cityam--2020-06-24--SMEs anticipate spike in redundancies this summer as lockdown eases

Small businesses across the UK are expecting a difficult summer as they predict redundancies are likely to spike in August even as lockdown starts to ease .
The total impact on revenue that SMEs expect from the coronavirus outbreak has reduced from minus 29 per cent at the start of lockdown to minus 10 per cent in May .
Read more : Businesses urge Treasury to incentivise private investors to protect SMEs from collapse However , a poll of over 5,000 SMEs commissioned by technology firm Sage shows that 60 per cent of firms are considering redundancies .
The government @ @ @ @ @ @ @ heralded as crucial to supporting small firms through the pandemic but employers will soon be asked to contribute towards costs , which will likely lead to job cuts .
Although lockdown restrictions are starting to ease , the Sage report underlines the scale of the challenge that lies ahead .
The poll shows that 61 per cent of firms are operating at a loss , and 68 per cent are experiencing a more than 25 per cent reduction in sales .
The divide between sectors has widened somewhat , and for the hospitality @ @ @ @ @ @ @ change in outlook since the start of lockdown .
Even by late May , the hospitality sector maintained expectations of a minus 75 per cent hit to revenue .
Unsurprisingly the extent of the issues means support and approval of government action has grown from 47 per cent at the start of lockdown to highs of 63 per cent in early May .
This corresponded with the introduction of bounce back loans , which offer 100 per cent government-backed loans of up to £50,000 to small businesses .
Before the Open newsletter : @ @ @ @ @ @ @ podcast and key market data While SMEs grapple with the “ new normal ” and a hit to revenues , they will also need to look carefully at their digital safety .
As physical workplaces shut , 28 per cent of firms have pivoted to online but it has meant that nearly a third of SMEs have been victims of hacks , cyber scams or malware since the start of the outbreak .
Despite this , digital security is the lowest priority for investment , and only six per cent of those polled @ @ @ @ @ @ @ Ben Aung , global chief information security officer at Sage said the pandemic is “ fertile hunting ground for cyber-criminals ” as firms pivot to remote working .
He said SMEs should ensure encryption is active and employees receive training to ensure firms are protected against potential attacks .
“ We may be in this situation , or a version of it , for some time to come .
Businesses must understand how attackers are exploiting that fact , and ensure their employees have the knowledge , capabilities and support to play their @ @ @ @ @ @ @ , ” he added .
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SMEs anticipate spike in redundancies this summer as lockdown eases
Regulators in the UK are in the process of interpreting the latest stage of Basel regulations, the global regulatory overhaul prompted by the financial crisis.
Small businesses across the UK are expecting a difficult summer as they predict redundancies are likely to spike in August even as lockdown starts to ease.
The total impact on revenue that SMEs expect from the coronavirus outbreak has reduced from minus 29 per cent at the start of lockdown to minus 10 per cent in May.
However, a poll of over 5,000 SMEs commissioned by technology firm Sage shows that 60 per cent of firms are considering redundancies. The government’s job retention scheme has been heralded as crucial to supporting small firms through the pandemic but employers will soon be asked to contribute towards costs, which will likely lead to job cuts.
Although lockdown restrictions are starting to ease, the Sage report underlines the scale of the challenge that lies ahead. The poll shows that 61 per cent of firms are operating at a loss, and 68 per cent are experiencing a more than 25 per cent reduction in sales.
The divide between sectors has widened somewhat, and for the hospitality and retail industries there has been little change in outlook since the start of lockdown. Even by late May, the hospitality sector maintained expectations of a minus 75 per cent hit to revenue.
Unsurprisingly the extent of the issues means support and approval of government action has grown from 47 per cent at the start of lockdown to highs of 63 per cent in early May. This corresponded with the introduction of bounce back loans, which offer 100 per cent government-backed loans of up to £50,000 to small businesses.
Before the Open newsletter: Start your day with the City View podcast and key market data
Lockdown is ‘hunting ground’ for cyber criminals
While SMEs grapple with the “new normal” and a hit to revenues, they will also need to look carefully at their digital safety.
As physical workplaces shut, 28 per cent of firms have pivoted to online but it has meant that nearly a third of SMEs have been victims of hacks, cyber scams or malware since the start of the outbreak.
Despite this, digital security is the lowest priority for investment, and only six per cent of those polled see it as a significant priority.
Ben Aung, global chief information security officer at Sage said the pandemic is “fertile hunting ground for cyber-criminals” as firms pivot to remote working.
He said SMEs should ensure encryption is active and employees receive training to ensure firms are protected against potential attacks.
“We may be in this situation, or a version of it, for some time to come. Businesses must understand how attackers are exploiting that fact, and ensure their employees have the knowledge, capabilities and support to play their part in reducing business and cyber risks,” he added.
Before the Open: Get the jump on the markets with our early morning newsletter


cityam--2020-06-24--Crisis is 'defining moment' in climate change battle, government told

The government must use its recovery from the coronavirus crisis to accelerate the country ’ s transition to a net zero economy , the Committee on Climate Change ( CCC ) has said .
In its latest guidance to parliament released today , the CCC urged ministers to seize the opportunity to turn the crisis into a “ defining moment ” in the fight against climate change .
Read more : What can the Covid-19 crisis teach us about tackling climate change ?
The report lays out a series of urgent steps which it says the government must take in @ @ @ @ @ @ @ a green recovery .
Lord Deben , the independent body ’ s chairman , said : We have a once-in-a-lifetime opportunity to address these urgent challenges together ; it ’ s there for the taking .
“ The steps that the UK takes to rebuild from the Covid-19 pandemic can accelerate the transition to a successful and low-carbon economy and improve our climate resilience ” .
Five key investment priorities are identified by the report , including the need to retrofit old homes and build new ones to the highest environmental standards .
@ @ @ @ @ @ @ its energy networks and develop infrastructure which encourages people to use active methods of travel like walking or cycling .
In order to do so , the CCC said the government should take the chance to invest in reskilling a workforce for a net zero economy .
Before the Open newsletter : Start your day with the City View podcast and key market data It should also continue to push the “ climate positive ” behaviours that have been on display during the lockdown , like encouraging further remote working .
Baroness Brown @ @ @ @ @ @ @ CCC ’ s adaptation committee , said : Now is the moment to get our house in order , coordinate national planning , and prepare for the inevitable changes ahead .
“ The UK ’ s domestic ambition can be the basis for strong international climate leadership , but the delivery of effective new policies must accelerate dramatically if we ’ re to seize this chance.
” Industry body Energy UK welcomed the findings , saying that the UK had an “ unprecedented opportunity ” to tackle the two challenegs at once .
@ @ @ @ @ @ @ an entire economy will require full commitment and action from right across every Government department and the Devolved Governments ” , said chief executive Audrey Gallacher .
“ The energy sector already invests £14 billion a year and is ready to work closely with Government to help power our economic recovery and meet our net zero target.
” Read more : BoE governor Andrew Bailey : Fiscal stimulus should keep climate change in mind Activists Friends of the Earth also praised the report , but warned that the government could not be considered @ @ @ @ @ @ @ implemented .
“ We should be inspired by what a green and fair COVID recovery can do for everyone .
The Chancellor ’ s speech in early July is the next opportunity for the government to show that they get it ” , said spokesperson Muna Suleiman .

Crisis is ‘defining moment’ in climate change battle, government told
The government must use its recovery from the coronavirus crisis to accelerate the country’s transition to a net zero economy, the Committee on Climate Change (CCC) has said.
In its latest guidance to parliament released today, the CCC urged ministers to seize the opportunity to turn the crisis into a “defining moment” in the fight against climate change.
The report lays out a series of urgent steps which it says the government must take in the coming month in order to initiate a green recovery.
Lord Deben, the independent body’s chairman, said: We have a once-in-a-lifetime opportunity to address these urgent challenges together; it’s there for the taking.
“The steps that the UK takes to rebuild from the Covid-19 pandemic can accelerate the transition to a successful and low-carbon economy and improve our climate resilience”.
Five key investment priorities are identified by the report, including the need to retrofit old homes and build new ones to the highest environmental standards.
It also says the UK should strengthen its energy networks and develop infrastructure which encourages people to use active methods of travel like walking or cycling.
In order to do so, the CCC said the government should take the chance to invest in reskilling a workforce for a net zero economy.
Before the Open newsletter: Start your day with the City View podcast and key market data
It should also continue to push the “climate positive” behaviours that have been on display during the lockdown, like encouraging further remote working.
Baroness Brown of Cambridge, the chair of the CCC’s adaptation committee, said: Now is the moment to get our house in order, coordinate national planning, and prepare for the inevitable changes ahead.
“The UK’s domestic ambition can be the basis for strong international climate leadership, but the delivery of effective new policies must accelerate dramatically if we’re to seize this chance.”
Industry body Energy UK welcomed the findings, saying that the UK had an “unprecedented opportunity” to tackle the two challenegs at once.
“As the CCC notes, transforming an entire economy will require full commitment and action from right across every Government department and the Devolved Governments”, said chief executive Audrey Gallacher.
“The energy sector already invests £14 billion a year and is ready to work closely with Government to help power our economic recovery and meet our net zero target.”
Activists Friends of the Earth also praised the report, but warned that the government could not be considered a climate leader until the recommendations were implemented.
“We should be inspired by what a green and fair COVID recovery can do for everyone. The Chancellor’s speech in early July is the next opportunity for the government to show that they get it”, said spokesperson Muna Suleiman.


cityam--2020-06-24--Builders urge government to target 30,000 new houses for elderly a year in pandemic recovery

