Euro Stoxx 600 climbed 0.44 per cent.
Chris Beauchamp, chief market analyst at spreadbetter IG, called it “a day of drift and indecision for markets” – partly down to a lack of economic or financial data.
“European markets have made gains however, taking their cue from the broadly positive session for Asia overnight,” he added. The Nikkei and Hang Seng rose 0.4 per cent and 0.3 per cent respectively.
Record US cases overshadow Sunak’s stimulus
Sunak’s Summer Statement made big political headlines yesterday as he vowed to pay employers up to £9.4bn to bring back furloughed workers, amid a £30bn pledge to bolster the UK economy.
A temporary cut to VAT for tourism and hospitality to just five per cent, and a promise to pay part of diners’ bills at restaurants throughout August, is hoped to boost some of the worst hit sectors of the economy.
But traders appeared more concerned with huge spikes in cases in the US and Brazil, where President Bolsonaro has contracted Covid-19.
Overnight three US states saw a huge rise in coronavirus infections as the country posted a record 60,000 cases in a single day.
There were 10,000 new cases in Florida, while Texas reported over 9,500 cases and California reported more than 8,500 new infections.
A rise in cases in Hong Kong has added to the growing list of places where the virus has seen a resurgence, although for the time being indices are content to hold their ground, avoiding much downside for the time being.”
Hong Kong has diagnosed 65 new patients since Sunday, with its head of communicable disease branch warning the city could see another “major outbreak”.
“There could be a sudden exponential growth of cases,” Dr. Chuang Shuk-kwan said today.
Analysts said the numbers have spooked the FTSE 100 as the UK reopens.
“Providing help to the battered hospitality sector is a sensible move, but people in the UK might be cautious about socialising given what has happened in places like Melbourne and the US in relation to a rise in new cases,” Madden said.
Meanwhile, the huge cut to stamp duty, active until 31 March 2021, may not be as effective as hoped given “the huge economic uncertainty”, he added.
Housebuilders boosted despite FTSE 100 drop
Housebuilder Persimmon said customer demand has come back strongly in recent weeks as lockdowns are eased. That buoyed housebuilder stocks today, sending Persimmon up over seven per cent.
Fellow housebuilder Vistry also climbed 2.7 per cent higher as it reported a jump in post-lockdown demand.
“Both Persimmon and Vistry have gotten back to work, although we’re yet to see what social distancing measures have done to margins,” Hargreaves Lansdown equity analyst William Ryder said.
“In the absence of a second wave of coronavirus infections the costs of the lockdown are now behind us, but social distancing may hurt profitability over the longer term. In any case, house prices are the key variable, and they’re out of the builders’ hands.”
FTSE 100 stocks Barratt Homes and Taylor Wimpey each climbed almost three per cent higher.
However, the FTSE 100 fell half a per cent overall, as sterling hurt the exporter-heavy index.
The pound climbed 0.33 per cent to $1.265 after Sunak’s pledge yesterday to continue to spend to safeguard the UK economy.
“Yesterday’s statement from the chancellor confirms that the UK government is looking to keep providing stimulus in various forms, even if the amounts discussed on Wednesday are smaller than those seen earlier in the year,” Beauchamp said.
Rise in cases hits US stocks
Wall Street reversed gains it made yesterday after the US hit a record high daily figure of 62,000, bringing the total cases to three million.
The benchmark S&P 500 dropped 1.3 per cent while the Dow Jones fell 1.67 per cent. The tech-heavy Nasdaq was trading down 0.75 per cent by 4pm.
It came despite a better than forecast weekly jobless claims report, which came in at 1.314m compared to last week’s 1.413m.
“Continuing claims dropped but are still at an eye-dropping 18 million level. The recent wave of new coronavirus cases is not yet impacting the labor market yet and many investors are breathing a temporary sigh of relief,” said Edward Moya, Oanda’s senior market analyst.
Financial companies were among the worst performers on the benchmark S&P 500 as Wells Fargo prepared to cut thousands of jobs.
Oil remains anchored just below the $41 level after the jobless claims report seemed to suggest the economic recovery remains somewhat intact.
“Oil seems ripe for a pullback here and if the demand outlook shows further signs of faltering, WTI could settle back towards the mid-$30s,” said Moya.


cityam--2020-07-09--Man arrested over £495,000 'furlough fraud'

A man has been arrested on suspicion of defrauding the government ’ s job retention scheme out of £495,000 .
The arrest , which is thought to be the first relating to the government ’ s furlough scheme , happened in Solihull in the West Midlands .
Computers were seized and funds were frozen in the man ’ s business bank account , according to HMRC .
He was also arrested , along with another eight men across the West Midlands , in relation to a separate suspected multimillion-pound tax fraud and alleged money laundering offences .
Jessica Parker , @ @ @ @ @ @ @ : “ This highly publicised arrest was decisive and strategic .
Through this action HMRC are sending a clear message to those who are tempted to take advantage of the Chancellor ’ s furlough package.
” “ It is likely that this action will be followed by a publicised amnesty for those who may have claimed furlough payments fraudulently and HMRC will expect that today ’ s arrest will encourage those who otherwise may have ‘ waited it out ’ to come forwards.
” “ Furlough fraud is rumoured to have been conducted @ @ @ @ @ @ @ s enforcement division will be planning a significant programme to counter it.
” The furlough scheme was introduced by the government at the start of lockdown to help mitigate the effect of coronavirus on businesses .
Read more : Pace of furloughing slows as cost of job support measures tops £33bn The scheme pays 80 per cent of salary costs for furloughed staff but this will fall to 70 per cent in September before the government winds down the scheme the following month .
Yesterday , Chancellor Rishi Sunak announced a job retention @ @ @ @ @ @ @ pay businesses £1,000 for every furloughed employee they bring back to work and keep employed until the end of January .
Get the news as it happens by following City A.M. on Twitter .

Man arrested over £495,000 ‘furlough fraud’
A man has been arrested on suspicion of defrauding the government’s job retention scheme out of £495,000.
The arrest, which is thought to be the first relating to the government’s furlough scheme, happened in Solihull in the West Midlands.
Computers were seized and funds were frozen in the man’s business bank account, according to HMRC. He was also arrested, along with another eight men across the West Midlands, in relation to a separate suspected multimillion-pound tax fraud and alleged money laundering offences.
Jessica Parker, partner at law firm Corker Binning said: “This highly publicised arrest was decisive and strategic. Through this action HMRC are sending a clear message to those who are tempted to take advantage of the Chancellor’s furlough package.”
“It is likely that this action will be followed by a publicised amnesty for those who may have claimed furlough payments fraudulently and HMRC will expect that today’s arrest will encourage those who otherwise may have ‘waited it out’ to come forwards.”
“Furlough fraud is rumoured to have been conducted on a large scale and HMRC’s enforcement division will be planning a significant programme to counter it.”
The furlough scheme was introduced by the government at the start of lockdown to help mitigate the effect of coronavirus on businesses.
The scheme pays 80 per cent of salary costs for furloughed staff but this will fall to 70 per cent in September before the government winds down the scheme the following month.
Yesterday, Chancellor Rishi Sunak announced a job retention bonus scheme which will see the government pay businesses £1,000 for every furloughed employee they bring back to work and keep employed until the end of January.
Get the news as it happens by following City A.M. on Twitter.


