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Markets: The Nikkei closed down 1.18 per cent this morning at 16,360.71. IG is calling the FTSE 100, which closed at 6,816.90, to open 5 points lower. At 6.51am Brent crude was trading at $49.51 a barrel and against the dollar the pound was trading at $1.32 and against the euro at €1.16. For more markets coverage see the snap below and don't forget to follow me on Twitter for market updates throughout the day - @fletcherr. Good morning: All eyes turn today to Jackson Hole, the mountain resort in America’s cowboy country where the world’s top central bankers have gathered to discuss the future of monetary policy. “Markets have been treading water ahead of this afternoon’s keynote speech from Janet Yellen, chairwoman of the US Federal Reserve. Traders will be parsing her words for any hints about the trajectory of interest rates,” writes Philip Aldrick, our Economics Editor in this morning’s paper. You can read his full report here. Ahead of that we get the revised reading for second quarter gross domestic product from the Office for National Statistics at 9.30am. Economists expect GDP to remain unchanged, with a 0.6 per cent quarter-on-quarter rise. On the corporate front Segro - the property company I still call Slough Estates - has announced the sale of an industrial estate near Heathrow this morning. We have also got interim results from Frankie & Benny's owner The Restaurant Group and paving company Marshalls. Have a great bank holiday weekend. If you get a chance, catch up on this week’s business podcast: Robert Miller talks income stocks and the pensions crisis with Martin Waller, Philip Aldrick and Deirdre Hipwell. I’m off for a week’s break in Cornwall. Martin Strydom, Digital Business Editor, will be setting his alarm even earlier to bring you the morning email.
Finally, an apology: my rather poor typing skills inserted an error into yesterday’s email, giving an unwarranted boost to the value of the euro. Sorry.
Richard Fletcher
Business Editor
The Times
richard.fletcher@thetimes.co.uk |
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1 Housing construction grew by only 2 per cent in the past year, far below the rate needed to meet the government’s target of building a million new homes by 2020. Builders started work on 144,280 homes in England in the year to June.The target requires an average of 200,000 new homes to be built each year. Page 6 2 Britain would save £1 billion a year by ditching the Hinkley Pointnuclear project in favour of less risky schemes that would meet the country’s energy needs, according to new analysis by the Energy and Climate Intelligence Unit. Page 20 3 Japan’s largest airline, All Nippon Airways, said that it had been forced to cancel up to 300 flights over the next month while it investigated a problem with the Rolls-Royce engines in its fleet of Boeing 787 Dreamliners. 4 The influential Investor Forum, whose members manage £14 trillion of assets, has called on Sports Direct to reform fundamentally its corporate governance as pressure mounts on Mike Ashley’s sportswear group. 5 Consumer spending surged to a six-month high in August as tourists flocked to UK high streets to take advantage of the weak pound and the hot summer and provided a big boost to Britain’s retailers, the CBI said. 6 News publishers will be able to raise fees on internet platforms such as Google if search engines show selections of their stories, under radical copyright reforms being finalised by the European Commission. The proposals, to be published next month, are aimed at diminishing the power of big online operators. 7 Shares in CRH have soared to an all-time high after it increased its interim dividend for the first time in seven years, was bullish about the recovering US economy and was fêted by analysts for its successful takeover of Tarmac. The Dublin-based construction materials group doubled its underlying operating profits to €1.1 billion. 8 Lord Bell, 74, the PR guru favoured by Margaret Thatcher, is stepping away from the company he founded with immediate effect. Bell Pottinger said that he “would like to step back from the day-to-day running of the business”. He will continue to provide advice through a new business, Sans Frontières, to be formed next year. 9 Playtech, the Israeli gaming technology company, is betting on further acquisitions to drive growth after reaching into its war chest yesterday to pay investors a special dividend worth about €150 million. 10 Deals involving discount retailers have not only allowed the businesses’ founders and executives to cash in their shares but also revealed the extent of investor and consumer interest in the fastest-growing part of a tough sector.