The three largest retirement home providers have warned Boris Johnson that Britain ’ s economic recovery from the coronavirus pandemic will be “ running on empty ” if he does not urgently build new houses for older people .
The chief executives of McCarthy & Stone , Churchill Retirement , and Lifestory Group have written to the Prime Minister urging him to build 30,000 new homes a year for older people .
Read more : Housebuilder Taylor Wimpey reports surge in demand after sales centres reopen They said the government should set a target of making 10 per cent of @ @ @ @ @ @ @ bracket .
In the letter , they argue that building houses for the older generation can stimulate action in the housing market , as older people move house to downsize and younger people buy their previous property .
“ Building more specialist retirement housing would be a win-win for the government , ” they said .
“ It would unlock the housing market , helping older people , young families and first-time buyers .
It would also assist with attempts to fix the social care crisis once and for all.
” The bosses @ @ @ @ @ @ @ help ensure that vulnerable people are better protected against future pandemics , highlighting that they have seen extremely low levels of infection from Covid-19 among their residents , who are typically over 80 .
“ With the number of older people in England growing significantly , the time to act is now , ” they said .
Read more : UK house prices to fall five per cent this year “ The government has given the housing market the green light to get moving again and we welcome this .
“ But the @ @ @ @ @ @ @ be running on empty if we don ’ t take urgent action to help the millions of people who actively want to downsize .
”

Builders urge government to target 30,000 new houses for elderly a year in pandemic recovery
The three largest retirement home providers have warned Boris Johnson that Britain’s economic recovery from the coronavirus pandemic will be “running on empty” if he does not urgently build new houses for older people.
The chief executives of McCarthy & Stone, Churchill Retirement, and Lifestory Group have written to the Prime Minister urging him to build 30,000 new homes a year for older people.
They said the government should set a target of making 10 per cent of new housing specific for the older age bracket.
In the letter, they argue that building houses for the older generation can stimulate action in the housing market, as older people move house to downsize and younger people buy their previous property.
“Building more specialist retirement housing would be a win-win for the government,” they said.
“It would unlock the housing market, helping older people, young families and first-time buyers. It would also assist with attempts to fix the social care crisis once and for all.”
The bosses also said that building specialist housing would help ensure that vulnerable people are better protected against future pandemics, highlighting that they have seen extremely low levels of infection from Covid-19 among their residents, who are typically over 80.
“With the number of older people in England growing significantly, the time to act is now,” they said.
“The government has given the housing market the green light to get moving again and we welcome this.
“But the risk is that the recovery drive will be running on empty if we don’t take urgent action to help the millions of people who actively want to downsize.”


cityam--2020-06-24--Half of all equity investment goes to UK tech businesses

Nearly half of the total equity investment in UK SMEs last year went to tech firms , as the sector continues to remain attractive to investors .
Equity investment in the UK ’ s tech firms increased 27 per cent to £4bn in the last year , its highest level since 2011 .
Read more : Britain ’ s tech scene ready to welcome foreign talent after Trump ’ s visa ban The growing tech sector in the UK remains incredibly attractive to investors , accounting for 47 per cent of the total investment through 691 deals , according to @ @ @ @ @ @ @ Small Business Equity Tracker report .
Investment in software led the charge , with 425 deals worth £2bn , followed by life sciences with 78 deals worth £450m .
Software as a Service ( Saas ) in particular remained attractive to investors with 471 deals completed worth £2.5bn .
Its value rose 69 per cent in 2019 compared to the previous year .
The report shows that the value of total equity investment in SMEs rose 24 per cent to £8.5bn last year , the highest on record .
Deal numbers rose four @ @ @ @ @ @ @ sizes jumped 21 per cent .
Chief executive of the British Business Bank Keith Morgan said : “ This was a clear sign of investor confidence in UK smaller businesses located across the country and their potential for growth as well as the strong fundamentals of the UK economy as a place to start and grow a business.
” Although it has been a strong year for fundraising , there was a softening in the small business equity markets before the coronavirus lockdown restrictions .
Investment into seed stage firms declined by one @ @ @ @ @ @ @ year since 11 , when the tracker was launched .
The British Business Bank has warned that this has the potential to impact the future UK equity pipeline .
Investors ’ caution is not limited to early stage firms , with an increase in equity “ down rounds ” in 2019 , forming 12 per cent all deals in 2019 compared to nine per cent in 2018 .
Read more : Britain ’ s tech sector takes in $ 5.3bn in first half of 2020 Alice Hu Wager , managing director of strategy @ @ @ @ @ @ @ shows a “ strong interest in growth stage investment ” .
“ Ensuring our high potential later stage companies have the capital they need to compete on the global stage will be crucial to powering the economic recovery.
” Get the news as it happens by following City A.M. on Twitter .

Half of all equity investment goes to UK tech businesses
Nearly half of the total equity investment in UK SMEs last year went to tech firms, as the sector continues to remain attractive to investors.
Equity investment in the UK’s tech firms increased 27 per cent to £4bn in the last year, its highest level since 2011.
The growing tech sector in the UK remains incredibly attractive to investors, accounting for 47 per cent of the total investment through 691 deals, according to the British Business Bank’s annual Small Business Equity Tracker report.
Investment in software led the charge, with 425 deals worth £2bn, followed by life sciences with 78 deals worth £450m. Software as a Service (Saas) in particular remained attractive to investors with 471 deals completed worth £2.5bn. Its value rose 69 per cent in 2019 compared to the previous year.
The report shows that the value of total equity investment in SMEs rose 24 per cent to £8.5bn last year, the highest on record. Deal numbers rose four per cent to 1,832, while deal sizes jumped 21 per cent.
Chief executive of the British Business Bank Keith Morgan said: “This was a clear sign of investor confidence in UK smaller businesses located across the country and their potential for growth as well as the strong fundamentals of the UK economy as a place to start and grow a business.”
Although it has been a strong year for fundraising, there was a softening in the small business equity markets before the coronavirus lockdown restrictions.
Investment into seed stage firms declined by one per cent last year after rising every year since 11, when the tracker was launched. The British Business Bank has warned that this has the potential to impact the future UK equity pipeline.
Investors’ caution is not limited to early stage firms, with an increase in equity “down rounds” in 2019, forming 12 per cent all deals in 2019 compared to nine per cent in 2018.
Alice Hu Wager, managing director of strategy economics and business development said the report shows a “strong interest in growth stage investment”.
“Ensuring our high potential later stage companies have the capital they need to compete on the global stage will be crucial to powering the economic recovery.”
Get the news as it happens by following City A.M. on Twitter.


cityam--2020-06-24--Small tech firms rake in record £4bn investment in 2019 – and deals continue despite coronavirus

Equity investment in the UK ’ s smaller tech businesses soared to £4bn last year , the highest figure on record – and despite a coronavirus-induced slowdown , deals are still being done .
The highest investment total ever meant that Britain ’ s tech companies enjoyed 27 per cent more funding than the previous year , according to the British Business Bank ’ s annual Small Business Equity Tracker report .
Read more : Britain ’ s tech scene ready to welcome foreign talent after Trump ’ s visa ban It came as part of a wider total equity @ @ @ @ @ @ @ s smaller businesses , a 24 per cent year-on-year rise .
The data also reflected a record number of deals , rising four per cent to 1,832 with deal sizes up by 21 per cent .
The coronavirus lockdown has slowed the market down considerably in recent months ; the bank ’ s analysis of Beauhurst data showed that 43 per cent of all UK equity backed companies are at least moderately affected by changes in delivery and demand for their products and services .
Nevertheless , Matt Adey , director of economics @ @ @ @ @ @ @ A.M. that there had been “ a fair bit of activity in April and there were still deals being done even in May , ” despite the lockdown .
“ That ’ s not to say that there wont be an impact , but for many equity finance is a bit of a longer term game.
” He said it would be impossible to predict when the market would return to 2019 levels , but said “ the market hasn ’ t stopped , it ’ s still going .
There are still @ @ @ @ @ @ @ sign.
” Read more : Brits rejoice !
The era of black market hairdressers is coming to an end On the wider market , Alice Hu Wagner , managing director of strategy economics and business development , added that the figures for 2019 showed “ a strong interest in growth stage investment in the equity market , with a particular focus on tech businesses ” .
“ Ensuring our high-potential later stage companies have the capital they need to compete on the global stage will be crucial to powering the economic recovery .
@

Small tech firms rake in record £4bn investment in 2019 – and deals continue despite coronavirus
Equity investment in the UK’s smaller tech businesses soared to £4bn last year, the highest figure on record – and despite a coronavirus-induced slowdown, deals are still being done.
The highest investment total ever meant that Britain’s tech companies enjoyed 27 per cent more funding than the previous year, according to the British Business Bank’s annual Small Business Equity Tracker report.
It came as part of a wider total equity investment of £8.5bn in the UK’s smaller businesses, a 24 per cent year-on-year rise.
The data also reflected a record number of deals, rising four per cent to 1,832 with deal sizes up by 21 per cent.
The coronavirus lockdown has slowed the market down considerably in recent months; the bank’s analysis of Beauhurst data showed that 43 per cent of all UK equity backed companies are at least moderately affected by changes in delivery and demand for their products and services.
Nevertheless, Matt Adey, director of economics at the British Business Bank told City A.M. that there had been “a fair bit of activity in April and there were still deals being done even in May,” despite the lockdown.
“That’s not to say that there wont be an impact, but for many equity finance is a bit of a longer term game.”
He said it would be impossible to predict when the market would return to 2019 levels, but said “the market hasn’t stopped, it’s still going. There are still many opportunities. It is a positive sign.”
On the wider market, Alice Hu Wagner, managing director of strategy economics and business development, added that the figures for 2019 showed “a strong interest in growth stage investment in the equity market, with a particular focus on tech businesses”.
“Ensuring our high-potential later stage companies have the capital they need to compete on the global stage will be crucial to powering the economic recovery.”


