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.
Brexit Opinion articles of the week:
Will the Brexit mean higher food prices and staff shortages? Click here for the debate.
Will the weak pound post-Brexit help UK exports? Click here for more.
Was the Brexit vote a “precarious calm” before the real storm? Click here for more information.
1. BANK OF ENGLAND
Mark Carney has announced that the Bank of England is likely to cut interest rates in the coming months to cope with a post-Brexit slow down. (The Independent)
Last week, the UK central bank also injected £3.1bn into the banking sector. Three special auctions, where the Bank of England makes extra funds available to banks, were planned around the EU referendum to shore up the financial system.
The £3.1 billion released on Tuesday was the last of the extra auctions announced by the Bank of England in March this year. Lenders have taken more than £9 billion from the central bank in June. The special funding was described as a “precautionary measure” to make banks they have the necessary cash to cope with any turmoil caused by the referendum.
This was the first time the Bank of England has ever held more than one of these special auctions in a month. (The Independent)
2. GEORGE OSBORNE’S PLEDGES AND WARNINGS
George Osborne has pledged to cut corporation tax to encourage businesses to continue investing in the UK following the EU referendum vote.
In an interview with the Financial Times, the chancellor said he would reduce the rate to below 15% – some 5% lower than its current 20% rate.
That would give the UK the lowest corporation tax of any major economy. (BBC News)
He also warned last week however, that we should expect the next Conservative government to cut spending and raises taxes it was “very clear” that Britain will be poorer following our Brexit decision. (The Independent)
3. BORIS JOHNSON DROPS OUT OF TORY LEADERSHIP ELECTION
Ex-London mayor Boris Johnson has ruled himself out of the race to be the next Conservative leader and prime minister.
In a speech in London – billed as his campaign launch – Mr Johnson said he did not believe he could provide the leadership or unity needed.
It comes after Justice Secretary and fellow Brexit campaigner Michael Gove’s surprise announcement last Thursday morning that he would run for leader. The other candidates are; Home secretary Theresa May, Energy minister Andrea Leadsom, former Defence Secretary Liam Fox and Work and Pensions Secretary Stephen Crabb.
Click here for the speech and more on the leadership race. (BBC NEWS)
Tory MP’s began voting today (5th July)
4. ABinBEV SABMILLER DEAL CLEARS IN SOUTH AFRICA
South Africa cleared Anheuser-Busch Inbev’s $100 billion-plus deal to acquire SABMiller (SAB.L) on Thursday, putting the world’s largest brewer “on track” to complete the merger within the next six months.
The Competition Tribunal, which gives the final word on mergers in Africa’s most industrialized country, said in a statement that concessions made by AB InBev to get the deal approved were designed to address both public interest and competition concerns arising from the merger.
The merger will bring together AB InBev’s Budweiser, Stella Artois and Corona brands with SABMiller’s Peroni, Grolsch and Pilsner Urquell and brew almost a third of the world’s beer, dwarfing rivals Heineken and Carlsberg.
Having secured South Africa’s approval for the deal AB InBev Chief Executive Carlos Brito said it was on track to close the merger in the second half of 2016, adding that South Africa was “a market that would play a critical role in the combined company.”
The takeover would be the largest made of a British-based company and the fourth-biggest overall of any corporation. Analysts and investors who have been nervous about opposition from the unions in South Africa and expected delays from the regulators breathed a sigh of relief after the announcement. As part of the conditions, the Tribunal ruled that no South African employee could be laid off for five years after the merger.
The two key approvals required are by the United States and China, although the proposed disposals there are expected to lead to clearance. Australia and Europe have already given their blessing to the deal. (Reuters)
5. VOLKSWAGEN DIESELGATE SETTLEMENT
Volkswagen has revealed details of a $14.7bn (£11bn) settlement in the United States relating to its diesel emissions tests scandal. In the largest consumer class-action settlement within the automobile industry in US history, the company must offer to buy back almost all of the 475,000 cars affected, or terminate their leases, at a cost of just over $10bn (£7.5bn).
Car owners will be able to choose whether they sell their car back to Volkswagen or get a repair. Depending on the age of their vehicle, US owners of VW cars with 2.0 litre diesel engines will be compensated by between $5,100 and $10,000.
The average value of a VW diesel vehicle has fallen by 19% since before the scandal began in September 2015. Those who choose the buy-back option, will therefore be eligible to the trade value of their car before this date.
