- In MACROECONOMIC NEWS, Sunak announces new measures
- In TECH NEWS, ByteDance seeks Chinese approval, developers get together to fight Apple, Amazon has a reveal event and ChargePoint aims to go public
- In CONSUMER TRENDS & RETAIL NEWS, workers look outside London, we spend on furniture, Cineworld looks tricky and Pets at Home powers up
- AND FINALLY I bring you some of Waitrose’s finest produce…
So Rishi Sunak makes some tough announcements…
Sunak sets up moment of truth for UK jobs market (Financial Times, George Parker, Chris Giles, Jim Pickard and Daniel Thomas) highlights yesterday’s pronouncements from the UK chancellor Rishi Sunak. He confirmed plans to bring the furlough scheme to a close and to replace it with a German-style wage subsidy scheme instead. From October 31st, the Treasury will only subsidise wages for people who work at least a third of their usual hours, meaning that anyone who could not work any of their normal hours would not be covered. He acknowledged that “I cannot save every business. I cannot save every job” as his new plans shift the burden of supporting jobs away from the government and onto the employers. He also extended 5% VAT for restaurants, hotels and cinemas until March 31st next year, announced more support for self-employed workers (but this was only at 20% of average monthly trading profits versus 70 and 80% of trading profits previously) and extended the life of four loan schemes.
Retailers face £8bn bill when rates resume in April (Daily Telegraph, Laura Onita) shows that retailers will have to pay an £8bn bill when the business rates holiday comes to
an end at the beginning of April. Retailers were hoping for an extension from the original agreement but didn’t get it. Unfortunately, the rates are based on property rental values that were last assessed in 2015 and which are not due to be revalued until 2023 – so they are likely to be high. * SO WHAT? * Of course the British Retail Consortium is going to say that its members need more “certainty” and that the business rates holiday should be extended, but then the government countered that by saying that retail sales rebounded to pre-coronavirus levels in August. No one is going to be satisfied and everyone is quite rightly fighting their own corner in order to survive.
The winners and losers from new plan to protect jobs (Daily Telegraph, Marianna Hunt) is an excellent article that summarises the impact on specific groups of people of the new measures. Winners include those coming off furlough (because the offer of some money may convince employers to keep staff on for a bit longer), most self-employed (who will have access to a few grants and be able to spread their tax due) as well as SMEs (who will be able to access the Jobs Support Scheme and extend the terms of their Covid loans to up to 10 years). Losers include the self-employed who missed out on government support last time, big businesses (who will have to start making people redundant on October 1st) and jobs in the arts and sport as venues remain closed.
TikTok owner puts deal with Oracle, Walmart in Beijing’s hands (Wall Street Journal, Liza Lin) reflects the latest development in the ongoing TikTok saga as its owner, ByteDance, said yesterday that it has submitted its plan to join up with Oracle and Walmart to the Chinese Commerce Ministry. On Wednesday night, TikTok asked a federal judge in Washington, D.C. to stop Trump from imposing a US download ban and at a hearing yesterday, Judge Carl Nichols told the Trump administration that it had until Friday afternoon to postpone the download ban or defend it in court. He added that if the government didn’t act to postpone the ban by 2.30pm today he will hold a hearing on Sunday morning to decide for them. * SO WHAT? * It seems that there is a pattern forming here as a group of WeChat users in the US got together to stop a proposed ban on the app, which the court upheld. The Chinese government has yet to comment on the latest TikTok deal, although state media has been slamming it all week, calling it “dirty and unfair”. The drama continues…
Developers form coalition to fight Apple over App Store practices (Financial Times, Patrick McGee) shows that a new group called Coalition for App Fairness has formed – bringing together 13 groups including Spotify, Epic Games, e-mail service Blix, Tile, Match Group and management tool Basecamp – in order to fight back against Apple’s alleged anti-competition behaviour. Although they have voiced support, Microsoft and Facebook remain conspicuous in their absence from the group. * SO WHAT? * This is what
they should all have done in the first place instead of taking on the Apple behemoth on their own. Still, even together, these groups are still small-fry in the scheme of things and the absence of some of the biggies is telling. As things stand, I still think they will lose – but at least disgruntled developers now have a rallying point of sorts.
Amazon event: tech titan unveils new home drone, speakers, gaming service (Wall Street Journal, Sebastian Herrera) highlights the rollout of a load of new gadgetry by Amazon yesterday. Devices include a home camera drone, a pivoting speaker with camera, a car alarm, a car camera, a cloud-connected game controller and gaming subscription service, among other things. * SO WHAT? * There is some seriously cool kit here, but given how much Amazon already knows about you and your habits do you want it to encroach even further into your home??
ChargePoint to go public in $2.4bn reverse merger (Financial Times, Peter Campbell) shows that the world’s biggest electric vehicle charging business will list its shares via a reverse merger with a blank-cheque company – which will help it to avoid a traditional IPO (something that Nikola did only a few months ago – just sayin’ 😜). It will trade on the New York Stock Exchange at an initial value of $2.4bn via a merger with Switchback Energy, which is a publicly listed Special Purpose Acquisition Company, aka “Spac”. The company wants to raise around $500m to fund its European and US expansion and will clearly try to surf the current wave of demand for battery-powered vehicles. * SO WHAT? * Sounds good in theory, but given recent events with Nikola, you would have thought that the avoidance of a traditional IPO and the scrutiny that brings could be questionable. Still, the business is more established and actually does something, so hopefully that will make things different – plus I think that the timing is pretty good given rising demand for EVs at the moment.
CONSUMER TRENDS & RETAIL NEWS
Consumer trends continue to evolve…
In a quick look at consumer trends at the moment, Rising number of Londoners looking for work outside capital, says job site (The Guardian, Hilary Osborne) cites figures from Indeed, which show that job searches outside the capital are increasing. I guess this correlates to real estate trends which show a bit of an exodus to the suburbs as more people move out of city centres and CBI reports
strong sales of furniture, DIY goods and groceries (The Guardian, Sarah Butler) shows what we are spending on (basically stuff to make us comfortable during lockdown).
On the other hand, we’re not spending on going to the cinema. Cineworld issues warning over future after £1.3bn loss (The Guardian, Kalyeena Makortoff) shows how badly this is affecting major cinema chain Cineworld, which says that it might not be able to survive another lockdown without more money. However, on a brighter note, Pets at Home’s hot streak after summer revival (The Times, Callum Jones) shows that we are spending a lot of money on our pets! The company’s share price shot up by 27.8% to new all time highs as it smashed expectations in its unscheduled trading update.
…in other news…
Today, I thought I’d bring you a real bit of creative thinking in Waitrose mocked by shoppers for selling £6 ‘autumn foliage’ as leaves are free outside (The Mirror, Courtney Pochin). Things are bad at Waitrose at the moment, so well done to the person who came up with selling leaves to its customers 😂!
Some of today’s market, commodity & currency moves (as at hrs green is up, red is down). THIS IS INTENDED AS A ROUGH GUIDE ONLY!
|FTSE 100 *
|Dow Jones *
|S&P 500 *
|Oil (WTI) p/b
|Oil (Brent) p/b
|Gold Per t/oz
(markets with an * are at yesterday’s close, ** are at today’s close)