Brexit: Boris Johnson new PM -markets up

The UK´s next Prime Minister is Boris Johnson. He won the majority of the votes in the Conservative Party elections and will move to Downing Street 10 after he has visited Queen Elizabeth in Buckingham Palace tomorrow. The Queen will formally appoint the new Prime Minister.

– We are going to get Brexit done on October 31st and we are going to take advantage of all the opportunities it will bring, in a new spirit of can do, Mr Johnson said after the voting results.

The stock markets were up in globally, partly of the good earnings results, for example from Coca-Cola and of positive signs in China-US trade talks. The US trade representative Robert Lighthizer will travel to China next week in order to continue the trade talks.

Dow Jones closed up 0,65 % to 27 349 points, the tech Nasdaq-index up 0,58% to 8251 points and S&P 500 index +0,68 % to 3005 points, reaching over 3000 points.

In Europe the FTSE 100 index closed up 0,56 % to 7556 points in London, the DAX-index closed up 1,64 % to 12490 points and in France the CAC 40 index closed up 0,92 % to 5618 points.

In Asia the stocks also rose in Tuesday. The Nikkei index closed up 0,95 % to 21 620 points and Hang Send in Hong Kong rose 0,34 % to 28 466 points. The Shanghai Composite rose 0,45 % 2899 points.

The euro was trading 1,11 dollars. The UK sterling was at 1,11 euros and at 1,24 dollars.

Business Finance

Brexit: Weekend elections – ECB rate cut? (corrected)

Corrected: the Conservative Party elections timetable

The Brexit situation in the UK will move forward when the Tories had their elections for the next Prime Minister and party leader. The markets are considering Boris Johnson the likely winner to place the former Prime Minister Theresa May. The other candidate is foreign minister Jeremy Hunt.

The next UK Prime Minister, which name will be published during the beginning of this week, will lead the country out of the EU block, with or without a trade deal by the October 31st.

In the UK the sterling has decreased to its lowest levels in 2 years. The FTSE 100-index is trading up 0,45 % to 7542,86 points today.

The financial markets have seen the global interest rate easing starting this time in Asia. For example the South Korea and Indonesia have lowered their interest rates last week. Now the expectations are for the US Fed and European Central Bank, which is having its next meeting on July 25th. According to Reuters, markets are waiting for a 10-basis point cut with 60 % chance.

During this week there will be also earnings releases from Facebook (FB) on Wednesday and Alphabet (GOOG) on Thursday, as well as Amazon (AMZN)

Business Finance

US-UK trade deal on the agenda

The US and UK have been discussing about the trade deal between the countries after the Brexit deal, which is estimated to happen latest October 31st. This is part of the state visit of the US President Donald Trump and the UK royal family & Government.

According to the news conference on Tuesday, Mr Donald Trump said that the US-UK trade deal would have “tremendous potential” and coverage, even maybe the health care system NHS.

He also mentioned that the UK Brexit deal with the EU countries “will happen and should happen” and that it is important to deliver the Brexit. The US is offering the UK a broad free-trade agreement once the country has left the EU.

The UK Prime Minister Theresa May said also in the news conference that the UK should deliver the Brexit deal as the Goverment has been negotiated and that it is now the duty of the UK Parliament.

Mrs May is leaving the Downing Street 10 on Friday and the next Prime Minister will be chosen by the Conservatives during the summer time, maybe in July in the UK.

Business Finance

Watches of Switzerland considering an IPO in London

The UK reseller Watches of Switzerland is considering an IPO in the London Stock Exchange.According to Bloomberg, the company is seeking funding for its US expansion.

The company is the biggest reseller of the luxury timespecies in the UK and they estimate more growth figures from the US markets. Private-equity company Apollo Global Management is expected to keep a stake in the company.Barclays Bank and Goldman Sachs are acting as global coordinators.

Finance Lifestyle

UK to target net zero emissions by 2050? FT

The UK is targeting to set a new goal for carbon emissions. According to the report from Committee on Climate Change, UK should be net zero emissions country by 2050. This would equate to 1-2 % of the 2050 GDP, says Financial Times.

FT says that the report, which will be published on Thursday, will guide Scotland to be net zero already in 2045 and Wales 95 %zero in 2050 due to its sheep-farming industry.

The UK Parliament is expected to discuss about the Climate Change updates on Wednesday,when the House of Commons will have this topic on its agenda.The target would be reached by using more renewable energy sources, increasing the electric vehicles in transportation and for example capturing carbon from the air.

In 2018 the UK carbon emissions fell by 2,5 % sixth straight years in row.About 80 % of the UK homes are warmed by using natural gas.

If this new target would pass the Parliament,it would mean that the UK would be among the leading G7 countries to set this kind of target.  It is good to remember that the UK will leave also the EU Emissions Trading System as part of the Brexit deal.

In London there have been several climate activists protests during the last two weeks in order to speed the decision making on Climate Change.

Business Finance

UK rating still at risk of no-deal Brexit – S&P and Fitch

The UK credit rating is still at risk from a no-deal Brexit,says the S&P Ratings and Fitch Ratings according to Reuters. 

– The agreement between the EU and the UK to further extend the process to the end of October 2019 reduces but does not eliminate the risk of a no-deal Brexit over the next six months, Fitch said on Friday.

The UK Goverment has been negotiated with the EU leaders and the UK Parliament in order to avoid this kind of situation and thus avoid the possible economic and financial stress elements. Both credit agencies have a AA rating on the UK Goverment debt.

S&P has a negative outlook for the British economy and according to the agency the outlook could be revised to stable if there will be more certainty about the negotiations with the EU.

Business Finance

Brexit: Voting of delay in the UK Parliament today

The UK Parliament is voting also on Thursday about the Brexit delay. One of the options is that the Cabinet’s timetable leaving on the 29th March is extended if the EU accept the delay. Today´s voting can lead to different outcomes: a delay, the passing of the Cabinet’s Brexit deal anyhow as last minute, no-deal exit or another referendum.

The EU Commission confirmed on Thursday that the delay would require a justification but also the comments from member countries for example from Germany and Ireland showing their interest to find a sound solution to the situation.  It is assumed that EU would prefer only a short extension ending before the EU parliamentary elections on May 24-26.

No-deal Brexit would mean that there would not be transition period to soften the distruption to trade and business.

The stock markets were up on Thursday trading  in Europe and for example the Frankfurt DAX-index was up 0.42 % to 11 572 points and in Paris the CAC 40 -index was up 0,69 % to 5306 points. In London the FTSE all share index was up 0,14 % to 3926 points.

The UK sterling ws down 0,41 % to 1,328 dollars and euro was down 0,04 % to 1,1323 dollars.

Business Finance