Brexit: May to propose new deal in June

The Brexit situation in the UK changes very rapidly. Last week the Labour Party leader Jeremy Corbyn said that the talks with the Goverment has ended due to the rising talks of the new successor to PM and due to the deal issues itself. On Sunday the Prime Minister said that she is to present a new deal to the Parliament in the early June, as she earlier said.

The successor issue to Mrs May is confusing the negotiations in the UK and according to Bloomberg News, it seems that the Labour Party is turning towards to the second referendum. For corporates and business, this means that the no-deal Brexit might still be an option.  “A messy exit could still happen by accident”, said British Chambers of Commerce according to Bloomberg.

In the London Stock Exchange, the FTSE 100 index was trading down 0,03 % to 7333 points. In Germany the DAX-index was trading down 0,15 % to 12 220 points and in France the CAC 40 -index down 0,21 % to 5426 points.

The pound was trading slightly up, 0,21 % to 1,275 dollars and euro also up, 0,04 % to 1,116 dollars. The Australian dollar was up, 0,93 % to 0,69 US-dollars.

The trade war between the US and China is one of main topics. According to Bloomberg, 34 % of the investors surveyed by the Bank of America said that they have purchased protection against a sharp decline in the equities over the next three months.

US President Donald Trump has delayed the possible auto tariffs with the EU with 6 months delay.

In Asia the week started mixed as the Hang Song index ended down 0,56 % to 27 788 points in Hong Kong, but the Nikkei 225-index ended up 0,24 % to 21 301 points in Tokyo. The Indian Sensex index increased 3,07 % to 39 095 points.

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US IPOs are expected to continue- WSJ

The recent ride-hailing IPOs have not caused the delaying of other IPOs in the row, writes the Wall Street Journal today. Although the Uber (Uber)  and Lyft (Lyft) share prices are down 7 % and 25 % respectively from their IPO prices, the IPO window is still open.

The newspaper reminds that for example Zoom Video Communications (ZM) and the plant based protein food producer Beyond Meet (BYND) were up 150 % and 257 % from their offerings. Pinterest (PINS) fell on Friday after the quarterly report, but it is up 41 from its IPO level.

Other listings on Friday, the content delivery company Fastly (FSLY) ended nearly up 50 % to 23,99 dollars and the Chinese “Starbucks coffee” Luckin Coffee (LK) also had a strong market debut.

According to WSJ and Dealogic, the IPO May listings totalled so far 15,22 billion dollars, while the sum was 6,23 billion dollars in April and 4,79 billion dollars in March.

Companies, that are still on the pipeline, are for example cybersecurity Crowd Stick and messaging company Slack Technologies, hotel reservations Airbnb and office space rental company WeWork.

On Friday the SP& 500 index ended down 0,58 % to 2859 points, the Dow Jones ended down 0,38 % to 25 764 points and Nasdaq down 1,04 %  to 7816 points.

In Asia the Nikkei rose 0,89 % to 21 250 points in Tokyo, while in Hong Kong the Hang Seng index went down 1,16 % to 27 946 points.

In Europe, the German Dax-index ended down 0,58 % to 12 238 points and in London the FTSE 100 index also down 0,07 % to 7348 points.

The sterling traded at 1,27 dollars and at 1,139 euros. The US dollar was trading at 109,98 yens.

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Brexit: Cross-party talks ended

The UK Labour Party announced on Friday that the talks with the UK Government over Brexit have ended. According to information from Mr Jeremy Corbyn “the talks have now gone as far as they can” and that the Party did not see that the compromise would have reached from both sides.

The pound slipped after the news and was trading as low as 1,275 dollars and 1,142 against euros. One of the reason for the announcement was also the speculation of the possible successor to Prime Minister Theresa May during the summer time. According to Labour Party, the increasing concern than any deal would have had risks to be accepted by the possible successor to Prime Minister.

The London Stock Exchange closed down for the week, losing 0,07 % to 7348 points. Other European markets were trading also down, DAX index down 0,58% to 12238 points and CAC40 down 0,18 % to 5438 points.

Business Finance

US to end steel and aluminum tariffs with Canada and Mexico – WSJ

US Government is ending the steel and aluminum tariffs with Canada and Mexico. According to Wall Street Journal, the US Government have reached a deal with these countries on Friday.

Canada and Mexico government representatives have confirmed that the deal has been made although more information is coming in the next few days.

The US Government is working to get the US-Mexico-Canada Agreement (USMCA) passed. According to Canada, the both countries have agreed to terminate all pending litigation between them at the World Trade Organisation regarding the metals.

This USMCA was signed in November by the three countries, but it needs the ratification still.

 

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Burberry Group revenue 2,7 billion pounds

The UK luxury company Burberry (BRBY) reported preliminary fiscal figures in London today. According to the release, the 12 month revenue was 2,7 billion pounds, nearly at the same level as year before. The operating profit increased by 7 % to 438 million pounds.

– We made excellent progress in the first year of our plan to transform Burberry, while at the same time delivering financial performance in line with expectations. Riccardo Tisci’s first collections arrived in stores at the end of February and the initial reaction from customers is very encouraging. The implementation of our plan is on track, we are energised by the early results and we confirm our outlook for fiscal 2020, the CEO Marco Gobbetti said in the release.

Burberry said that the company continued to focus on financial and operational discipline.

– We delivered cumulative cost savings of  105 million pounds, ahead of plan, which was largely reinvested into consumer facing activities to support the transformation. In addition, we expanded the scope of our restructuring programme to increase our target from 120 million to 135 million pounds by the end of fiscal 2022 as we develop Burberry Business Services, the company said.

Burberry also was rated to the leading luxury brand in the 2018 Dow Jones Sustainability Index. The factors behind were the circular thinking of clothes and minimising the unnecessary use of plastics in the supply chain.

The company is listed on the London Stock Exchange since 2002, when the company had its IPO. The share price declined after the report by 5,91 % to 1808 pounds.

 

 

Business Finance

Goldman to buy United Capital Finance Advisers for 750 million dollars

The US Investment Banking Group Goldman Sachs (GS) is buying a wealth-management company United Capital Financial Advisers for 750 million dollars. This would be Goldman´s biggest deal in recent years.

United Capital Finance Advisers has assets under management totally 25 billion dollars and the company employs 220 financial advisers. The deal is expected to be completed in the third quarter, Goldman said.

Goldman Sachs shares were trading today up 1,58 % to 199,50 dollars.

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China to develop fintech markets

China has taken several steps to enhance and engage with the opening of its capital markets towards western financial markets. Part of this process is also the new development of financial tech-companies and their regulation in the Chinese markets.

According to the China Securities Regulatory Commission, the signed MoU with China and France will allow information sharing on developing dynamics of fintech and its related regulation policies. The MoU was signed during the Chinese President Xi Jinping´s statevisit to France in April.

According to the press release of the Securities Regulatory Commission, the countries also reached a common consensus for enhancing mutual co-operation on green financing and promoting bilateral capital markets connectivity.

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