cityam--2020-06-24--CBI urges government to extend business loans scheme

The CBI has urged the government to extend the Coronavirus Business Interruption Loan Scheme ( CBILS ) until November , as part of a wave of proposals to keep businesses alive as the UK faces its worst recession on record .
The business body , which represents around 190,000 UK companies , today called on the government to extend the deadline for chancellor Rishi Sunak ’ s business loan scheme beyond August for a further three months .
“ We are deeply concerned about rising unemployment and the survival of many firms in hard hit sectors over the summer and @ @ @ @ @ @ @ director-general Dame Carolyn Fairbairn .
“ The survival of many businesses in hard hit sectors still hangs in the balance over the summer as schemes begin to wind down .
These firms can not wait until the autumn for further action , ” she added .
CBILS , which sees the government underwrite 80 per cent of the value of a loan , has been hugely valuable to businesses already facing cashflow challenges , providing more than £10.5bn to 50,482 businesses in the UK so far .
But lending data released yesterday showed @ @ @ @ @ @ @ of applications through CBILS , even as overall lending rose above £20bn .
The CBI warned that the UK faces a second wave of businesses who may need support “ particularly in sectors such as engineering services and manufacturers of capital equipment where order books for late 2020 are looking weak ” , and called on the government to extend the window for new applications to CBILS .
The proposal is part of a raft of measures put forward by the CBI to ensure the government protects British jobs and livelihoods as the @ @ @ @ @ @ @ Other measures set out by the CBI included extending grant support schemes for small and medium sized businesses ( SMEs ) and extending business rates relief in England to mid-sized businesses in all sectors for the next three months to help supply chains recover .
The business body also called on the government to immediately defer VAT payments for businesses in the second quarter of 2020 , and to make targeted VAT cuts in enabling sectors .
Sunak is said to be considering slashing VAT for a temporary period to boost the economy @ @ @ @ @ @ @ Alistair Darling , Sajid Javid and Ken Clarke to do so .
“ This package of business support should be backed by a major jobs scheme focused on helping young people into employment , delivered at speed and scale , ” the CBI said .
It suggested that the Coronavirus Jobs Retention Scheme —known as the furlough scheme — should be extended beyond its October deadline “ to stave off unnecessary job losses ” , and that the government ups funding in schools and universities to avoid generational inequality .
The business collective @ @ @ @ @ @ @ the US , who have all launched further packages of financial support to bolster their economies .
“ They are seeking to stay ahead of the curve of deep and lasting recession ; we must do the same , ” said Fairbairn .
The CBI also pointed to rocky territory for the British property market , which all but ground to a halt during the pandemic , causing a knock-on effect in other key sectors such as construction and business services .
It called on the government to temporarily reduce Stamp Duty Land @ @ @ @ @ @ @ market by increasing the tax-free allowance for six months .
The CBI also urged Downing Street to use to £3.8bn allocated for a Social Housing Decarbonisation Fund in the Tory manifesto to allow housing associations to use funding to improve energy efficiency .
The government should “ introduce a national energy efficiency programme to retrofit homes , backed by grants or loans to encourage energy efficiency improvements in private homes ” , the CBI added .
It comes as the UK faces its “ deepest recession in living memory , ” after months @ @ @ @ @ @ @ ground the economy to a halt .
Earlier this month , the OECD found that Britain ’ s economy is likely to suffer the worst damage from the coronavirus crisis of any country in the developed world .
A predicted slump in the UK ’ s national income of 21.5 per cent for 2020 will surpass tumbles seen in France , Italy , Spain , Germany and the US , the OECD said .
Last month , the chancellor conceded that the UK is set to face a “ significant recession ” , @ @ @ @ @ @ @ per cent in the first three months of the year .
Economists have now abandoned hoped for a V-shaped recovery from the crisis in the UK .
The IMF yesterday said the UK ’ s budget deficit for 2020 is likely to be 12.7 per cent of GDP , or £270bn , as the UK ’ s furlough scheme and other emergency packages take a toll on public finances .
“ While more firms are starting to reopen , demand is weak and hugely uncertain .
Many firms are struggling to see how @ @ @ @ @ @ @ in place ” , said Fairbairn .
“ If you take these actions now , building on the success of your economic strategy so far , the UK can stay ahead of the next wave of this crisis and ensure our economy remains globally competitive.
” “ By working together , business and government can help foster a strong recovery , reducing inequalities and supporting a dynamic economy and sustainable future.
” Before the Open : Get the jump on the markets with our early morning newsletter

CBI urges government to extend business loans scheme
The CBI has urged the government to extend the Coronavirus Business Interruption Loan Scheme (CBILS) until November, as part of a wave of proposals to keep businesses alive as the UK faces its worst recession on record.
The business body, which represents around 190,000 UK companies, today called on the government to extend the deadline for chancellor Rishi Sunak’s business loan scheme beyond August for a further three months.
“We are deeply concerned about rising unemployment and the survival of many firms in hard hit sectors over the summer and into the autumn”, said CBI director-general Dame Carolyn Fairbairn.
“The survival of many businesses in hard hit sectors still hangs in the balance over the summer as schemes begin to wind down. These firms cannot wait until the autumn for further action,” she added.
CBILS
CBILS, which sees the government underwrite 80 per cent of the value of a loan, has been hugely valuable to businesses already facing cashflow challenges, providing more than £10.5bn to 50,482 businesses in the UK so far.
But lending data released yesterday showed lenders have only approved 51 per cent of applications through CBILS, even as overall lending rose above £20bn.
The CBI warned that the UK faces a second wave of businesses who may need support “particularly in sectors such as engineering services and manufacturers of capital equipment where order books for late 2020 are looking weak”, and called on the government to extend the window for new applications to CBILS.
Support schemes and VAT cuts
The proposal is part of a raft of measures put forward by the CBI to ensure the government protects British jobs and livelihoods as the UK emerges from months of lockdown.
Other measures set out by the CBI included extending grant support schemes for small and medium sized businesses (SMEs) and extending business rates relief in England to mid-sized businesses in all sectors for the next three months to help supply chains recover.
The business body also called on the government to immediately defer VAT payments for businesses in the second quarter of 2020, and to make targeted VAT cuts in enabling sectors.
Sunak is said to be considering slashing VAT for a temporary period to boost the economy, following pressure from former chancellors Lord Alistair Darling, Sajid Javid and Ken Clarke to do so.
Young at heart
“This package of business support should be backed by a major jobs scheme focused on helping young people into employment, delivered at speed and scale,” the CBI said.
It suggested that the Coronavirus Jobs Retention Scheme —known as the furlough scheme — should be extended beyond its October deadline “to stave off unnecessary job losses”, and that the government ups funding in schools and universities to avoid generational inequality.
The business collective drew comparisons with Germany, France and the US, who have all launched further packages of financial support to bolster their economies.
“They are seeking to stay ahead of the curve of deep and lasting recession; we must do the same,” said Fairbairn.
Property
The CBI also pointed to rocky territory for the British property market, which all but ground to a halt during the pandemic, causing a knock-on effect in other key sectors such as construction and business services.
It called on the government to temporarily reduce Stamp Duty Land Tax for the lowest end of the market by increasing the tax-free allowance for six months.
The CBI also urged Downing Street to use to £3.8bn allocated for a Social Housing Decarbonisation Fund in the Tory manifesto to allow housing associations to use funding to improve energy efficiency.
The government should “introduce a national energy efficiency programme to retrofit homes, backed by grants or loans to encourage energy efficiency improvements in private homes”, the CBI added.
Recession
It comes as the UK faces its “deepest recession in living memory,” after months of lockdown forced business to shutter and ground the economy to a halt.
Earlier this month, the OECD found that Britain’s economy is likely to suffer the worst damage from the coronavirus crisis of any country in the developed world. A predicted slump in the UK’s national income of 21.5 per cent for 2020 will surpass tumbles seen in France, Italy, Spain, Germany and the US, the OECD said.
Last month, the chancellor conceded that the UK is set to face a “significant recession”, as figures showed the economy shrank two per cent in the first three months of the year. Economists have now abandoned hoped for a V-shaped recovery from the crisis in the UK.
The IMF yesterday said the UK’s budget deficit for 2020 is likely to be 12.7 per cent of GDP, or £270bn, as the UK’s furlough scheme and other emergency packages take a toll on public finances.
“While more firms are starting to reopen, demand is weak and hugely uncertain. Many firms are struggling to see how they can be profitable with social distancing in place”, said Fairbairn.
“If you take these actions now, building on the success of your economic strategy so far, the UK can stay ahead of the next wave of this crisis and ensure our economy remains globally competitive.”
“By working together, business and government can help foster a strong recovery, reducing inequalities and supporting a dynamic economy and sustainable future.”
Before the Open: Get the jump on the markets with our early morning newsletter


cityam--2020-06-24--City of London Corporation donates £200,000 to cancer charity

The City of London Corporation has donated £200,000 through its City Bridge Trust to a Hammersmith-based charity that helps people cope with the financial impact of cancer .
Maggie ’ s , which has 23 centres across the UK , will use the funds to employ a specialist welfare rights and benefits adviser , to help those diagnosed with cancer seek financial support .
Last year , the charity helped people with cancer claim nearly £38m in benefits and grants .
Read more : London coronavirus cases : How many infections are in your London borough ?
Dhruv Patel , @ @ @ @ @ @ @ , said : “ A cancer diagnosis is a bombshell in anyone ’ s life and not only impacts people emotionally and physically , but financially , as they may lose income through having to give up work and face increased costs such as travel to hospital appointments.
” He added : “ Maggie ’ s has continued to support people with cancer throughout the coronavirus crisis.
” Read more : Khan calls for London furlough extension as he warns of ‘ looming unemployment crisis ’ The City Corporation ’ s charitable trust @ @ @ @ @ @ @ giver , making awards of around £20m each year for charitable causes across the capital .
The fund has contributed more than £6m to the London Community Response , an emergency support fund that has helped charities in the capital detail with the impact of coronavirus .
It has also donated £1.7m in one-off grants to more than 200 organisations to help them offset lost income from the pandemic .
Before the Open : Get the jump on the markets with our early morning newsletter