cityam--2020-07-09--Financial services sector banks on a digital future

“ We know you enjoy a little trip into town , but you can do your banking online these days… ” : a typical multi-generational conversation as a growing number of people turn to online tools to help with their finances .
Inevitably it ’ s not been a smooth journey .
Many find comfort in the familiarity of a bricks-and-mortar bank branch and the sense of security this imbues .
But times and attitudes are changing .
Younger people are often more comfortable than older generations at using digital means for both everyday banking and exploring the increasing number @ @ @ @ @ @ @ has accelerated this , with established banks pushing yet more firmly on their prompting to stay away from high-street branches .
This should be – and is – a terrific opportunity for the financial technology ( ‘ fintech ’ ) sector to win customers and credibility .
A webinar convened today by communications agency Brands2Life took up precisely this theme : has a ‘ tipping point ’ has been reached for the creation of long-term trust in financial services and fintech ?
The question is important for UK Plc , which is seen @ @ @ @ @ @ @ championing ‘ open banking ’ , the global trend facilitating the industry .
City AM reported earlier this year that British fintech companies attracted a record £37.4bn of investment in 2019 , up 91 per cent from the previous year .
Digital-only banking brands such as Monzo and Revolut have gained significant traction , particularly among a younger demographic ; and a growing number of apps – at time of writing , 75 – are available on an ‘ app store ’ recently launched by the UK ’ s Open Banking Implementation Entity @ @ @ @ @ @ @ during the past fortnight as the reverberations of the scandal at Germany-headquartered company , Wirecard , hit the UK .
The Financial Conduct Authority stepped in to instruct the company ’ s UK operation to cease all regulated activities after its parent operation had disclosed a €1.9bn black hole in its accounts .
After a panicked weekend for customers , the FCA ban was lifted .
But there is concern about the reputational damage on fintechs in general , both from a consumer and investor perspective .
“ This will affect trust because @ @ @ @ @ @ @ a failure , for whatever reason , there ’ s a trickle-down effect , ” said Pinar Ozcan , professor of entrepreneurship and innovation at Oxford University ’ s Saïd Business School , during the webinar .
Moving more quickly on the fintech journey The investment challenge is also growing because of coronavirus ’ s impact .
Analysis on the current economics of the often venture capital-backed fintech market is mounting up .
Newer companies , inevitably , are seen as particularly vulnerable .
But nonetheless , companies talk of a speeding-up of @ @ @ @ @ @ @ services companies seek customers , credibility and funding , established brands continue to evolve their own propositions towards digital delivery and engagement .
Vicki Harris , chief commercial officer at Kensington Mortgages , said the firm , which partners various fintechs , had been “ moving quicker in respect of what partnerships we want to develop ” during the pandemic .
“ We had been very open to working with fintechs before this [ pandemic ] happened , and are even more so now , ” she said .
In terms of consumer @ @ @ @ @ @ @ to get people on board , with many hesitant about sharing their personal financial data by digital means and with newer market entrants .
“ We have seen a massive acceleration in the use of digital processes over the past three months and hopefully that will lead to more people being willing to use digital services , ” said Harris .
“ I think the pandemic will accelerate that .
But certain segments of the population are not going to do that overnight.
” Beyond attracting new customers , newer banks ’ greatest @ @ @ @ @ @ @ they are seen by users as a secondary account , with fundamental payments ( such as salaries ) continuing to run into a ‘ main ’ account with an established high-street bank .
“ Some are clearly targeting millennials , speaking back [ with customers ] in emojis – very new-age – whereas others are very much trying to be a traditional , serious bank to get [ customers ] to completely switch over , ” said Ozcan .
Twists and turns await .
But the direction of travel remains in fintech ’ @ @ @

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Financial services sector banks on a digital future
Getty images
“We know you enjoy a little trip into town, but you can do your banking online these days…”: a typical multi-generational conversation as a growing number of people turn to online tools to help with their finances.
Inevitably it’s not been a smooth journey. Many find comfort in the familiarity of a bricks-and-mortar bank branch and the sense of security this imbues. But times and attitudes are changing. Younger people are often more comfortable than older generations at using digital means for both everyday banking and exploring the increasing number of financial services smart-phone apps. Lockdown has accelerated this, with established banks pushing yet more firmly on their prompting to stay away from high-street branches.
This should be – and is – a terrific opportunity for the financial technology (‘fintech’) sector to win customers and credibility. A webinar convened today by communications agency Brands2Life took up precisely this theme: has a ‘tipping point’ has been reached for the creation of long-term trust in financial services and fintech?
UK leadership amid ‘trust’ challenges
The question is important for UK Plc, which is seen as a worldwide leader in fintech and championing ‘open banking’, the global trend facilitating the industry.
City AM reported earlier this year that British fintech companies attracted a record £37.4bn of investment in 2019, up 91 per cent from the previous year.
Digital-only banking brands such as Monzo and Revolut have gained significant traction, particularly among a younger demographic; and a growing number of apps – at time of writing, 75 – are available on an ‘app store’ recently launched by the UK’s Open Banking Implementation Entity.
But consumer-confidence challenges jolted into prominence during the past fortnight as the reverberations of the scandal at Germany-headquartered company, Wirecard, hit the UK. The Financial Conduct Authority stepped in to instruct the company’s UK operation to cease all regulated activities after its parent operation had disclosed a €1.9bn black hole in its accounts. After a panicked weekend for customers, the FCA ban was lifted. But there is concern about the reputational damage on fintechs in general, both from a consumer and investor perspective.
“This will affect trust because when one part of the ecosystem has a failure, for whatever reason, there’s a trickle-down effect,” said Pinar Ozcan, professor of entrepreneurship and innovation at Oxford University’s Saïd Business School, during the webinar.
Moving more quickly on the fintech journey
The investment challenge is also growing because of coronavirus’s impact. Analysis on the current economics of the often venture capital-backed fintech market is mounting up. Newer companies, inevitably, are seen as particularly vulnerable.
But nonetheless, companies talk of a speeding-up of their fintech journey. As digital financial services companies seek customers, credibility and funding, established brands continue to evolve their own propositions towards digital delivery and engagement.
Vicki Harris, chief commercial officer at Kensington Mortgages, said the firm, which partners various fintechs, had been “moving quicker in respect of what partnerships we want to develop” during the pandemic. “We had been very open to working with fintechs before this [pandemic] happened, and are even more so now,” she said.
Targeting millennials? Try an emoji
In terms of consumer take-up, it’s not easy to get people on board, with many hesitant about sharing their personal financial data by digital means and with newer market entrants.
“We have seen a massive acceleration in the use of digital processes over the past three months and hopefully that will lead to more people being willing to use digital services,” said Harris. “I think the pandemic will accelerate that. But certain segments of the population are not going to do that overnight.”
Beyond attracting new customers, newer banks’ greatest hurdle is, Ozcan said, that they are seen by users as a secondary account, with fundamental payments (such as salaries) continuing to run into a ‘main’ account with an established high-street bank.
“Some are clearly targeting millennials, speaking back [with customers] in emojis – very new-age – whereas others are very much trying to be a traditional, serious bank to get [customers] to completely switch over,” said Ozcan.
Twists and turns await. But the direction of travel remains in fintech’s favour.


cityam--2020-07-09--Crypto exchange Coinbase aims for Wall Street listing

Coinbase , one of the world ’ s largest cryptocurrency exchanges , is said to be preparing to publicly list its shares in New York .
The listing could come as early as this year , sources told Reuters .
Should its application be approved by US regulators , Coinbase would be the first major US cryptocurrency exchange to go public .
It would also mark a significant step forward for those advocating for cryptocurrencies to be recognised as securities by officials .
Read more : Coinbase becomes first crypto platform to receive Visa principal member status The US Securities @ @ @ @ @ @ @ said some coins may be recognised as securities , but most cryptocurrencies remain unregulated .
Global guidance on the cryptoassets sector remains vague , despite the sustained popularity of coins as tools for investing .
Many remain concerned about the potential for money laundering , as well as price volatility .
A source told Reuters that Coinbase , which was valued at more than $ 8bn in a private fundraising round in 2018 , is exploring going public via a direct listing instead of a traditional initial public offering ( IPO ) .
@ @ @ @ @ @ @ choice for tech firms considering going public in recent years , following the difficult debuts of Uber and Wework on Wall Street .
Read more : Peter Thiel ’ s Palantir confidentially files to go public In a direct listing , a company does not sell new shares and existing investors are not bound by restrictions on when they can sell off their holdings following the market debut Founded in 2012 , Coinbase has more than 35m users who trade in various coins such as bitcoin , ethereum and XRP .
Previous investors @ @ @ @ @ @ @ listing by Coinbase include the New York Stock Exchange , BBVA and former Citigroup chief executive Vikram Pandit .
A Coinbase spokesperson did not immediately respond to a request for comment .

Crypto exchange Coinbase aims for Wall Street listing
Coinbase, one of the world’s largest cryptocurrency exchanges, is said to be preparing to publicly list its shares in New York.
The listing could come as early as this year, sources told Reuters.
Should its application be approved by US regulators, Coinbase would be the first major US cryptocurrency exchange to go public.
It would also mark a significant step forward for those advocating for cryptocurrencies to be recognised as securities by officials.
The US Securities and Exchange Commission (SEC) has said some coins may be recognised as securities, but most cryptocurrencies remain unregulated.
Global guidance on the cryptoassets sector remains vague, despite the sustained popularity of coins as tools for investing. Many remain concerned about the potential for money laundering, as well as price volatility.
A source told Reuters that Coinbase, which was valued at more than $8bn in a private fundraising round in 2018, is exploring going public via a direct listing instead of a traditional initial public offering (IPO).
Direct listings have become a more popular choice for tech firms considering going public in recent years, following the difficult debuts of Uber and Wework on Wall Street.
In a direct listing, a company does not sell new shares and existing investors are not bound by restrictions on when they can sell off their holdings following the market debut
Founded in 2012, Coinbase has more than 35m users who trade in various coins such as bitcoin, ethereum and XRP.
Previous investors who could stand to gain from a listing by Coinbase include the New York Stock Exchange, BBVA and former Citigroup chief executive Vikram Pandit.
A Coinbase spokesperson did not immediately respond to a request for comment.