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“The frustration churned up here, in Europe and in the US derives not from economic challenges but from the way our governments have responded.” If you are looking for economic explanations for the rise in populism, you won’t find them, argues Ed Conway. “Here’s a jaw-dropper: Sports Direct is not quite up to snuff on the corporate governance front. Astonishing, no? And to think Mike Ashley, the retailer’s 55 per cent owner, has always seemed such a stickler for stock market rules.” Sports Direct’s independent shareholders hardly look the most proactive types: it’s taken them a decade just to get to here, says Alistair Osborne. “I’ll know my home town has truly regenerated when it has a really good hotel. When a company such as Tata, which owns Jaguar Land Rover, sponsors an arts festival in the city, instead of going all the way to Hay-on-Wye to do so. And, yes, when you can order a glass of prosecco as easily as a pint of bitter.” The ‘poncey’ obsessions that animate London elite could revive the regions, argues Sathnam Sanghera. |
The FTSE 100 drifted towards the extended holiday weekend, falling 18.88 points, or 0.28 per cent, to 6,816.90 amid caution ahead of today’s speech from Janet Yellen, chairwoman of the US Federal Reserve, which could shed light on the trajectory of US interest rates. The broader FTSE 250 closed down 131.80 points, or 0.73 per cent, to 17,882.85. More on yesterday’s market action here. On Wall Street, shares finished modestly lower led by a drop in healthcare and consumer-focussed companies in a lightly traded session ahead of the Jackson Hole central bankers’ symposium which starts today. The Dow Jones Industrial Average finished down 0.2 per cent, or 33.07 points, at 18,448.41 while the S&P 500 fell by 0.1 per cent to 2,172.47. Around 5.5 billion shares changed hands compared with the recent daily average of 6.5 billion. Sterling edged down from a three-week high in London yesterday - down 0.4 per cent to $1.318 - as worries about the economic impact of the Brexit vote are easing after better-than-expected data. Against the euro, the pound was 0.5 per cent lower at €1.169. Oil prices rose even though Khalid Al-Falih, the Saudi Arabia energy minister, told Reuters that he does not believe it is necessary for any “significant intervention” in the market to tackle the global supply glut. In New York, Brent crude for October delivery rose by 1.3 per cent to $49.68 a barrel. |
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| The Times |
Japan's largest airline, All Nippon Airways, said that it had been forced to cancel up to 300 flights over the next month while it investigated a problem with the Rolls-Royce engines in its fleet of Boeing 787 Dreamliners. In another setback for the British engineering group that is likely to cost tens of millions of pounds, maintenance staff at the carrier found corrosion on turbine blades in the Trent 1000 engines that Rolls exclusively provides for ANA's 49-strong Dreamliner fleet. The problems were discovered during the investigation of an incident in February, when a Dreamliner had to shut down an overheating engine and return to Kuala Lumpur airport in Malaysia. The issue has affected two other flights, according to Takeo Kikuchi, deputy senior vice-president of engineering and maintenance at the Japanese airline. The most recent was a domestic service on August 20. |
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| The Wall Street Journal |
Volkswagen AG reached an accord to help U.S. dealers affected by its diesel-emissions crisis while struggling to convince U.S. regulators to accept a fix for some half a million polluting vehicles on the road, even if they can’t be made fully compliant with emissions regulations. The proposed deal with U.S. dealers, which will include a payout and other concessions, should help “to heal the wounds between the dealers and Volkswagen,” Steve Berman, an attorney for the dealers, told U.S. District Judge Charles Breyer in San Francisco. Judge Breyer set a Sept. 30 deadline to complete details of the dealer agreement. Hinrich Woebcken, chief executive of Volkswagen’s North American business, called the agreement “a very important step in our commitment to making things right” in the U.S. Since disclosing nearly a year ago that it installed devices in some 11 million diesel-powered vehicles worldwide to enable them to cheat emissions tests, Volkswagen has faced legal challenges around the globe. |
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| The Daily Telegraph |
Legal & General, the UK's biggest pension fund manager, has come out swinging against Sports Direct by revealing it will vote against the retailer's chairman and all its non-executive directors at the sportswear chain's meeting next month. It will be the third consecutive year the largest investor in UK companies has voted against Keith Hellawell and in that time Sports Direct's shares have more than halved. Sacha Sadan, director of corporate governance at Legal & General Investment Management, said the firm would be also voting against all of the non-executive directors "as we believe that Sports Direct needs a stronger body of independent non-executive directors to ensure the business is run in the interest of all shareholders. "We are disappointed that there have been no new non-executive board appointments in the past five years." Mr Sadan also confirmed that he would be supporting a resolution, proposed by trade unions, to form an independent review of Sports Direct's labour practices. |
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| Financial Times |
European news publishers will be given the right to levy fees on internet platforms such as Google if search engines show snippets of their stories, under radical copyright reforms being finalised by the European Commission. The proposals, to be published in September, are aimed at diluting the power of big online operators, whose market share in areas such as search leads to unbalanced commercial negotiations between search engines and content creators, according to officials. The move will heap further pressure on the strained relationship between Silicon Valley and Brussels, which are embroiled in increasingly fractious arguments over issues covering competition, tax and privacy. This week, the US Treasury department attacked commission moves to levy billions of euros from Apple for alleged underpayment of taxes in Europe. Under the draft copyright plan, news publishers would receive "exclusive rights" to make their content online available to the public in a move that would force services such as Google News to agree terms with news organisations for showing extracts of articles. Citing dwindling revenues at news organisations, the commission warns that failure to act would be "prejudicial for ... media pluralism", according to one internal document. |
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