City of London Corporation donates £200,000 to cancer charity
The City of London Corporation, based in the Square Mile in London, strongly condemned the alleged culture of abuse at the CBI
The City of London Corporation has donated £200,000 through its City Bridge Trust to a Hammersmith-based charity that helps people cope with the financial impact of cancer.
Maggie’s, which has 23 centres across the UK, will use the funds to employ a specialist welfare rights and benefits adviser, to help those diagnosed with cancer seek financial support. Last year, the charity helped people with cancer claim nearly £38m in benefits and grants.
Dhruv Patel, chairman of the City Bridge Trust Committee, said: “A cancer diagnosis is a bombshell in anyone’s life and not only impacts people emotionally and physically, but financially, as they may lose income through having to give up work and face increased costs such as travel to hospital appointments.”
He added: “Maggie’s has continued to support people with cancer throughout the coronavirus crisis.”
The City Corporation’s charitable trust is London’s biggest independent grant giver, making awards of around £20m each year for charitable causes across the capital.
The fund has contributed more than £6m to the London Community Response, an emergency support fund that has helped charities in the capital detail with the impact of coronavirus. It has also donated £1.7m in one-off grants to more than 200 organisations to help them offset lost income from the pandemic.
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cityam--2020-06-24--Westferry documents suggest Jenrick intentionally saved developer £50m

Documents released today by Robert Jenrick suggest the housing secretary intentionally carried forward a planning decision over the Westferry housing scheme in order to save its developer from having to pay £50m to the local council .
The housing secretary bowed to pressure from Labour earlier today and released 129 pages of documents relating to his decision to grant approval to the 1,500 home development at the former Westferry printing works site on the Isle of Dogs .
Jenrick faced accusations of “ cash for favours ” after it emerged the site ’ s developer , former Daily Express owner @ @ @ @ @ @ @ to the Conservative party 12 days after the housing secretary approved the deal .
Documents unveiled today showed that Jenrick intended to approve the scheme on 14 January , in order to save Desmond from paying tens of millions to Tower Hamlets council .
“ On timing , my understanding is that [ the secretary of state ] is/was insistent that [ a ] decision is issued this week i.e .
tomorrow — as next week the viability of the scheme is impacted by a change in the London CIL [ Community Infrastructure @ @ @ @ @ @ @ read .
Labour said the timing of the decision to approve the scheme — just a day before a new community infrastructure levy came into force — would have saved Desmond ’ s Northern and Shell company up to £50m .
The documents also revealed that Jenrick and Desmond were in close communication in the months preceding the deal .
In November , Jenrick texted Desmond to say : “ Good to spend time with you tonight Richard .
See you again soon I hope , ” to which Desmond replied : “ @ @ @ @ @ @ @ .
Will call your office tomorrow to arrange.
” Subsequent texts show the pair arranged to meet in December , when Desmond texted the housing secretary to say : “ Good news finally the inspectors ’ reports have gone to you today , we appreciate the speed as we don ’ t want to give Marxists loads of doe for nothing !
” Jenrick replied : “ Richard .
As Secretary of State it is important not to give any appearance of being influenced by applicants of cases that I may have a @ @ @ @ @ @ @ and so I think it is best that we don ’ t meet until after the matter has been decided , one way or another.
” On 23 December , Desmond texted the housing secretary to say : “ Morning Robert .
How does the advice look ?
We have to get the approval before 15 January otherwise [ a ] payment of £45m to Tower Hamlets meaning we have to stop and reduce social housing .
Thanks Robert looking forward to speaking soon.
” Jenrick then approved the planning decision on 14 @ @ @ @ @ @ @ legislation came into effect .
Jenrick then texted Demsond a week later to say : “ Richard I hope you understood that I could not speak with you or have contact whilst I was making my decision with respect to the planning application at Westferry — which is why I did not return your messages .
Best wishes , Robert.
” The housing secretary is now facing mounting pressure to resign .
Clive Betts , the chair of the housing , communities and local government committee , questioned why Jenrick had waited until @ @ @ @ @ @ @ in the development to make the announcement .
“ I think it might have been helpful if we had had it before the debate today , ” he said .
Jenrick did not respond to requests for comment .

Westferry documents suggest Jenrick intentionally saved developer £50m
Documents released today by Robert Jenrick suggest the housing secretary intentionally carried forward a planning decision over the Westferry housing scheme in order to save its developer from having to pay £50m to the local council.
The housing secretary bowed to pressure from Labour earlier today and released 129 pages of documents relating to his decision to grant approval to the 1,500 home development at the former Westferry printing works site on the Isle of Dogs.
Jenrick faced accusations of “cash for favours” after it emerged the site’s developer, former Daily Express owner and pornographer Richard Demsond, donated £12,000 to the Conservative party 12 days after the housing secretary approved the deal.
Documents unveiled today showed that Jenrick intended to approve the scheme on 14 January, in order to save Desmond from paying tens of millions to Tower Hamlets council.
“On timing, my understanding is that [the secretary of state] is/was insistent that [a] decision is issued this week i.e. tomorrow — as next week the viability of the scheme is impacted by a change in the London CIL [Community Infrastructure Levy] regime,” one document read.
Labour said the timing of the decision to approve the scheme — just a day before a new community infrastructure levy came into force — would have saved Desmond’s Northern and Shell company up to £50m.
The documents also revealed that Jenrick and Desmond were in close communication in the months preceding the deal.
In November, Jenrick texted Desmond to say: “Good to spend time with you tonight Richard. See you again soon I hope,” to which Desmond replied: “Thanks Robert I really appreciate your text. Will call your office tomorrow to arrange.”
Subsequent texts show the pair arranged to meet in December, when Desmond texted the housing secretary to say: “Good news finally the inspectors’ reports have gone to you today, we appreciate the speed as we don’t want to give Marxists loads of doe [sic] for nothing!
According to a 2019 report from Jenrick’s own department, Tower Hamlets is one of the local authorities with the highest proportion of children and older people in income deprivation.
Jenrick replied: “Richard. As Secretary of State it is important not to give any appearance of being influenced by applicants of cases that I may have a role in or to have predetermined them and so I think it is best that we don’t meet until after the matter has been decided, one way or another.”
On 23 December, Desmond texted the housing secretary to say: “Morning Robert. How does the advice look? We have to get the approval before 15 January otherwise [a] payment of £45m to Tower Hamlets meaning we have to stop and reduce social housing. Thanks Robert looking forward to speaking soon.”
Jenrick then approved the planning decision on 14 January, the day before the new legislation came into effect.
Jenrick then texted Demsond a week later to say: “Richard I hope you understood that I could not speak with you or have contact whilst I was making my decision with respect to the planning application at Westferry — which is why I did not return your messages. Best wishes, Robert.”
The housing secretary is now facing mounting pressure to resign.
Clive Betts, the chair of the housing, communities and local government committee, questioned why Jenrick had waited until Labour tabled a debate on his role in the development to make the announcement. “I think it might have been helpful if we had had it before the debate today,” he said.
Jenrick did not respond to requests for comment.


cityam--2020-06-24--Government mulls financial support for UK's ailing theatres

The UK government is in talks to support the performing arts industry , Downing Street confirmed today , amid growing concerns the sector is nearing collapse as a result of the coronavirus crisis .
Number 10 today said it was working with senior figures from the theatre industry on a rescue package , as the Prime Minister ’ s announcement yesterday that theatres will not be allowed to host live performances when they reopen cast doubt on the future of the sector .
Read more : Workers on furlough pass 9m as cost of job support measures nears £30bn “ @ @ @ @ @ @ @ and considering ways in which we might be able to support them in addition to the unprecedented financial assistance we ’ ve already given , ” the Prime Minister ’ s official spokesperson said .
“ We have given unprecedented levels of financial assistance already via government loans , the job retention scheme , and support has been given by the Arts Council as well , ” Downing Street added .
The government has reportedly tabled a loan scheme worth £1bn for the sector , the Financial Times reported , but Whitehall sources @ @ @ @ @ @ @ be significantly smaller .
But according to a report published by The Off West End Theatre Awards , a cash injection of £9m would be enough to rescue 100 independent London fringe theatres from going insolvent this year .
Industry figures have warned that redundancies will remain on the horizon unless the government provides further economic support , after theatres were forced to shutter in March .
Data published by the CEBR think tank last year showed that the UK ’ s arts and cultural industry contributes £11bn a year to the British @ @ @ @ @ @ @ such as the National Theatre turned online to stream past performances during lockdown , but theatres have warned that substitutes for live performances are unviable .
The Royal Shakespeare Company is currently raking in around a quarter of its usual income , while others are taking in even less .
Several theatres , including Leicester ’ s Haymarket and the Southport Theatre , have already gone into liquidation .
Research by the Society of London Theatre and UK Theatre suggested that 70 per cent of theatres will run out of money by the @ @ @ @ @ @ @ .
West End producer Cameron Mackintosh last week announced that some of his hit musicals including Hamilton , Les Miserables and Phantom of the Opera , will not reopen until next year .
He added that a lack of “ tangible practical support ” from the government risked further redundancies and placed the sector ’ s future in question .
Read more : Cineworld to reopen UK cinemas with social distancing measures on 10 July “ This has forced me to take drastic steps to ensure that I have the resources for my @ @ @ @ @ @ @ and theatres to reopen next year when we are permitted to , ” he said .
“ Without our theatres being ablaze with life , London can not properly reopen as one of the world ’ s greatest cities.
” Before the Open : Get the jump on the markets with our early morning newsletter