cityam--2020-07-10--UK government bond yields hit record low

Short-dated UK government bond yields hit new lows today as unprecedented interventions from the Bank of England combined with economic uncertainty to boost the gilt market .
The yield – which moves inversely to price – on the 2-year bond or gilt dropped to minus 0.122 per cent in morning trading before rebounding slightly .
The yield on the 5-year gilt dropped to minus 0.09 per cent before rising .
A negative yield on a bond means that investors who buy the government debt in the secondary market can expect to lose money if they hold it until it matures @ @ @ @ @ @ @ yields have become common across Europe .
They have been driven by central banks slashing interest rates and creating money to hoover up bonds in a bid to boost economies during a decade of uncertainty .
Low yields means the UK government can borrow at record-low rates as it spends record amounts on fighting coronavirus .
The drop in yields this morning to record lows – also seen in the US 5-year Treasury – came as investors sold stocks in reaction to new coronavirus cases in the US and Hong Kong .
The @ @ @ @ @ @ @ coronavirus cases again yesterday , with more than 60,000 .
This has spooked investors , who fear it could derail the global economic recovery .
However , stock markets pared their losses in morning trading .
The UK ’ s FTSE 100 was last up xx per cent and US markets were set to open higher .
The fall in bond yields was largely driven by “ rising speculation that the Bank of England will cut rates into negative territory in September , ” said Michael Hewson , chief market analyst at trading @ @ @ @ @ @ @ cut makes bonds look more attractive , pushing their prices up and so their yields down .
“ While many are warning of the perils of going down this route there is a growing belief that the Bank of England could well do so in September .
”

UK government bond yields hit record low
The Bank of England has bought huge amounts of bonds during the coronavirus crisis
Short-dated UK government bond yields hit new lows today as unprecedented interventions from the Bank of England combined with economic uncertainty to boost the gilt market.
The yield – which moves inversely to price – on the 2-year bond or gilt dropped to minus 0.122 per cent in morning trading before rebounding slightly. The yield on the 5-year gilt dropped to minus 0.09 per cent before rising.
A negative yield on a bond means that investors who buy the government debt in the secondary market can expect to lose money if they hold it until it matures.
Negative yields have been driven by central banks slashing interest rates and creating money to hoover up bonds in a bid to boost economies during a decade of uncertainty.
They mean the UK government can borrow at record-low rates as it spends record amounts on fighting coronavirus.
The drop in yields this morning to record lows – also seen in the US 5-year Treasury – came as investors sold stocks in reaction to new coronavirus cases in the US and Hong Kong.
The fall in bond yields was also driven by “rising speculation that the Bank of England will cut rates into negative territory in September,” said Michael Hewson, chief market analyst at trading platform CMC Markets.
An interest rate cut makes bonds look more attractive, pushing their prices up and so their yields down.
“While many are warning of the perils of going down this route there is a growing belief that the Bank of England could well do so in September.”
The US reported a record number of new coronavirus cases again yesterday, with more than 60,000. This has spooked investors, who fear it could derail the global economic recovery.
However, stock markets pared their losses in morning trading. The UK’s FTSE 100 was last up 0.4 per cent although US markets were set to open lower.


cityam--2020-07-10--WHO warns coronavirus is accelerating as cases pass 12m

Coronavirus is not under control across the majority of the world , and is actually getting worse , according to the head of the World Health Organisation ( WHO ) Dr Tedros Adhanom Ghebreyesus .
He said the total number of cases of coronavirus worldwide has actually doubled in the last six weeks , adding that the spread of Covid-19 isn ’ t showing any signs of decline in the worst-affected countries including the US , Brazil and India .
Read more : US coronavirus cases rise by record 60,565 in single day Speaking at a member state briefing on @ @ @ @ @ @ @ “ The virus has upended health systems in some of the world ’ s wealthiest nations , while some countries that have mounted a successful response have been of modest means.
” “ We know that when countries take a comprehensive approach based on fundamental public health measures – such as find , isolate , test and treat cases , and trace and quarantine contacts – the outbreak can be brought under control.
” He went on to say “ But in most of the world the virus is not under control .
@ @ @ @ @ @ @ news comes as quarantine rules for those entering or exiting the UK from 59 countries were today relaxed .
Ghebreyesus warned : “ The pandemic is still accelerating.
” He cited 11.8m coronavirus cases across the world .
Today the number was closer to 12.3m and 555,486 deaths .
President Donald Trump has cut ties with the WHO after accusing it of failing to respond promptly enough to the coronavirus pandemic .
The warning from the World Health Organisation comes soon after President Trump moved to officially withdraw the US from WHO .
@ @ @ @ @ @ @ focus to prevent a second wave of infections , the US , Brazil and India are still struggling to contain their first waves and currently account for the majority of new Covid-19 cases reported daily .
The US has become the worst affected country by the pandemic , with more than 3m confirmed cases , accounting for over a quarter of the worldwide count .
This means that nearly one in every 100 Americans has been confirmed as infected with the virus .
The country now accounts for 131,000 of the 555,000 worldwide @ @ @ @ @ @ @ daily number of Covid-19 cases topped 60,000 , while Brazil reported nearly 45,000 and India nearly 25,000 new cases .
Tokyo has also seen a rise in cases , prompting concern that Japan may be experiencing a second wave of the virus .
Tokyo governor Yuriko Koike said : “ It ’ s a wake-up call .
We need to use extra caution against the further spread of the infections.
” Read more : Hong Kong shuts all schools after local coronavirus cases spike Additionally , Hong Kong has closed all schools once @ @ @ @ @ @ @ in infections .
Officials in other European countries , including that of France and Greece , have warned of the risk of new flare-ups due to social distancing guidelines being ignored .
In the UK , a spike in infections in Leicester caused the city to be sent back into a localised lockdown .

WHO warns coronavirus is accelerating as cases pass 12m
Coronavirus is not under control across the majority of the world, and is actually getting worse, according to the head of the World Health Organisation (WHO) Dr Tedros Adhanom Ghebreyesus.
Coronavirus is not under control across the majority of the world, and is actually getting worse, according to the head of the World Health Organisation (WHO) Dr Tedros Adhanom Ghebreyesus.
He said the total number of cases of coronavirus worldwide has actually doubled in the last six weeks, adding that the spread of Covid-19 isn’t showing any signs of decline in the worst-affected countries including the US, Brazil and India.
Speaking at a member state briefing on the pandemic yesterday, Ghebreyesus noted: “The virus has upended health systems in some of the world’s wealthiest nations, while some countries that have mounted a successful response have been of modest means.”
“We know that when countries take a comprehensive approach based on fundamental public health measures – such as find, isolate, test and treat cases, and trace and quarantine contacts – the outbreak can be brought under control.”
He went on to say “But in most of the world the virus is not under control. It is getting worse”.
The news comes as quarantine rules for those entering or exiting the UK from 59 countries were today relaxed.
Ghebreyesus warned: “The pandemic is still accelerating.” He cited 11.8m coronavirus cases across the world. Today the number was closer to 12.3m and 555,486 deaths.
President Donald Trump has cut ties with the WHO after accusing it of failing to respond promptly enough to the coronavirus pandemic.
The warning from the World Health Organisation comes soon after President Trump moved to officially withdraw the US from WHO.
While most countries have now moved their focus to prevent a second wave of infections, the US, Brazil and India are still struggling to contain their first waves and currently account for the majority of new Covid-19 cases reported daily.
The US has become the worst affected country by the pandemic, with more than 3m confirmed cases, accounting for over a quarter of the worldwide count. This means that nearly one in every 100 Americans has been confirmed as infected with the virus. The country now accounts for 131,000 of the 555,000 worldwide deaths.
The US’s latest daily number of Covid-19 cases topped 60,000, while Brazil reported nearly 45,000 and India nearly 25,000 new cases.
Tokyo has also seen a rise in cases, prompting concern that Japan may be experiencing a second wave of the virus.
Tokyo governor Yuriko Koike said: “It’s a wake-up call. We need to use extra caution against the further spread of the infections.”
Additionally, Hong Kong has closed all schools once again in response to a recent spike in infections.
Officials in other European countries, including that of France and Greece, have warned of the risk of new flare-ups due to social distancing guidelines being ignored.
In the UK, a spike in infections in Leicester caused the city to be sent back into a localised lockdown.


cityam--2020-07-10--Tesla nears record for first stock to reach $20bn short interest

Tesla is nearing a milestone as the first stock to ever reach $ 20bn in shorted shares , as its share price continues to rally .
Data from S3 Partners released after markets closed yesterday showed Tesla reached a short-interest level of $ 19.2bn , climbing as high as $ 19.95bn at one point .
S3 analyst Ihor Dusaniwsky said yesterday Tesla may also be in line for a short squeeze , where short-sellers are unable to continue betting on the share price to fall due to the stock ’ s gain — in turn forcing the share price even @ @ @ @ @ @ @ than 230 per cent this year alone , closing markets yesterday up two per cent at $ 1,394.28 .
The electric carmaker ’ s market capitalisation has risen almost 25 per cent in just over a week , jumping by about $ 50bn to surpass $ 250bn .
It is now the world ’ s most valuable carmaker , and roughly equals the values of Toyota , Ford , General Motors and Fiat Chrysler combined .
Tesla ’ s chief executive Elon Musk this week teased those betting against the stock by releasing @ @ @ @ @ @ @ shorts ” on Tesla ’ s online marketplace .
The shorts retail for $ 69.42 , in reference to the memes associated with the numbers 69 and 420 .
Read more : Tesla surpasses Toyota to become world ’ s most valuable carmaker The carmaker is also set to join the tech-heavy S & P 500 index for the first time , if it reports a profit in its quarterly results on 22 July .
It would mark Tesla ’ s fourth consecutive quarterly profit , a key requirement for addition to the @ @ @ @ @ @ @ be among the most valuable companies ever added to the S & P 500 , larger than 95 per cent of the index ’ s existing members .
It would have a major impact on investment funds that track the index .

