Below are our top 10 stories that you need to know about. Be sure to check our twitter page for regular posts of important headlines. Click on the links for full stories.
Opinion articles of the week:
- HSBC thinks that the turmoil in the Chinese stock markets is drawing to an end. Click here to find out why.
- Global trade is slowing down. Click here to find out why some analysts think the reason for this is.
- Peter Praet, ECB Executive Board Member and Chief Economist, produced a presentation on how the euro has failed the Eurozone economy. Click here for why he believes the euro has failed.
1. GLENCORE SHARE TROUBLES
Swiss mining company Glencore have had an extraordinarily turbulent week. Share prices dropped by 29% on Monday (Bloomberg) largely due to tumbling commodity prices, most pertinently copper, which has fallen by 18% this year and is expected to continue falling. Glencore is the world’s biggest copper supplier, and gets about 28 percent of its earnings from copper mining. (Bloomberg) Fortunately for Glencore, it clawed back it share value losing only 2.3% of its share price. That was with the help of non-executive director William Macaulay buying £1.7 million worth of shares (City A.M.). Despite this spectacular rally, Glencore’s shares have lost $44 billion in market value this year. The company is urgently finding ways to restructure its $30 billion worth of debt and to remain profitable amid tumbling commodity prices.
2. UK ECONOMY GROWS
GDP per capita in Britain is 0.6% above pre-recession peak. Britain’s economy, which has grown for 10 straight quarters, is continuing to strengthen. The data from the ONS showed that the economy was 5.9 percent bigger in the second quarter than the previous peak. In response to the news, the pound rose 0.2% to $1.5176 and rose by 0.5% to 73.88 pence per euro. (Bloomberg)
3. CONSUMER RIGHTS ACT 2015
The right to get a full refund for a faulty item for up to 30 days after purchase, became law as of 1st October 2015. This the just one of the key consumer protection measures brought under the Consumer Rights Act 2015. The Act also provides new protection for people who buy digital content, such as ebooks or online films and music. One key legal change is the enabling of UK courts to hear US style class action law suits, where one or several people can sue on behalf of a larger group. The Act has been welcomed by many consumer rights groups. For more on the Consumer Rights Act and the changes click here. (BBC News)
4. UK M&A ACTIVITY UP 58%
UK merger and acquisition activity is up 58% from last year, according to a report released this week. UK companies contributed £186bn so far this year to the global M&A total. This is largely due to a significant increase in inbound investment which reached $174bn, up 2.7 times from $64bn over the same period last year. There has been a 15 per cent increase in Europe-UK deals. (City A.M.)
5. FCA TO INTRODUCE PPI COMPLAINTS DEADLINE
The Financial Conduct Authority announced that it is considering introducing a 2 year deadline for PPI claims to bring an end to the Payment Protection Insurance scandal. The FCA noted evidence brought forward for PPI claims is becoming “increasing stale” and noted that a significant proportion of complaints made turn out not to have involved a PPI sale. They also mentioned the “open-ended nature” of PPI claims meant there was no urgency amongst consumers to make a claim. Any plans would not come into force until spring 2016 at the earliest meaning consumers would have until 2018 to bring their claim forward. (City A.M)
6. MICROSOFT AND GOOGLE END PATENT WARS
Microsoft Corp. and Google Inc. have agreed to bury all patent infringement litigation against each other, settling 18 cases in the United States and Germany. Many analysts believe that this signifies a slowing down of the global smartphone wars. This ends a number of courts involving a variety of technologies, including mobile phones, wifi, and patents used in Microsoft’s Xbox game consoles and other Windows products. (Bloomberg)
7. NEW BANKING REGULATIONS PUT JUNIORS AT RISK
From March 2016 managers at U.K. banks will face much stiffer accountability to the Financial Conduct Authority and the Prudential Regulation Authority for lapses that take place on their watch. Employment lawyers feel that lower-ranking bankers could be unintended victims of the new rules and we will see a surge in unfair dismissal claims as a result. The FCA and PRA are looking to impose much more individual responsibility for any failures that occur in the banking sector. (Bloomberg)
8. SSI STEEL GOES INTO LIQUIDATION
Sahaviriya Steel Industries (SSI) UK, which owns the Redcar steelworks, has gone into liquidation. On Monday, it announced that the Redcar steelworks plant on Teesside was to be closed, with the loss of 1,700 jobs. The government made an aid package of “up to £80m” available for those affected but has ruled out state intervention at the plant. (BBC News)
9. SHELLS STOPS ARCTIC DRILLING
Shell has abandoned its controversial drilling operations in the Alaskan Arctic in the face of mounting opposition from environmentalists. Shell has spent over $7bn (£4.6bn) on its failed hunt for oil which critics said could only endanger one of the world’s last pristine environments. Shell said it would have to take a hit of around $4.1bn on future earnings as a result of the decision but it is unclear what the final bill will be. (The Guardian)
10. BRICKMAKER IBSTOCK FLOATS
Brickmaker Ibstock has announced its intention to list on the London Stock Exchange in October. It has performed well financially in recent months partially due to government house-building programmes. It hopes to raise £1bn from the floatation and is being advised by law firm Allen & Overy. (The Lawyer)