Lloyd’s of London sees pre-tax profit drop The Lloyd’s of London insurance market reported results on Wednesday, seeing a 30 percent drop in pre-tax profit to £2.1 billion. In a statement, Chairman John Nelson commented: “In a market undeniably tougher than seen for many years, we have had to demonstrate our ability to adapt and take action. In these conditions, these results are creditable.” Return on capital fell to 9.1 percent from 14.1 percent last year, with its combined ratio – a key measure of underwriting profitability – falling to 90 percent from 88.4 percent in 2014. Anything below 100 percent indicates a profit. Pound falls against the dollar, volatility increases The British Pound has sunk further against the US dollar this morning, down almost half a cent and extending losses that began yesterday. Traders cite uncertainty over the EU referendum as the main reason for the drop, which falls three months today. After a slight recovery over the last few weeks, the Pound is now soaring back down to six-year lows seen in February. The cost of insuring against a sharp fall in the pound also sky-rocketed this morning – another key sign of Brexit jitters. Three-month sterling volatility has hit levels not seen since the last general election, showing that traders expect significant changes over the next quarter. 2,000 more job cuts at Credit Suisse

Swiss bank Credit Suisse has announced another 2,000 strong job cut in its global markets business, adding to the 4,000 cuts announced last month.

The bank are currently in the throes of a plan to reduce annual costs by 800m Swiss francs a year, but are struggling with their “high and inflexible cost base” and “volatile market conditions”. Recently appointed chief executive Tidjane Thiam said the performance of global markets in general was “disappointing”, adding that “in this context, we have taken immediate action to reduce outsized positions in activities not consistent with our new strategy and systematically reduced our exposures”

23/03/2016

 

Petrobras hit by oil, post biggest loss

Brazilian energy company Petrobras has become the latest firm to see profits hit by the oil crisis, posting its biggest ever quarterly loss on Tuesday.

Petrobras’ net loss widened to 36.9 billion reais in the three months to December, after writing down billions worth of assets. At a press conference, its chief executive commented that it was an “extremely difficult year for the oil industry”, as oversupply caused prices to drop over 40 percent.

Petrobras (NYSE:PBR) shares fell by nearly 6 percent in after hours trading after the release of the results, but are currently up 1.35 percent at 5.64 (1130GMT). Petrobras are also currently in the midst of a major corruption scandal involving several high-profile government figures. George Osborne unlikely to hit deficit target Chancellor George Osborne is close to missing his target for cutting the budget deficit in the current financial year, according to official data released on Tuesday. Just days after releasing his 2016 Budget, figures suggest Osborne is unlikely to hit deficit goals for this year. His aim to bring the deficit down to £72.2 billion for 2015/16 will be difficult, as the budget already stands at 70.7 billion with one month to go until the end of the tax year. According to the Office for National Statistics, in order to meet his goal borrowing in March would need to fall to its lowest level since 2004. Travel shares cause FTSE to sink Travel and leisure stocks led the FTSE downwards this morning, after several major explosions in Brussels. The FTSE 350 Travel and Leisure sector was 1.6 percent down, with the FTSE 100 overall down 0.54 percent (1135GMT). Airlines IAG and easyJet were down 4 percent and 3.5 percent respectively, with Thomas Cook falling 5.4 percent and cruise operator Carnival down 3 percent. Explosions at both Brussels International airport and a metro station in the city centre took place at rush hour this morning. Updates are still being given.

22/03/2016

 

Manufacturing output fell to its lowest level since 2009, according new the latest survey from the Confederation of British Industry (CBI). Of the 471 manufacturers surveyed, just 18 per cent said output had gone up over the last three months, with 33 per cent reporting a fall. This means manufacturing output volumes fell to -15 in the three months to March, from 0 in February. However, manufacturers remain optimistic, with the expected volume of output balance rising to 23 per cent, well up on February’s 11 per cent. Rain Newton-Smith, director of economics at CBI, said: “Whilst total order and export books remained steady, a drop in output reflected some volatility in the food and drink sector. Reassuringly, manufacturers expect a swift turnaround in activity.”

21/03/2016

Apple are set to launch several new products today at a media event in Silicon Valley. Speculation has increased that the company will be launching a new iPhone model, rumoured to be an update of the 5S but with similar features to the iPhone 6. The launch will tap into the lower-end market, helping the company’s sales in the slow season between the major product launches in September. Apple are also widely expected to release a new iPad model, along with accessories for the Apple Watch. The media gathering will also give the company the chance to respond to press over its stance on the FBI case, something which Apple have refused to offer further comment on recently. Apple, supported by various other tech companies, are refusing to comply with the FBI’s request for them to hack into the phone of San Bernardino attacker Syed Farook.

Head of Australian stock exchange resigns amid bribery allegations

Elmer Funke-Kupper, the head of Australia’s stock exchange, has resigned after bribery allegations were founded against a betting company he used to run.

In a statement, Australian Securities Exchange chairman and interim chief executive Rick Holliday-Smith said:

“The ASX Board accepted that Elmer wanted to direct his full focus to the investigations which may be made into the Tabcorp matter – and not have them interfere with the important role of leading the ASX.”

Funke-Kepper has also taken leave from his position at Tabcorp, Australia’s biggest bookmaker, as the company under investigation deal with allegations that Tabcorp paid money to Cambodian Prime Minister Hun Sen’s family in an effort to drive expansion. FTSE, Asia and oil down The FTSE opened 0.5 percent lower this morning, following Asian markets downwards as oil prices spiral again. Most Asian stock markets also fell again on Monday, despite three consecutive weeks of gains. However, the Shanghai Composite and the Hang Seng have both pushed up into positive figures, with the Nikkei 225 remaining down 1.25 percent. Both European and Asian markets were hit by falling oil prices. According to data from Baker Hughes, US oil firms increased production last week after three months of cuts – fuelling oversupply concerns. CBI warns against Brexit The CBI have warned of a “serious economic shock”, should Britain decide to leave the EU in June. In a new report looking at the effects of Britain leaving the EU, it found that it would likely cost £100 billion to the UK economy, with nearly a million fewer jobs over the next four years if the UK leaves the EU and adding that a vote to leave would have “negative echoes” lasting many years.

21/03/2016

Growth to slow, warns IFS

Growth in wages and living standards may slow, according to the Institute for Fiscal Studies, after the 2016 Budget showed a weaker than expected economic outlook.

The think tank warned that “we should all be worried”, adding that:

“This will lead to lower wages and living standards, not just lower tax revenues for the Treasury.”

Oil hits 2016 highs

Oil has hit its highest level of 2016, with sentiment continuing to rise on the hopes of a production output meeting.

Both Brent Crude and WTI Crude were up over $40 a barrel this morning, at $40.20 and $41.54 respectively (0955GMT).

Oil prices have surged over 50 percent from their rock bottom prices since major producers have tried to convene a meeting to curb output, despite the lack of participation from Iran.

UK small business confidence drops

Britain’s small businesses have declining confidence in the face of an economic slowdown, according to a survey by the Federation of Small Businesses. Northern Irish and Scottish businesses were the most affected, showing the least confidence in the UK’s economy, with the FSB’s survey showing the first decline in job creation by small firms nationwide since mid-2013. The Small Business Index, an alternative index measuring business prospects over the coming three months, fell to 8.6 in the first quarter from 28.7 a year ago.

18/03/2016