Tesla nears record for first stock to reach $20bn short interest
Elon Musk’s human-computer interface company, Neuralink puts chips in animals’ brains
Tesla is nearing a milestone as the first stock to ever reach $20bn in shorted shares, as its share price continues to rally.
Data from S3 Partners released after markets closed yesterday showed Tesla reached a short-interest level of $19.2bn, climbing as high as $19.95bn at one point.
S3 analyst Ihor Dusaniwsky said yesterday Tesla may also be in line for a short squeeze, where short-sellers are unable to continue betting on the share price to fall due to the stock’s gain — in turn forcing the share price even higher.
Tesla shares have risen more than 230 per cent this year alone, closing markets yesterday up two per cent at $1,394.28.
The electric carmaker’s market capitalisation has risen almost 25 per cent in just over a week, jumping by about $50bn to surpass $250bn. It is now the world’s most valuable carmaker, and roughly equals the values of Toyota, Ford, General Motors and Fiat Chrysler combined.
Tesla’s chief executive Elon Musk this week teased those betting against the stock by releasing a line of red satin “short shorts” on Tesla’s online marketplace.
The shorts retail for $69.42, in reference to the memes associated with the numbers 69 and 420.
The carmaker is also set to join the tech-heavy S&P 500 index for the first time, if it reports a profit in its quarterly results on 22 July.
It would mark Tesla’s fourth consecutive quarterly profit, a key requirement for addition to the index.
At $250bn Tesla would be among the most valuable companies ever added to the S&P 500, larger than 95 per cent of the index’s existing members. It would have a major impact on investment funds that track the index.


cityam--2020-07-10--‘I was mistaken for a cleaner’, says Gina Miller

Investment manager and Brexit campaigner Gina Miller has revealed she was mistaken for a cleaner at a City of London event because of the colour of her skin .
Miller , who grew up in Guyana and was named the UK ’ s most influential black person in 2017 , said it is “ extraordinary how those biases are still there ” .
Read more : Gina Miller calls for review of Andrew Bailey ’ s Bank of England role after ‘ toxic ’ FCA tenure Speaking to entrepreneur podcast “ Can I ask you a personal question ?
” @ @ @ @ @ @ @ I ’ ve been ] mistaken for the secretary – or the cleaner quite often.
” She recalled leaving the toilets at an event at a big City firm , “ and this woman sort of came up to me who was from the firm , you know , one of the directors .
And she sort of said , ‘ Oh , we ’ ve run out of toilet paper.
’ And I said , ‘ Sorry ?
’ She said , ‘ You ’ re the cleaner , aren ’ t @ @ @ @ @ @ @ ‘ No , actually , I ’ m one of your guests this evening.
” Miller touched on the Black Lives Matter movement , which has gathered momentum in the past month following the murder of George Floyd , an unarmed black man , by four Minneapolis policemen .
“ Things that have happened over the years , I suppose , could be categorised as : Oh , but we didn ’ t think you would be in that position , ” she said .
“ So I couldn ’ t be bright @ @ @ @ @ @ @ of colour , to be there.
” Miller , who is a founding partner of wealth manager SCM Direct , also spoke about the challenges female entrepreneurs face when seeking access to finance .
“ If you look at the incredibly small number of women , or female-led , or female-only companies who get access to VC , private equity – both in the US and the UK , actually – it is shamefully low , ” she said .
Read more : Gina Miller to appeal as High Court rejects legal case @ @ @ @ @ @ @ her agency in the 1990s , she recalls being told she would have more success if she had a male chief executive “ so people lending you money have more faith in your business.
” “ Access to finance is a real problem for women , and it still is now today , ” Miller said .
“ Women still tell me that banks and financiers have that conversation with them , and will ask them very inappropriate questions.
” You can listen to the podcast episode in full here .

‘I was mistaken for a cleaner’, says Gina Miller
(Photo: TOLGA AKMEN/AFP via Getty Images)
Investment manager and Brexit campaigner Gina Miller has revealed she was mistaken for a cleaner at a City of London event because of the colour of her skin.
Miller, who grew up in Guyana and was named the UK’s most influential black person in 2017, said it is “extraordinary how those biases are still there”.
Speaking to entrepreneur podcast “Can I ask you a personal question?” Miller said: “Very often [I’ve been] mistaken for the secretary – or the cleaner quite often.”
She recalled leaving the toilets at an event at a big City firm, “and this woman sort of came up to me who was from the firm, you know, one of the directors. And she sort of said, ‘Oh, we’ve run out of toilet paper.’ And I said, ‘Sorry?’ She said, ‘You’re the cleaner, aren’t you?’ And I said, ‘No, actually, I’m one of your guests this evening.”
Miller touched on the Black Lives Matter movement, which has gathered momentum in the past month following the murder of George Floyd, an unarmed black man, by four Minneapolis policemen.
“Things that have happened over the years, I suppose, could be categorised as: Oh, but we didn’t think you would be in that position,” she said. “So I couldn’t be bright enough, successful enough as a woman of colour, to be there.”
Miller, who is a founding partner of wealth manager SCM Direct, also spoke about the challenges female entrepreneurs face when seeking access to finance.
“If you look at the incredibly small number of women, or female-led, or female-only companies who get access to VC, private equity – both in the US and the UK, actually – it is shamefully low,” she said.
When she launched her agency in the 1990s, she recalls being told she would have more success if she had a male chief executive “so people lending you money have more faith in your business.”
“Access to finance is a real problem for women, and it still is now today,” Miller said. “Women still tell me that banks and financiers have that conversation with them, and will ask them very inappropriate questions.”
You can listen to the podcast episode in full here.


cityam--2020-07-10--Nicola Sturgeon talks a good game, but Scottish independence would be a catastrophe

For everything Boris Johnson does , you can be certain Nicola Sturgeon will announce something different .
While Boris blusters , Nicola states clearly and simply why and how her policies to protect Scotland are going to happen .
Where Boris is distracted , she is focused .
She ’ s a highly effective politician , who misses no opportunity to distance Scotland from England .
And she ’ s leading the SNP ’ s any-cost independence campaign towards an inevitable second referendum .
Read more : Beauty salons , massage parlours and gyms set to reopen in England next @ @ @ @ @ @ @ having a very good pandemic .
I know that because my mother , in Edinburgh , previously dismissed her as a “ gallus wee-nyaff ” but is now a passionate supporter — not of the SNP , but of Nicola herself .
One of her grandkids recently asked rhetorically why we can ’ t have her as Prime Minister of the UK .
Sturgeon has successfully set a new narrative : everything wrong in Scotland is London ’ s fault — not her administration ’ s .
If her popularity continues to rise @ @ @ @ @ @ @ policies continue , she ’ s on course to win .
The SNP is single minded about restoring Scottish freedom after the English brutally crushed our rights and history in 1707 .
But the picture Sturgeon and her followers paint is about as accurate history as the film Braveheart portrayed — utter nonsense .
The Scottish nationalists don ’ t talk about how the Act of Union bailed out a bankrupt Scotland from financial disaster following the Darien Venture — our misguided and bungled attempt to build our own trading empire .
Instead @ @ @ @ @ @ @ , play the Jacobite card and fixate on the brutal crushing of the clans at Culloden , and neglect to mention that more Scots fought with Butcher Cumberland that day than against him .
They won ’ t discuss how the end of centuries of cold and hot wars between the nations allowed Edinburgh to become the prosperous epicentre of the eighteenth century enlightenment , the home of Adam Smith , the driving force of a new technological age in power , pharmacy and medicine , and how expatriate Scots became the shock @ @ @ @ @ @ @ mercantile success .
The union was great for Scotland , but the SNP blames London for everything — from the collapse of shipbuilding and the dismantling of Scottish industry , as thought it were Scotland alone that the Thatcher years blighted .
And as London has thrived in recent years , Scotland ’ s decline must be England ’ s fault — they argue .
They talk grandly of an independent Scotland assuming its place as a proud independent nation within the European Union .
It ’ s not entirely clear how replacing @ @ @ @ @ @ @ better .
Still , the battle rages on .
If you think the Brexit civil war has been bitter these past few years , it is nothing to the increasing angry sectarianism between unionist and independence supporters that already exists in Scotland .
The nationalists know the economics just don ’ t stack up — independence is apparently worth bankrupting the nation again .
They know Scotland depends on English remittances .
Left to its own devices , it will be left with a massive budget deficit to fund , and if it @ @ @ @ @ @ @ ( which the EU will insist upon as a term of membership ) the nation will have zero control of its currency .
As Italy and Greece have discovered , the shared currency means losing the ability to finance yourself out of crisis .
There are all kinds of rumours of how the EU is supporting Sturgeon .
She is said to be particularly close to the French , who historically have never ever missed an opportunity to be beastly to the English .
This is meant to be reassuring .
The SNP @ @ @ @ @ @ @ of other small independent nations like Norway and Ireland with the human capital and natural resources to succeed .
Again , a history lesson is needed .
What sank the Scots in the seventeenth century was navigation acts which forced Scottish vessels to pay customs in English ports , putting the nation at a massive disadvantage concerning the terms of trade .
A glance at the map will show that trade with Europe will have to go through England .
An independent Scotland will be needing that hard border with England again ( @ @ @ @ @ @ @ .
For the last 300 years , the Scots have done extraordinarily well from the union .
In return , Scotland provided much of the inventive and innovative brain power , plus the military and industrial muscle that fuelled the UK ’ s success .
At a time when the UK has a new opportunity post-Brexit to carve itself a new place in the global economy , why would Scotland choose to put itself in penury and become a statistical failure in the emerging European superstate ?
Read more : Boris Johnson must @ @ @ @ @ @ @ , build back the same