Government mulls financial support for UK’s ailing theatres
The UK government is in talks to support the performing arts industry, Downing Street confirmed today, amid growing concerns the sector is nearing collapse as a result of the coronavirus crisis.
Number 10 today said it was working with senior figures from the theatre industry on a rescue package, as the Prime Minister’s announcement yesterday that theatres will not be allowed to host live performances when they reopen cast doubt on the future of the sector.
“We are talking to the arts sector and considering ways in which we might be able to support them in addition to the unprecedented financial assistance we’ve already given,” the Prime Minister’s official spokesperson said.
“We have given unprecedented levels of financial assistance already via government loans, the job retention scheme, and support has been given by the Arts Council as well,” Downing Street added.
The government has reportedly tabled a loan scheme worth £1bn for the sector, the Financial Times reported, but Whitehall sources have suggested that any financial package will be significantly smaller.
But according to a report published by The Off West End Theatre Awards, a cash injection of £9m would be enough to rescue 100 independent London fringe theatres from going insolvent this year.
Industry figures have warned that redundancies will remain on the horizon unless the government provides further economic support, after theatres were forced to shutter in March.
Data published by the CEBR think tank last year showed that the UK’s arts and cultural industry contributes £11bn a year to the British economy and supports 363,700 jobs.
Venues such as the National Theatre turned online to stream past performances during lockdown, but theatres have warned that substitutes for live performances are unviable.
The Royal Shakespeare Company is currently raking in around a quarter of its usual income, while others are taking in even less. Several theatres, including Leicester’s Haymarket and the Southport Theatre, have already gone into liquidation.
Research by the Society of London Theatre and UK Theatre suggested that 70 per cent of theatres will run out of money by the end of 2020 without further financial aid.
West End producer Cameron Mackintosh last week announced that some of his hit musicals including Hamilton, Les Miserables and Phantom of the Opera, will not reopen until next year.
He added that a lack of “tangible practical support” from the government risked further redundancies and placed the sector’s future in question.
“This has forced me to take drastic steps to ensure that I have the resources for my business to survive and enable my shows and theatres to reopen next year when we are permitted to,” he said.
“Without our theatres being ablaze with life, London cannot properly reopen as one of the world’s greatest cities.”
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cityam--2020-06-24--‘Subscription box economy’ helps to fuel parcel delivery surge

“ Just a second , I need to get to the front door – a delivery ’ s just arrived ” : it ’ s become as familiar a scenario during a Zoom call as someone forgetting that they ’ re on mute .
The sound of doorbells ringing as packages are deposited on doorsteps , with delivery drivers dutifully stepping two metres back , has become a streetscape constant during lockdown .
Hand-scrawled posters thank our postal workers and all those pounding the pavements with packages , along with the country ’ s NHS heroes .
The growth of @ @ @ @ @ @ @ by research by YouGov for Royal Mail .
Nearly half ( 45 % ) of UK adults say they have been receiving more parcel deliveries since 23 March .
DPD , whose increasingly familiar white , red and black liveried vans shuttle goods around the country for many leading retailers , said last week that it would be investing £200m to expand its network to meet an ‘ unprecedented ’ surge in popularity for its next-day parcel services .
Monthly moments of delight on the doorstep The lockdown-triggered e-commerce explosion is driving this @ @ @ @ @ @ @ propeller is what has been dubbed the ‘ subscription box economy ’ .
A subscription box is where people pay a fixed monthly fee for a box to arrive at a set interval ( for example , every month ) full of new delights to try out .
Popular boxes include recipe/food kits , beauty products and alcohol .
Subscription services are growing at a ‘ phenomenal ’ rate , with growth of the UK market set to reach an estimated £1bn in value by 2022 , according to an exhaustive 74-page analysis @ @ @ @ @ @ @ year .
Grenadia is a company operating a review and comparison website – allsubscriptionboxes.co.uk – for boxes across all sorts of interest areas .
Its founder , Michaël Maarek , says the subscription economy has “ benefited hugely ” from lockdown .
“ During May our website for UK subscription boxes received 173 % more visitors compared to the same period in May last year , ” he tells City AM .
“ Categories that have enjoyed the highest increase in demand are kids ’ boxes – parents are looking for innovative ways @ @ @ @ @ @ @ – and food boxes , especially recipe boxes and meal-kits.
” Recipe boxes are Londoners ’ most popular type of subscription box , according to Royal Mail ’ s research .
Gousto , which is one of the best-known such brands along with the likes of Hello Fresh and Mindful Chef , announced in April that it had secured £33m of new funding from investors , saying it would be accelerating innovation including next-day delivery .
The funding was secured before coronavirus but nonetheless lockdown has clearly got more people clicking ( and @ @ @ @ @ @ @ director of parcel sales , Jon Nicholson , tells City AM that he has definitely seen a rise in subscription-based retail models since the pandemic forced high-street retailers to temporarily close .
“ According to our research , 15 % of UK adults have ordered a paid subscription box online since lockdown began as more and more shoppers look to cheer themselves up through regular online purchases for items including health and beauty necessities , clothing and foodstuffs .
These types of products lend themselves to a subscription approach , and once people @ @ @ @ @ @ @ way , the added convenience it brings is compelling.
” It ’ s a very similar story at DPD , whose chief executive Dwain McDonald observes : “ The subscription box market has certainly been a significant development for us in recent years .
It really suits our model as it is generally based on small- to medium-sized , regular shaped boxes being delivered next-day , seven days a week .
People want to find original gifts that feel personalised for the individual .
Lockdown has accelerated this trend with peaks such as @ @ @ @ @ @ @ volumes almost double last year .
They are easy to find online where people are browsing and looking for gift ideas.
” The rise of subscription boxes has largely been driven by start-ups but bigger brands are increasingly muscling in .
All retailers love the revenue predictability while successful start-ups can even see their products end up in high-street stores , as has been the case with healthy snacks company Graze ( which was acquired by Unilever last year ) .
It ’ s also an international opportunity with nearly 90 per cent @ @ @ @ @ @ @ of their sales overseas .
Challenges include retaining customers after the novelty of having experimental eye-liner and unorthodox craft ale regularly turning up wears off .
People typically tend to be hitting ‘ unsubscribe ’ and dialling direct-debit cancellation hotlines after just five or six months , according to different datasets .
While lockdown has brought opportunities , it has also bought obstacles : for suppliers , supply-chain disruption ; many consumers , meanwhile , will wonder whether many subscriptions are an unnecessary indulgence in these economically difficult times .
“ I think @ @ @ @ @ @ @ necessity to delight customers continuously every month with a new concept , ” says Maarek , who says successful subscription-box brands tend to create a ( virtual ) community for subscribers and “ build a brand proposition that goes beyond the contents of each box ” .

What is City Talk? City Talk allows marketers to connect directly with our audience by publishing content on cityam.com
‘Subscription box economy’ helps to fuel parcel delivery surge
Getty images
“Just a second, I need to get to the front door – a delivery’s just arrived”: it’s become as familiar a scenario during a Zoom call as someone forgetting that they’re on mute.
The sound of doorbells ringing as packages are deposited on doorsteps, with delivery drivers dutifully stepping two metres back, has become a streetscape constant during lockdown. Hand-scrawled posters thank our postal workers and all those pounding the pavements with packages, along with the country’s NHS heroes.
The growth of parcel ordering during lockdown has been highlighted by research by YouGov for Royal Mail. Nearly half (45%) of UK adults say they have been receiving more parcel deliveries since 23 March.
DPD, whose increasingly familiar white, red and black liveried vans shuttle goods around the country for many leading retailers, said last week that it would be investing £200m to expand its network to meet an ‘unprecedented’ surge in popularity for its next-day parcel services.
Monthly moments of delight on the doorstep
The lockdown-triggered e-commerce explosion is driving this. One less obvious but related growth propeller is what has been dubbed the ‘subscription box economy’.
A subscription box is where people pay a fixed monthly fee for a box to arrive at a set interval (for example, every month) full of new delights to try out. Popular boxes include recipe/food kits, beauty products and alcohol.
Subscription services are growing at a ‘phenomenal’ rate, with growth of the UK market set to reach an estimated £1bn in value by 2022, according to an exhaustive 74-page analysis delivered by Royal Mail in February last year.
Grenadia is a company operating a review and comparison website – allsubscriptionboxes.co.uk – for boxes across all sorts of interest areas. Its founder, Michaël Maarek, says the subscription economy has “benefited hugely” from lockdown.
“During May our website for UK subscription boxes received 173% more visitors compared to the same period in May last year,” he tells City AM. “Categories that have enjoyed the highest increase in demand are kids’ boxes – parents are looking for innovative ways to entertain children while schools are shut – and food boxes, especially recipe boxes and meal-kits.”
Recipe boxes are Londoners’ most popular type of subscription box, according to Royal Mail’s research. Gousto, which is one of the best-known such brands along with the likes of Hello Fresh and Mindful Chef, announced in April that it had secured £33m of new funding from investors, saying it would be accelerating innovation including next-day delivery. The funding was secured before coronavirus but nonetheless lockdown has clearly got more people clicking (and cooking).
Royal Mail’s director of parcel sales, Jon Nicholson, tells City AM that he has definitely seen a rise in subscription-based retail models since the pandemic forced high-street retailers to temporarily close. “According to our research, 15% of UK adults have ordered a paid subscription box online since lockdown began as more and more shoppers look to cheer themselves up through regular online purchases for items including health and beauty necessities, clothing and foodstuffs. These types of products lend themselves to a subscription approach, and once people are used to receiving goods in this way, the added convenience it brings is compelling.”
It’s a very similar story at DPD, whose chief executive Dwain McDonald observes: “The subscription box market has certainly been a significant development for us in recent years. It really suits our model as it is generally based on small- to medium-sized, regular shaped boxes being delivered next-day, seven days a week. People want to find original gifts that feel personalised for the individual. Lockdown has accelerated this trend with peaks such as Easter and Father’s Day seeing volumes almost double last year. They are easy to find online where people are browsing and looking for gift ideas.”
Brand building beyond the box
The rise of subscription boxes has largely been driven by start-ups but bigger brands are increasingly muscling in. All retailers love the revenue predictability while successful start-ups can even see their products end up in high-street stores, as has been the case with healthy snacks company Graze (which was acquired by Unilever last year).
It’s also an international opportunity with nearly 90 per cent of subscription businesses making at least some of their sales overseas.
Challenges include retaining customers after the novelty of having experimental eye-liner and unorthodox craft ale regularly turning up wears off. People typically tend to be hitting ‘unsubscribe’ and dialling direct-debit cancellation hotlines after just five or six months, according to different datasets.
While lockdown has brought opportunities, it has also bought obstacles: for suppliers, supply-chain disruption; many consumers, meanwhile, will wonder whether many subscriptions are an unnecessary indulgence in these economically difficult times.
“I think that the biggest ongoing challenge is the necessity to delight customers continuously every month with a new concept,” says Maarek, who says successful subscription-box brands tend to create a (virtual) community for subscribers and “build a brand proposition that goes beyond the contents of each box”.
Out-of-the-box thinkers take note.