In addition, the company has to pay $2.7bn for environmental mitigation and another $2bn for research on zero-emissions technology, a source told AP. (Sky News)
6. MICROSOFT PROFITS SET TO FALL AS PC MARKET DECLINES
Microsoft may be pitching itself to investors as a cloud computing powerhouse and a savvy dealmaker these days, but sliding PC sales around the world still have a bigger impact on the software company’s bottom line.
Jefferies analysts cut their revenue and earnings expectations for the next two years this week, citing the latest forecasts from Gartner IT. The industry research firm now expects PC sales to decline 7.3% in 2016, after previously projecting a 1% decline.
Worldwide PC shipments totaled 64.8 million units in the first quarter of 2016, down 9.6% from a year earlier and the sixth-straight quarter of declining sales. For the first time since 2007 shipment volume dropped below 65 million units.
Considering the lack of evidence that PC sales will rebound, or even stabilize, Jefferies expects Microsoft earnings to come in at $2.78 per share for fiscal 2017, well below the $2.88 Wall Street consensus. DiFucci has an underperform rating on the stock. (Forbes)
7. HERTZ UBER DEAL
Hertz Global Holdings Inc. reached agreements with Uber Technologies Inc. and Lyft Inc. to supply U.S. drivers with vehicles, the rental-car company said in statements Thursday morning.
The Lyft deal builds on pilots in Las Vegas and Denver, providing set rates for drivers, who will be serviced from dedicated off-airport Hertz locations, it said. The program is expanding to Los Angeles and San Francisco with more markets expected to follow, Hertz said.
The Uber agreement is starting with the Los Angeles area, Hertz said. (Bloomberg)
8. NEWCORP TO ACQUIRE TALKSPORT OWNER £220M
The media giant behind The Sun and The Times newspapers is diving into the digital radio market by making a £220 million swoop for the owner of TalkSport. News Corp said it had moved to snap up the Wireless Group because it made an “excellent strategic fit” and would strengthen its digital business.
The cash offer will see Wireless shareholders receive 315p per share, while named shareholders from May 20 this year will pocket a special dividend of 6.15p and a final dividend of 7.6p.
Rebekah Brooks, chief executive of News UK, said the deal would allow News Corp to build on its “growing digital success story” and “bring some of the best journalistic and broadcasting talent into one group”.
Wireless owns Virgin Radio UK, TalkRadio and TalkSport radio, which has the radio and digital broadcasting rights to the Premier League and the FA Cup,
News Corp said the takeover, which still needs to win regulatory approval and the backing of Wireless shareholders, represents a premium of 70.3% of Wireless’s closing share price of 185p on Wednesday. (Business Reporter)
9. FCA FINES PLUMMET FOR 2016
Fines imposed by the Financial Conduct Authority (FCA) in the first half of 2016 have fallen to £7.2m – less than 1% of the figure of a year before.
The plunge in fines from £819m in the same period last year follows a period of turbulence for the FCA and coincides with the arrival of Andrew Bailey from the Bank of England as the watchdog’s chief executive.
The number of fines has also fallen, almost halving to 13 from 24 in the first half of last year. Eight of the fines, totalling £3.2m, resulted from an investigation into the failure of insurance schemes for law firms. Two companies and six people were fined.
George Osborne forced out Martin Wheatley, the FCA’s previous chief executive, a year ago after the City complained about his tough approach to regulation. After the Conservatives won the May 2015 election, Osborne said he wanted a new settlement with the banking sector and an end to blaming them for the financial crisis.
Tracey McDermott, who was closely linked with Wheatley’s hard line, took over running the FCA but dropped out of the running for the permanent job in January after an inquiry into banks’ culture was scrapped. McDermott denied there had been any softening of the FCA’s approach. (The Guardian)
10. APPLE PATENTS RECORDING PREVENTION DEVICE AT LIVE SHOWS
Apple just had a patent approved by the U.S. Patent and Trademark Office that would disable iPhone cameras from recording or photographing live shows.
The patent, originally applied for in 2011 but only officially granted this week, was for “Systems and Methods for Receiving Infrared Data with a Camera Designed to Detect Images Based on Visible Light.”
The technology basically involves an infrared device that an artist would set up on stage to beam out encoded signals. A receiver (aka your iPhone) would decode that data, rendering the screen incapable of recording.
There is significant debate over whether this would harm iPhone sales if Android doesn’t follow suit. (NBC News)