Nicola Sturgeon talks a good game, but Scottish independence would be a catastrophe
Nicola Sturgeon is having a very good pandemic.
For everything Boris Johnson does, you can be certain Nicola Sturgeon will announce something different.
While Boris blusters, Nicola states clearly and simply why and how her policies to protect Scotland are going to happen. Where Boris is distracted, she is focused. She’s a highly effective politician, who misses no opportunity to distance Scotland from England.
And she’s leading the SNP’s any-cost independence campaign towards an inevitable second referendum.
Scotland’s first minister is having a very good pandemic. I know that because my mother, in Edinburgh, previously dismissed her as a “gallus wee-nyaff” but is now a passionate supporter — not of the SNP, but of Nicola herself. One of her grandkids recently asked rhetorically why we can’t have her as Prime Minister of the UK.
Sturgeon has successfully set a new narrative: everything wrong in Scotland is London’s fault — not her administration’s. If her popularity continues to rise, and the effectiveness of her divisive policies continue, she’s on course to win.
The SNP is single minded about restoring Scottish freedom after the English brutally crushed our rights and history in 1707. But the picture Sturgeon and her followers paint is about as accurate history as the film Braveheart portrayed — utter nonsense.
The Scottish nationalists don’t talk about how the Act of Union bailed out a bankrupt Scotland from financial disaster following the Darien Venture — our misguided and bungled attempt to build our own trading empire. Instead, they talk angrily about English oppression, play the Jacobite card and fixate on the brutal crushing of the clans at Culloden, and neglect to mention that more Scots fought with Butcher Cumberland that day than against him.
They won’t discuss how the end of centuries of cold and hot wars between the nations allowed Edinburgh to become the prosperous epicentre of the eighteenth century enlightenment, the home of Adam Smith, the driving force of a new technological age in power, pharmacy and medicine, and how expatriate Scots became the shock economic troops of the UK’s mercantile success.
The union was great for Scotland, but the SNP blames London for everything — from the collapse of shipbuilding and the dismantling of Scottish industry, as thought it were Scotland alone that the Thatcher years blighted.
And as London has thrived in recent years, Scotland’s decline must be England’s fault — they argue. They talk grandly of an independent Scotland assuming its place as a proud independent nation within the European Union. It’s not entirely clear how replacing London with Brussels will make things any better.
Still, the battle rages on. If you think the Brexit civil war has been bitter these past few years, it is nothing to the increasing angry sectarianism between unionist and independence supporters that already exists in Scotland.
The nationalists know the economics just don’t stack up — independence is apparently worth bankrupting the nation again. They know Scotland depends on English remittances. Left to its own devices, it will be left with a massive budget deficit to fund, and if it takes the option of adopting the euro (which the EU will insist upon as a term of membership) the nation will have zero control of its currency. As Italy and Greece have discovered, the shared currency means losing the ability to finance yourself out of crisis.
There are all kinds of rumours of how the EU is supporting Sturgeon. She is said to be particularly close to the French, who historically have never ever missed an opportunity to be beastly to the English. This is meant to be reassuring.
The SNP argues that Scotland will match the success of other small independent nations like Norway and Ireland with the human capital and natural resources to succeed. Again, a history lesson is needed. What sank the Scots in the seventeenth century was navigation acts which forced Scottish vessels to pay customs in English ports, putting the nation at a massive disadvantage concerning the terms of trade. A glance at the map will show that trade with Europe will have to go through England. An independent Scotland will be needing that hard border with England again (time to buy cement and bricks).
For the last 300 years, the Scots have done extraordinarily well from the union. In return, Scotland provided much of the inventive and innovative brain power, plus the military and industrial muscle that fuelled the UK’s success.
At a time when the UK has a new opportunity post-Brexit to carve itself a new place in the global economy, why would Scotland choose to put itself in penury and become a statistical failure in the emerging European superstate?
Main image credit: Getty


cityam--2020-07-10--Carlsberg expects better than forecast profit as China trade bounces back

Danish brewer Carlsberg said today that it expects to suffer a smaller drop in profit than previously forecast after trade in China bounced back after the coronavirus lockdown .
The firm said it expects a nine per cent drop in operating profit in the second quarter compared to analyst forecasts of a 26 per cent decline .
Read more : Marston ’ s and Carlsberg to unite brewing operations in £780m joint venture Carlsberg , which is the world ’ s third largest brewer after Anheuser Busch InBev and Heineken , said second quarter sales fell 15 per cent with @ @ @ @ @ @ @ profit in China , the firm ’ s biggest market , “ rebounded strongly ” in the second quarter .
Carlsberg said that trading in Western Europe was difficult at the beginning of the quarter but reported “ improved performance ” towards the end as bars and restaurants reopened amid warm weather in June .
“ Although government lockdowns are gradually being lifted , the sales development across our regions in the coming months continues to be volatile and uncertain , not least during the important summer months , ” Carlsberg said .
@ @ @ @ @ @ @ to pub closures during lockdown The brewery giant kept its full-year guidance suspended .
“ Carlsberg is navigating the crisis well , ” Jefferies analysts said , according to Reuters .
“ Beyond 2020 and the easy comparison in 2021 , which should be a summer of sport , Carlsberg remains an attractive investment proposition .
”

Carlsberg expects better than forecast profit as China trade bounces back
Danish brewer Carlsberg said today that it expects to suffer a smaller drop in profit than previously forecast after trade in China bounced back after the coronavirus lockdown.
The firm said it expects a nine per cent drop in operating profit in the second quarter compared to analyst forecasts of a 26 per cent decline.
Carlsberg, which is the world’s third largest brewer after Anheuser Busch InBev and Heineken, said second quarter sales fell 15 per cent with volumes down eight per cent.
However profit in China, the firm’s biggest market, “rebounded strongly” in the second quarter.
Carlsberg said that trading in Western Europe was difficult at the beginning of the quarter but reported “improved performance” towards the end as bars and restaurants reopened amid warm weather in June.
“Although government lockdowns are gradually being lifted, the sales development across our regions in the coming months continues to be volatile and uncertain, not least during the important summer months,” Carlsberg said.
The brewery giant kept its full-year guidance suspended.
“Carlsberg is navigating the crisis well,” Jefferies analysts said, according to Reuters.
“Beyond 2020 and the easy comparison in 2021, which should be a summer of sport, Carlsberg remains an attractive investment proposition.”