cityam--2020-06-25--ActivTrades' revenue set to climb to record high in H1 2020

London-based online brokerage ActivTrades is on track to post its best ever half-year results , thanks to an increase in trading volumes and strong growth in the number of clients .
With only a few days to go to the end of the second quarter , the company has recorded £30 million in revenue for the first half of 2020 , more than trebling the £8 million registered in the same period last year and already well above the £20.6 million it recorded for the whole of 2019 .
This year is poised to be the most profitable ever for @ @ @ @ @ @ @ expected to be a record £18 million .
“ We are very pleased with this performance .
We were expecting a strong year but this goes beyond our estimates and bodes well for future growth , ” said ActivTrades CEO Alex Pusco .
“ The return of volatility globally has helped and we have also seen a strong increase in clients in various regions .
At this turbulent time for markets , ActivTrades has benefitted from its reputation as one of the most efficient and trusted online brokerages ” .
ActivTrades ’ bright @ @ @ @ @ @ @ which has seen trading volumes climb and sparked a surge in volatility on markets , lifting both top and bottom lines for the brokerage .
The company also gained from the expansion of its product range and the addition of new clients , many of whom are adopting the new web-based ActivTrader platform .
“ These impressive numbers also highlight the success of our new platform ActivTrader , which is easy to use , very innovative and offers fast order execution .
Clients are certainly rewarding us for this upgrade , ” said @ @ @ @ @ @ @ new products to its offering this year .
Among them are CFDs on more than 100 new shares around the world and two innovative CFDs tied to the spot price of WTI and Brent .
Unlike traditional CFDs on oil futures , these contracts do not need rolling over to future dates as they do not have an expiry date .
“ We developed these products extremely quickly after the unforeseen dive in prices of near-expiry oil futures this spring , ” explained Alex Pusco “ We wanted to offer our clients an @ @ @ @ @ @ @ exposure to oil prices without having to worry about rolling over their positions.
” With CFDs there are no commissions with the only cost being the bid/ask spread applied by the broker .
A swap rate may apply to keep positions open overnight while there are no additional costs for intraday trading .
ActivTrades is a multiple award-winning brokerage and has been in operation since 2001 .
Besides its headquarter in London , it has offices in Milan , Nassau and Sofia .

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ActivTrades’ revenue set to climb to record high in H1 2020
London-based online brokerage ActivTrades is on track to post its best ever half-year results, thanks to an increase in trading volumes and strong growth in the number of clients.
With only a few days to go to the end of the second quarter, the company has recorded £30 million in revenue for the first half of 2020, more than trebling the £8 million registered in the same period last year and already well above the £20.6 million it recorded for the whole of 2019.
This year is poised to be the most profitable ever for the brokerage, with first half profit expected to be a record £18 million.
“We are very pleased with this performance. We were expecting a strong year but this goes beyond our estimates and bodes well for future growth,” said ActivTrades CEO Alex Pusco. “The return of volatility globally has helped and we have also seen a strong increase in clients in various regions. At this turbulent time for markets, ActivTrades has benefitted from its reputation as one of the most efficient and trusted online brokerages”.
ActivTrades’ bright performance came amidst the Covid-19 crisis, which has seen trading volumes climb and sparked a surge in volatility on markets, lifting both top and bottom lines for the brokerage.
The company also gained from the expansion of its product range and the addition of new clients, many of whom are adopting the new web-based ActivTrader platform.
“These impressive numbers also highlight the success of our new platform ActivTrader, which is easy to use, very innovative and offers fast order execution. Clients are certainly rewarding us for this upgrade,” said Pusco.
ActivTrades has been adding multiple new products to its offering this year. Among them are CFDs on more than 100 new shares around the world and two innovative CFDs tied to the spot price of WTI and Brent. Unlike traditional CFDs on oil futures, these contracts do not need rolling over to future dates as they do not have an expiry date.
“We developed these products extremely quickly after the unforeseen dive in prices of near-expiry oil futures this spring,” explained Alex Pusco “We wanted to offer our clients an alternative solution to be able to gain exposure to oil prices without having to worry about rolling over their positions.”
With CFDs there are no commissions with the only cost being the bid/ask spread applied by the broker. A swap rate may apply to keep positions open overnight while there are no additional costs for intraday trading.
ActivTrades is a multiple award-winning brokerage and has been in operation since 2001. Besides its headquarter in London, it has offices in Milan, Nassau and Sofia.


cityam--2020-06-25--Easyjet confirms more international flights to restart from 1 July

Easyjet has confirmed plans to begin flying from airports across Europe from July , the low-cost carrier said this morning .
After restarting its services with a small number of flights last week , the airline today outlined plans to expand both domestic and international operations .
Read more : Easyjet raises £419m through share placing to bolster finances From 1 July , Easyjet will operate 500 flights a day across Europe , as well as 900 a week to and from the UK .
By August , it is hoping to run 75 per cent of its 1022 routes @ @ @ @ @ @ @ be at about 30 per cent of usual capacity due to coronavirus .
Some of the reintroduced destinations include Paris , Barcelona and Milan , as well as flights to the Balearic and Canary Islands and holiday hotspots across the Mediterranean .
Chief operating officer Robert Carey said : “ We are really pleased to be relaunching even more of our flights from 1 July and starting to get customers away on their much-needed summer holidays ” .
Before the Open newsletter : Start your day with the City View podcast and key @ @ @ @ @ @ @ airline industry awaits the government ’ s announcement as to which countries will be included under “ air bridge ” arrangements .
Ministers are expected to share details of the plan on Monday , but the Telegraph reported that short-haul European destinations such as France , Spain , Italy and Greece will be among the first tranche of countries named .
The government will reportedly take a three-stage approach to getting flying going again , starting with European nations and then expanding to take in international locations .
This morning Easyjet separately announced @ @ @ @ @ @ @ placing to help bolster its finances through the coronavirus recovery period .
In total , the budget airline placed 59.5m ordinary new shares – 15 per cent of the firm ’ s existing share capital – at a price of 703p per share .

Easyjet confirms more international flights to restart from 1 July
Easyjet cancelled 222 flights over the weekend as chaos is expected to continue today
Easyjet has confirmed plans to begin flying from airports across Europe from July, the low-cost carrier said this morning.
After restarting its services with a small number of flights last week, the airline today outlined plans to expand both domestic and international operations.
From 1 July, Easyjet will operate 500 flights a day across Europe, as well as 900 a week to and from the UK.
By August, it is hoping to run 75 per cent of its 1022 routes, though it warned passenger numbers would be at about 30 per cent of usual capacity due to coronavirus.
Some of the reintroduced destinations include Paris, Barcelona and Milan, as well as flights to the Balearic and Canary Islands and holiday hotspots across the Mediterranean.
Chief operating officer Robert Carey said: “We are really pleased to be relaunching even more of our flights from 1 July and starting to get customers away on their much-needed summer holidays”.
Before the Open newsletter: Start your day with the City View podcast and key market data
The announcement comes as the airline industry awaits the government’s announcement as to which countries will be included under “air bridge” arrangements.
Ministers are expected to share details of the plan on Monday, but the Telegraph reported that short-haul European destinations such as France, Spain, Italy and Greece will be among the first tranche of countries named.
The government will reportedly take a three-stage approach to getting flying going again, starting with European nations and then expanding to take in international locations.
This morning Easyjet separately announced it had raised £419m through a share placing to help bolster its finances through the coronavirus recovery period.
In total, the budget airline placed 59.5m ordinary new shares – 15 per cent of the firm’s existing share capital – at a price of 703p per share.


cityam--2020-06-25--BAE Systems warns of drop in first half profit amid coronavirus disruption

BAE Systems first-half profit will be about one-sixth down on last year , after the coronavirus pandemic hit the defence giant .
The company said that it still enjoyed strong demand for its defence products which make up the vast majority of its business .
Read more : BAE Systems sees profits rise as aircraft contracts pay off However , its manufacturing lines have faced disruption amid the lockdown , it said this morning .
Sales have suffered in its higher-margin commercial equipment , such as electronic systems for passenger jets , it said , dragging down profit .
These @ @ @ @ @ @ @ buses , and are primarily based in the US .
BAE said it expected weaker demand across these products for the coming months .
Meanwhile in the UK , it said 90 per cent of its employees were back to work , most from home , while “ critical on site workers ” were back at its shipyards and manufacturing plants .
But supply chain disruption as well as social distancing and other safety measures in factories had affected productivity .
In April , BAE Systems deferred a decision on its final dividend @ @ @ @ @ @ @ said today that it would update markets again next month .
Shares were 0.5 per cent up at midday .