cityam--2020-07-10--Peter Harrison: UK business needs a £30bn equity injection

The winning companies of tomorrow need help to survive today .
This is how we , and the government , could help .
The full economic impact of the Covid-19 crisis is now beginning to be felt as each day brings fresh news of job losses .
It will get worse .
There is a chance to mitigate this – to support tomorrow ’ s winning companies that are struggling today .
Encouraging companies to load up on more debt is not the answer .
The solution lies in equity markets .
We have recommended that the government create a @ @ @ @ @ @ @ to £30 billion , to support the growth ambitions of both public and private companies .
Businesses will then be able to afford to protect jobs and keep up their investment plans .
The chancellor has not taken the opportunity of his fiscal statement to do this .
Given the severity of the situation , we hope he will consider such a scheme in the months ahead .
For our part , we are currently considering the launch of our own investment trust .
This is the time to act .
New measures @ @ @ @ @ @ @ expiration of the furlough scheme should be welcomed .
However , they won ’ t prevent widespread job losses .
More debt not the answer , stock market is key Various loan programmes had already been made available , and companies had been allowed to defer some taxes and other payments .
These moves undoubtedly saved businesses and jobs .
But the scale of the crisis is such that more needs to be done .
Further loans are not the answer .
What companies need is equity , not more debt .
The @ @ @ @ @ @ @ and has certainly demonstrated its worth in the crisis so far .
Our analysis shows nearly £14 billion has been raised by 300 companies on the London Stock Exchange in the first six months of 2020 , more than in any year since companies scrambled to repair their balance sheets during the financial crisis of 2008 and 2009 .
Investors have also been sympathetic to the need to cut dividends to protect capital .
We called for such pragmatism in March .
• Peter Harrison : How the investment industry can help during @ @ @ @ @ @ @ The private equity industry is also working hard and investing to support companies that require assistance during this crisis .
Again , firepower across the industry may be insufficient to continue this support indefinitely or to the extent required .
We think much more equity will be needed for both private and public companies and it could prove increasingly hard to come by .
So far , it ’ s been surprisingly easy for companies to raise money with demand buoyed by a resurgence in stock markets .
But if markets become less @ @ @ @ @ @ @ of Covid-19 comes , companies will struggle to raise additional funds in flat or falling markets .
There is a particular need to support companies in the small to mid-cap bracket .
These firms are too large to be the focus of the government ’ s initiatives , but are not “ mega caps ” able to wield their clout with banks or credit markets .
These small and mid-sized companies , with market caps in the £50 million-£2 billion range , comprise 69 of the 300 public equity placings seen so far @ @ @ @ @ @ @ raised around £3.8 billion .
Our fear is that this could prove a drop in the ocean compared to what is needed .
For our part , our UK smaller companies investment team increasingly feels that it has insufficient funds to support all the rights issues that are required to protect quality UK companies .
Across the industry , £150 million has seeped out of small cap UK equity funds so far this year .
Put simply , there isn ’ t enough money to go around for this part of the market @ @ @ @ @ @ @ detail , the money raised by companies isn ’ t from fresh investment , it has been recycled from other UK equities or from existing fund cash balances .
This obviously can ’ t continue .
Bold action is needed now to bring new money into the market .
That is why we have suggested the creation of a government patient capital fund .
It would support businesses but also make the British public stakeholders in companies with the potential to thrive .
Other countries have been very successful in building sovereign wealth @ @ @ @ @ @ @ a framework to help small companies scale up .
The fiscal statement aside , now is the time for legislators and regulators to deal with other long-standing issues .
We would like to see more flexible regulation for workplace defined contribution saving that facilitates a long-term investing horizon and encourages this pool of savers to participate in the compounding of their savings from sustainable and patient equity investing .
This would support the pool of capital available to invest in growth in the UK .
In addition , investments designed for the very @ @ @ @ @ @ @ Fund platforms must be instructed to allow non-daily dealing funds .
Only then can an important pool of patient capital emerge from retirement savings .
Prevarication on this issue has gone on too long .
Asset managers like ourselves have an important part to play too .
We are currently assessing the launch of an investment trust which would provide fresh equity to both public and private markets .
It would seek to identify the highest quality sustainable businesses that have strong growth opportunities ahead , if they can just survive the present @ @ @ @ @ @ @ to our clients in terms of investment returns .
Our industry also has a responsibility to the country to help protect jobs and ensure that the companies that will drive future economic growth remain solvent .
Everybody has a part to play in this crisis .
For our industry , it ’ s ensuring capital markets work when British companies – and their employees – need them most .
Our investment trust would be only the start of what is needed .
We ask the government , and our investment industry peers , @ @ @ @ @ @ @ recapitalisation of companies .
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Peter Harrison: UK business needs a £30bn equity injection
Getty Images
The winning companies of tomorrow need help to survive today. This is how we, and the government, could help.
The full economic impact of the Covid-19 crisis is now beginning to be felt as each day brings fresh news of job losses. It will get worse.
£30 billion fund needed
There is a chance to mitigate this – to support tomorrow’s winning companies that are struggling today. Encouraging companies to load up on more debt is not the answer. The solution lies in equity markets.
We have recommended that the government create a patient capital fund, worth £20 billion to £30 billion, to support the growth ambitions of both public and private companies. Businesses will then be able to afford to protect jobs and keep up their investment plans.
The chancellor has not taken the opportunity of his fiscal statement to do this. Given the severity of the situation, we hope he will consider such a scheme in the months ahead. For our part, we are currently considering the launch of our own investment trust.
This is the time to act. New measures unveiled on Wednesday designed to mitigate the expiration of the furlough scheme should be welcomed. However, they won’t prevent widespread job losses.
More debt not the answer, stock market is key
Various loan programmes had already been made available, and companies had been allowed to defer some taxes and other payments. These moves undoubtedly saved businesses and jobs. But the scale of the crisis is such that more needs to be done. Further loans are not the answer. What companies need is equity, not more debt.
The stock market may hold the solution, and has certainly demonstrated its worth in the crisis so far. Our analysis shows nearly £14 billion has been raised by 300 companies on the London Stock Exchange in the first six months of 2020, more than in any year since companies scrambled to repair their balance sheets during the financial crisis of 2008 and 2009.
Investors have also been sympathetic to the need to cut dividends to protect capital. We called for such pragmatism in March.
The private equity industry is also working hard and investing to support companies that require assistance during this crisis. Again, firepower across the industry may be insufficient to continue this support indefinitely or to the extent required.
We think much more equity will be needed for both private and public companies and it could prove increasingly hard to come by.
So far, it’s been surprisingly easy for companies to raise money with demand buoyed by a resurgence in stock markets. But if markets become less resilient, or if a second wave of Covid-19 comes, companies will struggle to raise additional funds in flat or falling markets.
There is a particular need to support companies in the small to mid-cap bracket. These firms are too large to be the focus of the government’s initiatives, but are not “mega caps” able to wield their clout with banks or credit markets.
These small and mid-sized companies, with market caps in the £50 million-£2 billion range, comprise 69 of the 300 public equity placings seen so far. Through these, they’ve raised around £3.8 billion. Our fear is that this could prove a drop in the ocean compared to what is needed.
Bold action required
For our part, our UK smaller companies investment team increasingly feels that it has insufficient funds to support all the rights issues that are required to protect quality UK companies. Across the industry, £150 million has seeped out of small cap UK equity funds so far this year. Put simply, there isn’t enough money to go around for this part of the market. And if you look at the detail, the money raised by companies isn’t from fresh investment, it has been recycled from other UK equities or from existing fund cash balances. This obviously can’t continue.
Bold action is needed now to bring new money into the market. That is why we have suggested the creation of a government patient capital fund. It would support businesses but also make the British public stakeholders in companies with the potential to thrive. Other countries have been very successful in building sovereign wealth funds; the UK has long needed a framework to help small companies scale up.
The fiscal statement aside, now is the time for legislators and regulators to deal with other long-standing issues. We would like to see more flexible regulation for workplace defined contribution saving that facilitates a long-term investing horizon and encourages this pool of savers to participate in the compounding of their savings from sustainable and patient equity investing. This would support the pool of capital available to invest in growth in the UK.
In addition, investments designed for the very long term require appropriate fund structures. Fund platforms must be instructed to allow non-daily dealing funds. Only then can an important pool of patient capital emerge from retirement savings. Prevarication on this issue has gone on too long.
Asset managers to play an important role
Asset managers like ourselves have an important part to play too. We are currently assessing the launch of an investment trust which would provide fresh equity to both public and private markets. It would seek to identify the highest quality sustainable businesses that have strong growth opportunities ahead, if they can just survive the present.
Clearly, we have a responsibility to our clients in terms of investment returns. Our industry also has a responsibility to the country to help protect jobs and ensure that the companies that will drive future economic growth remain solvent.
Everybody has a part to play in this crisis. For our industry, it’s ensuring capital markets work when British companies – and their employees – need them most. Our investment trust would be only the start of what is needed. We ask the government, and our investment industry peers, to play their role in the great recapitalisation of companies.
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cityam--2020-07-10--Moody’s: UK to suffer worst crash of any big economy

The UK will suffer the worst economic crash of any major economy this year , credit ratings agency Moody ’ @ @ @ @ @ GDP shrinking 10.1 per cent .
Moody ’ s also said government debt as a @ @ @ @ @ balloon by 24 percentage points , two days after chancellor Rishi Sunak vowed to pump @ @ @ @ @ the coronavirus-hit economy .
The UK economy will rebound with growth of 7.1 per cent @ @ @ @ @ credit ratings agency said .
Moody ’ s said it predicts a “ gradual recovery @ @ @ @ @ It said the government ’ s huge fiscal stimulus package will help the economy bounce @ @ @ @ @ UK ’ s public finances hard .