BAE Systems warns of drop in first half profit amid coronavirus disruption
BAE Systems first-half profit will be about one-sixth down on last year, after the coronavirus pandemic hit the defence giant.
The company said that it still enjoyed strong demand for its defence products which make up the vast majority of its business.
However, its manufacturing lines have faced disruption amid the lockdown, it said this morning.
Sales have suffered in its higher-margin commercial equipment, such as electronic systems for passenger jets, it said, dragging down profit.
These commercial units also make systems for domestic buses, and are primarily based in the US. BAE said it expected weaker demand across these products for the coming months.
Meanwhile in the UK, it said 90 per cent of its employees were back to work, most from home, while “critical on site workers” were back at its shipyards and manufacturing plants.
But supply chain disruption as well as social distancing and other safety measures in factories had affected productivity.
In April, BAE Systems deferred a decision on its final dividend payment to shareholders for 2019. It said today that it would update markets again next month.
Shares were 0.5 per cent up at midday.


cityam--2020-06-25--Mitie snaps up Interserve facilities arm to create outsourcing giant

Mitie will buy the facilities management arm of rival outsourcer Interserve for £271m , the company announced today , creating a new business with nearly 80,000 employees .
The move will make the company the UK ’ s largest facilities management group , and see Mitie increase its interests in the country ’ s lucrative outsourcing industry .
Read more : Mitie unlikely to pay dividend as it cuts costs The acquisition , which was confirmed this morning by the firm , was first reported last night by Sky News .
In order to fund the deal in light of @ @ @ @ @ @ @ it had launched a £201m rights issue .
Chief executive Phil Bentley said : “ This will be a transformative acquisition , expanding the scale and footprint of our business to create the UK ’ s largest facilities management company and accelerate the delivery of Mitie ’ s long-term technology-led , vision ” .
The deal comes with the sector under even tighter scrutiny than ever over the government ’ s reliance on such firms to provide essential services .
Before the Open newsletter : Start your day with the City View podcast @ @ @ @ @ @ @ have been closely involved with the development of the NHS ’ emergency Nightingale hospitals , while rival Serco has faced criticism for its role in the government ’ s track and trace system .
The collapse of outsourcing giant Carillion in 2018 has led to intense scrutiny of the decision to let such contracts to firms operating on tiny margins .
Alongside the announcement , Mitie also released its full-year results , which showed that the firm had been more resilient to coronavirus than previously expected .
Despite the lockdown restrictions , revenue @ @ @ @ @ @ @ per cent to £301.4m .
However , the board said the firm would cancel its dividend for the year due to the need to preserve cash in light of the crisis .
Bentley said : “ In adversity , we have seen character , bravery , resilience , determination – and opportunity .
Read more : Outsourcing giants to discuss contracts reform with Whitehall officials “ I have been incredibly proud of how our business has responded to the Covid-19 crisis .
We have 37,500 frontline workers keeping the UK safe and operational @ @ @ @ @ @ @ sites of national security , or keeping offices , transport hubs or manufacturing plants open .
“ Mitie has been proud to support NHS Nightingale hospitals and Covid-19 testing centres around the UK .
Our employees are our frontline heroes and I am humbled by all they do ” .

Mitie snaps up Interserve facilities arm to create outsourcing giant
Mitie Bus Stop and Shelter Cleaning Services in London (Credit: Ed Robinson/OneRedEye)
Mitie will buy the facilities management arm of rival outsourcer Interserve for £271m, the company announced today, creating a new business with nearly 80,000 employees.
The move will make the company the UK’s largest facilities management group, and see Mitie increase its interests in the country’s lucrative outsourcing industry.
The acquisition, which was confirmed this morning by the firm, was first reported last night by Sky News.
In order to fund the deal in light of the coronavirus crisis, Mitie also said it had launched a £201m rights issue.
Chief executive Phil Bentley said: “This will be a transformative acquisition, expanding the scale and footprint of our business to create the UK’s largest facilities management company and accelerate the delivery of Mitie’s long-term technology-led, vision”.
The deal comes with the sector under even tighter scrutiny than ever over the government’s reliance on such firms to provide essential services.
Before the Open newsletter: Start your day with the City View podcast and key market data
Mitie and Interserve have been closely involved with the development of the NHS’ emergency Nightingale hospitals, while rival Serco has faced criticism for its role in the government’s track and trace system.
The collapse of outsourcing giant Carillion in 2018 has led to intense scrutiny of the decision to let such contracts to firms operating on tiny margins.
Alongside the announcement, Mitie also released its full-year results, which showed that the firm had been more resilient to coronavirus than previously expected.
Despite the lockdown restrictions, revenue in April and May fell just 12 per cent to £301.4m.
However, the board said the firm would cancel its dividend for the year due to the need to preserve cash in light of the crisis.
Bentley said: “In adversity, we have seen character, bravery, resilience, determination – and opportunity.
“I have been incredibly proud of how our business has responded to the Covid-19 crisis. We have 37,500 frontline workers keeping the UK safe and operational whether in hospitals, supermarkets or, sites of national security, or keeping offices, transport hubs or manufacturing plants open.
“Mitie has been proud to support NHS Nightingale hospitals and Covid-19 testing centres around the UK. Our employees are our frontline heroes and I am humbled by all they do”.


cityam--2020-06-25--Google to automatically delete search and location data

Google will now automatically delete your search and location history after 18 months , as it attempts to assuage concerns from regulators that it controls too much information about individuals .
Users will be able to toggle in their settings to wipe their data every three or 18 months , with the latter now automatically turned on .
The two options were first introduced last year , but users had to opt in to the service .
The feature will apply to search history either on web or in-app , location history , and voice commands made through Google ’ @ @ @ @ @ @ @ also be automatically wiped , but after 36 months .
Read more : Google faces calls from staff to end tech sales to police In a post announcing the changes , chief executive Sundar Pichai said the firm was dedicated to keeping private information safe and giving users more control over their data .
“ We believe that products should keep your information for only as long as it ’ s useful and helpful to you , ” he wrote .
“ Being a responsible steward of your data means keeping it private @ @ @ @ @ @ @ to make advances in privacy-preserving technologies and invest in thousands of privacy engineers to make our protections stronger across Google products.
” Read more : Privacy U-turn : NHS tracing app shifted to Apple and Google model The move follows an investigation launched by the Irish Data Protection Commission in February to explore allegations of whether Google ’ s data handling was a breach of privacy rules .
Google ’ s data practices are also under investigation in the US , where the state of Arizona filed a lawsuit last month arguing it @ @ @ @ @ @ @ from tracking your movements without your knowledge or consent ” .
The new rules will not apply to Gmail , or its storage platforms Photos and Drive .

Google to automatically delete search and location data
Google will now automatically delete your search and location history after 18 months, as it attempts to assuage concerns from regulators that it controls too much information about individuals.
Users will be able to toggle in their settings to wipe their data every three or 18 months, with the latter now automatically turned on. The two options were first introduced last year, but users had to opt in to the service.
The feature will apply to search history either on web or in-app, location history, and voice commands made through Google’s voice assistant. Youtube history will also be automatically wiped, but after 36 months.
In a post announcing the changes, chief executive Sundar Pichai said the firm was dedicated to keeping private information safe and giving users more control over their data.
“We believe that products should keep your information for only as long as it’s useful and helpful to you,” he wrote.
“Being a responsible steward of your data means keeping it private. That’s why we continue to make advances in privacy-preserving technologies and invest in thousands of privacy engineers to make our protections stronger across Google products.”
The move follows an investigation launched by the Irish Data Protection Commission in February to explore allegations of whether Google’s data handling was a breach of privacy rules.
Google’s data practices are also under investigation in the US, where the state of Arizona filed a lawsuit last month arguing it is “nearly impossible to stop Google from tracking your movements without your knowledge or consent”.
The new rules will not apply to Gmail, or its storage platforms Photos and Drive.


cityam--2020-06-25--DEBATE: Should the mayor of London move City Hall to the Royal Docks?

Should the mayor of London move City Hall to the Royal Docks ?
Joanne McCartney , statutory deputy mayor of London , says YES .
The catastrophic economic consequences of Covid-19 have already hit London ’ s economy hard .
Unemployment is rising .
Millions are furloughed .
Tax revenues have fallen .
London councils face a budget shortfall of £1.3bn this year .
Transport for London ’ s fares income has fallen by more than 90 per cent .
The Greater London Authority Group faces a shortfall of £500m over the next two years — leaving no choice other @ @ @ @ @ @ @ and transport services .
And rather than acting to invest in our economic recovery and local services , the government is allowing a new era of austerity to take hold .
Against this backdrop , the mayor must consider every option to protect frontline services .
That ’ s why he is personally committed to taking a 10 per cent pay cut , and why he is considering leaving the current City Hall building to save money .
Relocating to the Royal Docks would save £55m over five years , which can be @ @ @ @ @ @ @ provision .
The mayor makes no apologies for prioritising economic recovery and public services over bricks and mortar .
John Oxley , a Conservative commentator and former candidate for Newham Council , says NO .
City Halls should be about more than function and efficiency .
They should be knitted into the civic fabric .
Think of the Palazzo Vecchio , a marker on the Florentine skyline , or the Hôtel de Ville which has been an active part of Paris ’ tumultuous history .
These are not simply offices and chambers , @ @ @ @ @ @ @ Greater London Authority ’ s “ Glass Gonad ” may lack the same history or beauty , but its location speaks to an important narrative .
On the banks of the river , across from the history of the Tower and the promise of the City , the thread of London ’ s greatness runs right through it .
It is at the centre of the city , both geographically and psychologically .
Moving the whole show down the length of the DLR would make the city ’ s government less visible , @ @ @ @ @ @ @ .
Symbolism matters , and while Newham is a fantastic borough , the seat of Greater London ’ s government should not be separated from its heart .
Read more : Sadiq Khan ’ s TfL fare freeze not ‘ responsible ’ , says Grant Shapps

DEBATE: Should the mayor of London move City Hall to the Royal Docks?
City Halls should be knitted into the civic fabric
Should the mayor of London move City Hall to the Royal Docks?
Joanne McCartney, statutory deputy mayor of London, says YES.
The catastrophic economic consequences of Covid-19 have already hit London’s economy hard. Unemployment is rising. Millions are furloughed. Tax revenues have fallen.
London councils face a budget shortfall of £1.3bn this year. Transport for London’s fares income has fallen by more than 90 per cent. The Greater London Authority Group faces a shortfall of £500m over the next two years — leaving no choice other than significant cuts to police, fire and transport services. And rather than acting to invest in our economic recovery and local services, the government is allowing a new era of austerity to take hold.
Against this backdrop, the mayor must consider every option to protect frontline services. That’s why he is personally committed to taking a 10 per cent pay cut, and why he is considering leaving the current City Hall building to save money.
Relocating to the Royal Docks would save £55m over five years, which can be invested in jobs, services and skills provision.
The mayor makes no apologies for prioritising economic recovery and public services over bricks and mortar.
John Oxley, a Conservative commentator and former candidate for Newham Council, says NO.
City Halls should be about more than function and efficiency. They should be knitted into the civic fabric. Think of the Palazzo Vecchio, a marker on the Florentine skyline, or the Hôtel de Ville which has been an active part of Paris’ tumultuous history.
These are not simply offices and chambers, but icons of their city.
The Greater London Authority’s “Glass Gonad” may lack the same history or beauty, but its location speaks to an important narrative. On the banks of the river, across from the history of the Tower and the promise of the City, the thread of London’s greatness runs right through it. It is at the centre of the city, both geographically and psychologically.
Moving the whole show down the length of the DLR would make the city’s government less visible, and by that less relevant and accountable.
Symbolism matters, and while Newham is a fantastic borough, the seat of Greater London’s government should not be separated from its heart.
Main image credit: Getty


cityam--2020-06-25--Twenty-two police officers injured in Brixton street party clash

Twenty-two police officers were injured during clashes at an illegal street party in Brixton last night , as large crowds descended into violence .
Two officers were taken to hospital after trying to disperse the “ unlicensed music event ” near the Angell Town estate in Brixton last night , after residents complained about noise and violence .
Read more : London coronavirus cases : How many infections are in your London borough ?
Footage on social media showed a number of police vehicles being smashed up and officers being chased during clashes with a large crowd .
Home secretary @ @ @ @ @ @ @ utterly vile ” , after the Metropolitan Police confirmed 22 officers were injured .
Four people were arrested for assault and public order offences , and remain in custody .
Police later implemented a section 60 order , which allows officers to search anyone in the area without “ reasonable grounds ” .
Patel added : “ Just last weekend , the whole country came together to praise our heroic police officers for putting their own lives on the line to keep us safe , ” referring to the terror attack in Reading @ @ @ @ @ @ @ be picking up with the Met Commissioner immediately ” .
Read more : Sadiq Khan is wrong — extending the furlough scheme would hinder London ’ s recovery , not help it Mayor of London Sadiq Khan took to Twitter , saying that “ violence against the police will not be tolerated.
” “ I ’ m in touch with the Met about the completely unacceptable events in Brixton overnight .
Violence against the police will not be tolerated .
Large gatherings during Covid-19 are deeply irresponsible and risk others ’ lives , @ @ @ @ @

Twenty-two police officers injured in Brixton street party clash
Twenty-two police officers were injured during clashes at an illegal street party in Brixton last night after large crowds descended into violence.
Two officers were taken to hospital after trying to disperse the “unlicensed music event” near the Angell Town estate in Brixton last night, after residents complained about noise and violence.
Footage on social media showed a number of police vehicles being smashed up and officers being chased during clashes with a large crowd.
Home secretary Priti Patel described the scenes as “utterly vile”, after the Metropolitan Police confirmed 22 officers were injured. Four people were arrested for assault and public order offences, and remain in custody.
Police later implemented a section 60 order, which allows officers to search anyone in the area without “reasonable grounds”.
Patel added: “Just last weekend, the whole country came together to praise our heroic police officers for putting their own lives on the line to keep us safe,” referring to the terror attack in Reading last Saturday. “I’ll be picking up with the Met Commissioner immediately”.
The Prime Minister’s official spokesman said the government will launch a consultation on doubling the maximum sentence for assaulting an emergency worker.
“These were appalling scenes. Violence against the police will not be tolerated,” the spokesman said.
“We have been clear that anyone who assaults the police or any of our emergency service workers who keep us safe should feel the full force of the law.”
Mayor of London Sadiq Khan took to Twitter, saying that “violence against the police will not be tolerated.”
“I’m in touch with the Met about the completely unacceptable events in Brixton overnight. Violence against the police will not be tolerated. Large gatherings during Covid-19 are deeply irresponsible and risk others’ lives,” the mayor added.


cityam--2020-06-25--FTSE 100 falls as spike in coronavirus cases spooks investors

The FTSE 100 opened lower on Thursday as fears of a resurgence of coronavirus in the US continued to spook traders .
London ’ s blue-chip index opened 0.57 per cent lower , before clawing back some losses to trade down 0.12 per cent by 10.50am .
Read more : Stocks sell-off continues as new cases rocket The renewed concern of a second wave , which could derail a swift economic recovery , left the FTSE 100 down more than three per cent by the end of the session on Wednesday .
The growing numbers of coronavirus cases in the @ @ @ @ @ @ @ .
Wall Street closed 2.5 per cent lower while Asian suffered their biggest drop in eight sessions on Thursday .
Cases in the US are rising with Florida , Oklahoma and South Carolina reporting a record number .
While seven other states recorded higher numbers earlier this week , with Texas considering a local lockdown to curb the spread of the virus .
As the situation worsens , news came of President Donald Trump ’ s administration closing federal funding for 13 Covid-19 testing sites , according to CNBC .
This includes one @ @ @ @ @ @ @ reported in just one day and hospitals reach capacity .
Read more : Global stocks sink deep into red as second wave fears bite A warning from the International Monetary Fund ( IMF ) did little to quell investors ’ nerves on the FTSE this morning .
It warned that the decline in growth could be worse than initially feared , and is predicting an almost five per cent decline in growth .
It is significantly worse than the three per cent decline it first predicted .
FTSE traders ’ concerns will likely @ @ @ @ @ @ @ of US jobless claims and GDP data .
Despite the UK starting to reopen again , the FTSE ’ s travel stocks are struggling in Thursday ’ s session .
“ Domestic travel groups such as Trainline , Go-Ahead Group , and National Express are seeing sharp downside as doubt creeps in despite the proposed reopening of the UK , ” said IG analyst Joshua Mahony .
Go-Ahead Group dipped 4.6 per cent while National Express fell 4.81 per cent .
Airlines are also struggling this session , with British Airways owner IAG @ @ @ @ @ @ @ airline Easyjet is down nearly six per cent after raising £419m at only a five per cent discount to last night ’ s closing price .
“ With coronavirus still omnipresent around the world , it is going to be a very hard slog for EasyJet to start repairing its earnings as customer demand and the length of time that travel restrictions between various countries will stay in place remain so uncertain , ” says Russ Mould , AJ Bell ’ s investment director .
Get the news as it happens by following @ @ @ @ @

Global stocks claw back losses despite second wave fears
The FTSE 100 clawed back some of its losses and swung positive on Thursday, despite concerns that a resurgence of coronavirus cases in the US could stall the global economic recovery.
London’s blue-chip index closed 0.38 per cent higher at 6,147 points, after a volatile day of trading which saw it drop 0.57 per cent lower on open.
The FTSE 100 gained ground by the end of the session attempting to claw back Wednesday’s losses which saw it close down three per cent.
The growing numbers of coronavirus cases in the US has sent jitters through stocks globally. Nevertheless, Wall Street was 0.18 per cent up this afternoon while Asian suffered their biggest drop in eight sessions on Thursday.
European peers also managed to close in the green as the Dax shot up 0.5 per cent and France’s Cac gained 0.8 per cent.
A warning from the International Monetary Fund (IMF) did little to quell investors’ nerves on the FTSE this morning. It warned that the decline in growth could be worse than initially feared, and is predicting an almost five per cent decline in growth. It is significantly worse than the three per cent decline it first predicted.
“It seems that investors aren’t yet ready to heed the IMF’s advice about the gulf between the recent market rally – which has taken its knocks of late, but still leaves indices well above their end of March lows – and the realities of a global recession,” said Spreadex analyst Connor Campbell.
FTSE gains a ‘holding action’
The FTSE 100 and its European peers managed to “clock up some passable gains this afternoon” said Chris Beauchamp, chief market analyst at IG.
“Although this is more of a holding action rather than a solid rebound from yesterday’s heavy losses. The key question for investors now is whether the rise in cases is a series of localised outbreaks or the beginning of a real second wave” he added.
If the cases are just localised, markets could start to rise again but if it is indicative of a second wave then stocks could fall further.
“In one way the price action of the past two days looks similar to previous drops since March – a quick and dramatic fall that is then steadily clawed back,” Beauchamp said.
Wall Street stumbles as cases rise and jobless claims remain high
US stocks gained after dipping on open but investors remain jittery on the prospect of a second wave.
Cases in the US are rising with Florida, Oklahoma and South Carolina reporting a record number. While seven other states recorded higher numbers earlier this week, with Texas considering a local lockdown to curb the spread of the virus.
As the situation worsens, news came of President Donald Trump’s administration closing federal funding for 13 Covid-19 testing sites, according to CNBC. This includes one in Texas where 5,500 new cases were reported in just one day and hospitals reach capacity.
The Dow Jones rose 0.17 per cent while the benchmark S&P 500 edged up 0.17 per cent. The tech-heavy Nasdaq Composite is trading up 0.25 per cent after reaching record highs last week.
A barrage of economic data did little to help stocks regain the losses of the week. Weekly jobless claims rose to 1.48m, fewer than in the previous week, while continuing claims decline to 19.5m.
“The outlook, however, is deteriorating as inconsistent guidance from public officials combined with the failure of individuals to comply with the most basic Covid avoidance measures have led to another surge in infections,” said Ronald Temple, head of US equity at Lazard Asset Management.
“These unforced errors are increasing the risk that cities and states may be forced to pause or even reverse reopening which could derail the nascent economic recovery.”
The government also confirmed that the US economy contracted by five per cent in the first quarter, in line with expectations.
Get the news as it happens by following City A.M. on Twitter.