Moody’s: UK to suffer worst crash of any big economy
Major UK retailers such as John Lewis have announced thousands of jobs cuts in the wake of the coronavirus pandemic
The UK will suffer the worst economic crash of any major economy this year, credit ratings agency Moody’s has predicted, with Brexit acting as a drag after the coronavirus crisis.
Moody’s also said government debt as a share of national income will balloon by 24 percentage points compared to its 2019 level, two days after chancellor Rishi Sunak vowed to pump up to £30bn more into the coronavirus-hit economy.
In a note sent out yesterday, Moody’s analysts said they still thought the UK will suffer the biggest drop in GDP in the G20 this year, with the economy shrinking by 10.1 per cent.
Data from June, when Moody’s first made the prediction, predicted France’s GDP will also fall by 10.1 per cent but have a slightly better recovery. Italian GDP is expected to fall 9.7 per cent and the US’s by 5.7 per cent.
“Our forecast estimates a sharper peak-to-trough contraction for the UK than for any other G20 economy,” the analysts said. They said this takes account “of our view that lingering uncertainty around Brexit will hold back the recovery in the second half of the year”.
The UK economy will see a “gradual subsequent recovery on the back of the easing in lockdown measures,” Moody’s said. It predicted growth of 7.1 per cent in 2021.
“High-frequency indicators suggest that economic activity has gradually begun to recover after reaching a trough in April.”
Moody’s said the government’s huge fiscal stimulus package will help the economy bounce back but will hit the UK’s public finances hard.
“According to our baseline scenario, the public debt ratio will likely rise by 24 percentage points of GDP or more relative to 2019 levels,” it said.
The UK’s debt pile has already risen above 100 per cent of GDP. The government has so far spent around £190bn on tackling coronavirus with more likely in the autumn.


cityam--2020-07-10--Thames Clippers expands east with new pier at Barking Riverside

River bus service Thames Clippers is expanding its service east with a new pier at Barking Riverside , City A.M. can reveal .
The pier , which will be delivered in 2021 , is the service ’ s 24th and marks a four km expansion to the east .
Read more : Uber launches world ’ s first Uber Boat with Thames Clippers Co-founder of Thames Clippers Sean Collins told City A.M. that he had approached Barking council on news of the Barking Riverside development , which will build 10,800 homes on the site of the former power station .
@ @ @ @ @ @ @ transport , it connects what would normally be a fairly isolated area.
” He added that he had received support from the council which “ is extremely excited ” about the move east , as well as London mayor Sadiq Khan .
The Greater London Authority ( GLA ) is a partner in the Riverside project and are “ supportive in enhancing the development ” Collins said .
Before the Open newsletter : Start your day with the City View podcast and key market data There has been a gradual move east with @ @ @ @ @ @ @ of City Hall to the Royal Docks .
Indeed Collins recognises new developments in east London has helped his own business .
“ The success of Clippers has been purely based on the development of Canary Wharf and the Docklands , and why the river has become a viable form of transport , ” he said .
“ As [ development ] grows further east that will only get stronger.
” The service is majority owned by AEG , the sports and entertainment group which also owns the O2 in Greenwich .
Before @ @ @ @ @ @ @ track to carry its 50 millionth passenger by the middle of next year .
Lockdown measures saw Thames Clippers temporarily suspend services for nine weeks after operating for London ’ s key workers .
Since resuming services on 15 June , Clippers has attracted new customers , according to Collins , “ as a result of the added social distancing and fresh air ” .
Read more : Ferry service Thames Clippers to restart on 15 June “ It has always been considered a special way to travel , it ’ s a @ @ @ @ @ @ @ space .
Customers have always felt exclusive and honoured to live near the river or interchange.
” There has certainly been growing demand for river services , accelerated by the Covid-19 crisis .
Thames Clippers this week signed a deal with Uber to launch the ride-hailing app ’ s first permanent boat service in the capital .
Collins said that while coronavirus had had a significant impact on transport there is “ a positive future in this partnership.
” Get the news as it happens by following City A.M. on Twitter .

Thames Clippers expands east with new pier at Barking Riverside
River bus service Thames Clippers is expanding its service east with a new pier at Barking Riverside, City A.M. can reveal.
The pier, which will be delivered in 2021, is the service’s 24th and marks a four km expansion to the east.
Co-founder of Thames Clippers Sean Collins told City A.M. that he had approached Barking council on news of the Barking Riverside development, which will build 10,800 homes on the site of the former power station.
“It is ideally located for river transport, it connects what would normally be a fairly isolated area.” He added that he had received support from the council which “is extremely excited” about the move east, as well as London mayor Sadiq Khan.
The Greater London Authority (GLA) is a partner in the Riverside project and are “supportive in enhancing the development” Collins said.
Before the Open newsletter: Start your day with the City View podcast and key market data
There has been a gradual move east with the mayor himself recently mooting a relocation of City Hall to the Royal Docks.
Indeed Collins recognises new developments in east London has helped his own business. “The success of Clippers has been purely based on the development of Canary Wharf and the Docklands, and why the river has become a viable form of transport,” he said.
“As [development] grows further east that will only get stronger.”
The service is majority owned by AEG, the sports and entertainment group which also owns the O2 in Greenwich.
Before the pandemic, the service was on track to carry its 50 millionth passenger by the middle of next year. Lockdown measures saw Thames Clippers temporarily suspend services for nine weeks after operating for London’s key workers.
Since resuming services on 15 June, Clippers has attracted new customers, according to Collins, “as a result of the added social distancing and fresh air”.
“It has always been considered a special way to travel, it’s a relaxing form of transport with plenty of space. Customers have always felt exclusive and honoured to live near the river or interchange.”
There has certainly been growing demand for river services, accelerated by the Covid-19 crisis. Thames Clippers this week signed a deal with Uber to launch the ride-hailing app’s first permanent boat service in the capital.
Collins said that while coronavirus had had a significant impact on transport there is “a positive future in this partnership.”
Get the news as it happens by following City A.M. on Twitter.


cityam--2020-07-10--Sony injects $250m into Fortnite creator Epic Games

Sony has invested $ 250m in the game studio behind Fortnite , giving the tech giant a reported 1.4 per cent stake in the business .
Epic Games is now said to be valued at $ 17.9bn after the deal .
The two companies said the deal will allow them to “ broaden their collaboration across Sony ’ s leading portfolio of entertainment assets and technology , and Epic ’ s social entertainment platform and digital ecosystem to create unique experiences for consumers and creators ” .
Alongside the hit online multiplayer game Fortnite and the Gears of War franchise @ @ @ @ @ @ @ gaming industry for its Unreal games engine software .
Read more : Epic Games to be valued at $ 17bn , as Fortnite event shuts out millions of fans “ Epic ’ s powerful technology in areas such as graphics places them at the forefront of game engine development with Unreal Engine and other innovations , ” said Sony chief executive and chair Kenichiro Yoshida .
“ Through our investment , we will explore opportunities for further collaboration with Epic to delight and bring value to consumers and the industry at large , @ @ @ @ @ @ @ across the rapidly evolving digital entertainment landscape.
” Epic Games is also backed by Chinese tech behemoth Tencent , which invested $ 330m in 2012 in exchange for a 40 per cent stake .
Sony is preparing to launch its Playstation 5 console later this year , with Epic founder and chief executive Tim Sweeney saying the two have been working closely on adapting the new console ’ s storage .
“ Sony and Epic have both built businesses at the intersection of creativity and technology , and we share a vision of @ @ @ @ @ @ @ convergence of gaming , film , and music , ” said Sweeney .
“ Together we strive to build an even more open and accessible digital ecosystem for all consumers and content creators alike .
”

Sony injects $250m into Fortnite creator Epic Games
Sony has invested $250m in the game studio behind Fortnite, giving the tech giant a reported 1.4 per cent stake in the business.
Epic Games is now said to be valued at $17.9bn after the deal.
The two companies said the deal will allow them to “broaden their collaboration across Sony’s leading portfolio of entertainment assets and technology, and Epic’s social entertainment platform and digital ecosystem to create unique experiences for consumers and creators”.
Alongside the hit online multiplayer game Fortnite and the Gears of War franchise, Epic is also known in the gaming industry for its Unreal games engine software.
“Epic’s powerful technology in areas such as graphics places them at the forefront of game engine development with Unreal Engine and other innovations,” said Sony chief executive and chair Kenichiro Yoshida.
“Through our investment, we will explore opportunities for further collaboration with Epic to delight and bring value to consumers and the industry at large, not only in games, but also across the rapidly evolving digital entertainment landscape.”
Epic Games is also backed by Chinese tech behemoth Tencent, which invested $330m in 2012 in exchange for a 40 per cent stake.
Sony is preparing to launch its Playstation 5 console later this year, with Epic founder and chief executive Tim Sweeney saying the two have been working closely on adapting the new console’s storage.
“Sony and Epic have both built businesses at the intersection of creativity and technology, and we share a vision of real-time 3D social experiences leading to a convergence of gaming, film, and music,” said Sweeney.
“Together we strive to build an even more open and accessible digital ecosystem for all consumers and content creators alike.”


cityam--2020-07-10--Pub-goers opt for pints on first weekend back but sales still fall short

Consumers returning to pubs and bars last weekend seemed to be thirsting for their first pint of beer as lockdown restrictions eased in England , but sales still fell short .
Beer sales held up best over the weekend of 4 and 5 July , according to data firm CGA ’ s new Drinks Recovery Tracker .
However they were still down 36 per cent on Saturday and 43 per cent on Sunday compared to pre-pandemic levels .
Read more : Booze misses out on VAT cut , but pubs say glass is half-full Overall drink sales were half that @ @ @ @ @ @ @ cent on Friday and 52 per cnet on Sunday , according to CGA ’ s research .
“ Beer ’ s relatively better showing highlights the struggle of recreating the draught pint experience at home , which has clearly left consumers thirsting for that first pint , ” said CGA ’ s Director of Client Services Jonny Jones .
Earlier today brewer Carlsberg said it expected to suffer a smaller drop in profit than it had previously forecast .
This is largely due to a rebound in trade in China but said trading @ @ @ @ @ @ @ .
Carlsberg said there had been “ improved performance ” towards the end of the second quarter as lockdown restrictions reopened .
Spirits performed roughly in line with the market on Saturday , with sales in pubs dropping 50 per cent compared to pre-Covid levels , but had a better day on Sunday , down 45 per cent .
“ However , Sunday is not as strong a sales day for spirits in a normal week , ” said Jones .
“ So this stronger performance on Sunday is in comparison to a @ @ @ @ @ @ @ praises pubs for closing after punters tested positive for Covid-19 Sales of alcohol outperformed soft drinks over the weekend , with sales down 58 per cent on Saturday and 55 per cent on Sunday .
“ This may well be explained by people staying local and not driving , or families not going out to pubs on the first weekend back , ” Jones added .
Get the news as it happens by following City A.M. on Twitter .

Pub-goers opt for pints on first weekend back but sales still fall short
Consumers returning to pubs and bars last weekend seemed to be thirsting for their first pint of beer as lockdown restrictions eased in England, but sales still fell short.
Beer sales held up best over the weekend of 4 and 5 July, according to data firm CGA’s new Drinks Recovery Tracker. However they were still down 36 per cent on Saturday and 43 per cent on Sunday compared to pre-pandemic levels.
Overall drink sales were half that of pre-lockdown levels, down 49 per cent on Friday and 52 per cnet on Sunday, according to CGA’s research.
“Beer’s relatively better showing highlights the struggle of recreating the draught pint experience at home, which has clearly left consumers thirsting for that first pint,” said CGA’s Director of Client Services Jonny Jones.
Earlier today brewer Carlsberg said it expected to suffer a smaller drop in profit than it had previously forecast. This is largely due to a rebound in trade in China but said trading in Western Europe continued to be difficult.
Carlsberg said there had been “improved performance” towards the end of the second quarter as lockdown restrictions reopened.
Spirits performed roughly in line with the market on Saturday, with sales in pubs dropping 50 per cent compared to pre-Covid levels, but had a better day on Sunday, down 45 per cent.
“However, Sunday is not as strong a sales day for spirits in a normal week,” said Jones. “So this stronger performance on Sunday is in comparison to a lower base.”
Sales of alcohol outperformed soft drinks over the weekend, with sales down 58 per cent on Saturday and 55 per cent on Sunday.
“This may well be explained by people staying local and not driving, or families not going out to pubs on the first weekend back,” Jones added.
Get the news as it happens by following City A.M. on Twitter.


cityam--2020-07-10--Standard Life Aberdeen offloads Boohoo stock over Leicester factory scandal

Investment giant Standard Life Aberdeen has dumped its entire stake in fast fashion firm Boohoo after the retailer was caught up in a scandal over low pay and poor conditions for factory workers .
Boohoo launched an independent review of its UK supply chain following allegations of poor working practices and underpayment of workers at a clothing factory in Leicester .
Read more : Boohoo launches independent review of supply chain after Leicester factory claims The company it had found evidence of non-compliance with its code of conduct , and has terminated its relationship with two suppliers .
However , @ @ @ @ @ @ @ Times , Standard Life Aberdeen said the action taken by Boohoo was “ inadequate ” .
“ Over the years we have lobbied the company to improve its management of supply chain transparency , environmental efficiency and working conditions , ” Lesley Duncan , deputy head of UK Equities at Aberdeen Standard Investments , said .
“ While we would have liked progress to have been quicker we did feel that progress was being made .
“ However , in the last few weeks our concerns have grown on the progress being made @ @ @ @ @ @ @ had negatively impacted our conviction levels in the company .
“ Having spoken to Boohoo ’ s management team a number of times this week in light of recent concerning allegations , we view their response as inadequate in scope , timeliness and gravity.
” Boohoo said it had been engaging with shareholders on the matter .
Jupiter Asset Management , which has a stake in the retailer through its UK small and mid cap equity desk , said it will continue to own shares in the firm .
“ We are aware @ @ @ @ @ @ @ s clothing suppliers in Leicester , ” a spokesperson said .
Read more : Boohoo to cut suppliers in breach of conduct rules “ We have been actively engaging with the company on this topic and have previously undertaken site visits to several of boohoo ’ s UK suppliers to further understand the firm ’ s approach to the complex issue of supply-chain management .
“ We have been given strong assurances by management that any suppliers found to be in breach of the company ’ s strict code of conduct will be @ @ @ @ @ @ @ engage with the firm regarding this situation.
” Boohoo ’ s share price , which was badly affected by the allegations , had started to recover by the end of the week .
However it is still down more than 27 per cent compared to last Friday .
Shares have dipped two per cent this afternoon .
David Beadle , vice president at Moody ’ s , said earlier this week : “ The dramatic fall in Boohoo ’ s share price in recent days is an illustration of how important ESG considerations @ @ @ @ @ @ @ Boohoo shares continue to fall after Leicester factory worker exploitation claims “ Reputational damage leading to lower sales is credit negative for any company and the outcome of Boohoo ’ s independent review into its supply chain will be keenly watched.
” Boohoo said it was “ disappointed ” with Standard Life Aberdeen ’ s decision .
“ We have been engaging extensively with our shareholders and continue to take on board their feedback , ” a spokesperson said .
“ We believe that our actions taken this week , including our recently @ @ @ @ @ @ @ clear just how determined we are to ensure that our entire supply chain adheres to our Code of Conduct .
”

Standard Life Aberdeen offloads Boohoo stock over Leicester factory scandal
Boohoo has bought failing brands before, turning them into online-only brands.
Investment giant Standard Life Aberdeen has dumped its entire stake in fast fashion firm Boohoo after the retailer was caught up in a scandal over low pay and poor conditions for factory workers.
Boohoo launched an independent review of its UK supply chain following allegations of poor working practices and underpayment of workers at a clothing factory in Leicester.
The company it had found evidence of non-compliance with its code of conduct, and has terminated its relationship with two suppliers.
However, in news first reported by the Financial Times, Standard Life Aberdeen said the action taken by Boohoo was “inadequate”.
“Over the years we have lobbied the company to improve its management of supply chain transparency, environmental efficiency and working conditions,” Lesley Duncan, deputy head of UK Equities at Aberdeen Standard Investments, said.
“While we would have liked progress to have been quicker we did feel that progress was being made.
“However, in the last few weeks our concerns have grown on the progress being made, which even before recent developments, had negatively impacted our conviction levels in the company.
“Having spoken to Boohoo’s management team a number of times this week in light of recent concerning allegations, we view their response as inadequate in scope, timeliness and gravity.”
Boohoo said it had been engaging with shareholders on the matter. Jupiter Asset Management, which has a stake in the retailer through its UK small and mid cap equity desk, said it will continue to own shares in the firm.
“We are aware of the accusations made regarding Boohoo’s clothing suppliers in Leicester,” a spokesperson said.
“We have been actively engaging with the company on this topic and have previously undertaken site visits to several of boohoo’s UK suppliers to further understand the firm’s approach to the complex issue of supply-chain management.
“We have been given strong assurances by management that any suppliers found to be in breach of the company’s strict code of conduct will be terminated immediately and we will continue to engage with the firm regarding this situation.”
Boohoo’s share price, which was badly affected by the allegations, had started to recover by the end of the week. However it is still down more than 27 per cent compared to last Friday.
Shares have dipped two per cent this afternoon.
David Beadle, vice president at Moody’s, said earlier this week: “The dramatic fall in Boohoo’s share price in recent days is an illustration of how important ESG considerations are for investors.
“Reputational damage leading to lower sales is credit negative for any company and the outcome of Boohoo’s independent review into its supply chain will be keenly watched.”
Boohoo said it was “disappointed” with Standard Life Aberdeen’s decision.
“We have been engaging extensively with our shareholders and continue to take on board their feedback,” a spokesperson said.
“We believe that our actions taken this week, including our recently announced independent review, make it very clear just how determined we are to ensure that our entire supply chain adheres to our Code of Conduct.”