Chinese retail giant Alibaba make record ‘Singles Day’ sales
Online Chinese retail giant Alibaba Group (NYSE:BABA) have announced impressive sales so far during China’s biggest shopping day, with more than $1 billion being spent within an hour of midnight.
November 11th is ‘Singles Day’ in China, originally a day mocking Valentine’s Day for those not in relationships, in which stores offer huge discounts in a similar manner to America’s Cyber Monday. Alibaba Group have said that so far the value of merchandise it has sold online so far had surpassed last year’s total of $9.3 billion – and it is just past 4pm local time.
As speculation grows as to the health of China’s economy, Alibaba’s sales data has been closely watched as a gauge of Chinese consumption. These strong figures will come as a relief to those worried about growth in the world’s largest economy.
Retail sales slow for October, with prospect of ‘Black Friday’ looming
British retail sales fell unexpectedly in October, possibly due to shoppers waiting for ‘Black Friday’ discounts at the end of November, according to new figures from the British Retail Consortium.
Retail sales were down overall by 0.2 percent in October compared with the same month last year, a sharp drop from the 2.6 percent rise seen in September.
The BRC’s chief executive Helen Dickinson commented:
“October was a somewhat disappointing month overall for retailers.
“A number of categories which we would typically expect to be popular on Black Friday saw a slowdown in October, suggesting that some shoppers may be holding out in the hope of some great deals at the end of November.”
The BRC also highlighted the fact that Halloween fell on a Saturday this year, meaning fewer people were likely to have gone shopping – and the impact of Britain adopting America’s annual ‘Black Friday’ sales day means shoppers may be waiting until then to spend.
Rugby World Cup boosts ITV’s performance
Rugby World Cup sales have been strongly beneficial to national television broadcaster ITV (LON:ITV), who have reported a 13% rise in revenues for the nine months to the end of September.
Strong advertising revenue have pushed up their results, with total revenues at £2 billion, up £0.6 billion on a year earlier. ITV have also raised their revenue forecast to 5 percent higher for the full year.
ITV chief executive Adam Crozier said in a statement: “We’re on track for another year of double digit profit growth as we continue to strengthen ITV in the UK and internationally. “As we expected, share of viewing has improved in the second half driven by strong performances in daytime, the soaps and the Rugby World Cup, and continuing this trend remains a key focus for the business.” ITV are currently trading up 0.82 percent at 258.80 pence per share (1108GMT).David Cameron sets out demands for EU reform
Prime Minister David Cameron has laid out his plans for EU reforms, arguing that the European Union needs to play a lesser role in the day-to-day functioning of its member states, ahead of the membership referendum in 2017.
The Prime Minister is due to state his aims in a letter to the president of the European Council, which will include four main objectives. These will be the protection of the single market for Britain and other non-euro countries, a boost in competitiveness, exemption for Britain from an “ever-closer union” and restrictions upon EU migrants’ access to in-work benefits.
In his speech, Cameron said:
“Never forget that the European Union now comprises 28 ancient nations of Europe. That very diversity is Europe’s greatest strength. Britain says: let’s celebrate that fact, let’s acknowledge that the answer to every problem is not always more Europe. Sometimes it’s less Europe.”
David Cameron has committed to forming a better deal for the UK but remain in Europe, however admits that if that cannot be achieved, he may be in favour of leaving the EU altogether.
Arguably, Cameron’s aims for reform of the EU may be nothing but a fantasy; in particular, the restriction of access to benefits for EU migrants, as certain basic rules governing this area are enshrined in EU law and are part and parcel of being in the EU. However, whilst Cameron admits his mission is ‘big’, he says it is not impossible – the truth of this remains to be seen.
Economic growth downgraded by the CBI
The Confederation of British Industries has downgraded its growth forecasts for the UK economy for 2015 and 2016, as the uncertainty of a US rate hike takes its toll.
It now expects GDP to grow by 2.4% in 2015, down from a previous forecast of 2.6 percent. This lack of economic growth will come as bad news for chancellor George Osborne, who is due to make a speech later today announcing a further 30 percent budget cut. However, despite the downgrade, the forecasts remain slightly above average for the British economy. CBI director-general John Cridland said in a statement: “Manufacturers are enduring tougher conditions as a persistently strong pound is hamstringing our export competitiveness. But our domestic story is strong and overall we are now in a phase of stable but solid economic growth.” He called for “solid foundations” to support the economy, including a final decision on expanding airport capacity.Asian shares mixed on US jobs data
Asian shares were mixed on Monday, as a reaction to US jobs data released at the end of last week.
Data showed that the US added 271,000 jobs in October, its highest figure for nearly a year. Unemployment also fell to 5 percent, the lowest since before the financial crisis.
Asian markets had a mixed reaction to the figures; Tokyo’s Nikkei rose 2 percent and the Shanghai Composite was up 1.6 percent, but the Australian S&P/ASX 200 index was down 1.83 percent.
The jobs data caused the dollar to bounce to a 7 month high, knocking commodity prices lower. Brent crude fell 0.8 percent to $47.81.
The markets were also affected by Chinese trade data released on Sunday, showing that the region still had more to do to stimulate domestic demand. Markets globally have been affected by uncertainty over a US rate hike, after Federal Reserve Chair Janey Yellen hinted last week that it was likely to come before the close of the year. Investors are now worrying that higher borrowing costs in the United States could hurt an already shaky global economy.
George Osborne to announce 30 percent budget cut later today
Chancellor George Osborne will announce a 30 percent cut to Britain’s day-to-day budget this afternoon, despite widespread opposition to further austerity measures.
Osborne is expected to say in a speech later that he will cut the budgets of the Treasury, Transport, Local Government and Environment by 8 percent each, as part of his overall 37 billion-pound austerity plan to turn Britain’s deficit into a surplus by 2020.
However, Paul Johnson, director of the Institute for Fiscal Studies, told the BBC that it will be “less tough than it looks. Across government he’s looking for cuts in day-to-day spending of between 25% and 30%, so really huge cuts for those unprotected departments.”
Osborne has consistently been unapologetic about his measures to curb the deficit. Extracts of his speech show that he will say:
“If our country doesn’t bring the deficit down, the deficit could bring our country down. That’s why, for the economic security of every family in Britain, the worst thing we could do now as a country is lose our nerve.”
Britain currently has one of the highest budget deficits amongst the advanced economies, at 4.9 percent of GDP in 2015. Osborne aims to cut this to 3.7 percent this year.
Recent economic figures look positive; on Friday, statistics showed that UK economic growth had risen 0.6 percent in the three months to October, and manufacturing growth grew to a one and a half year high in September.
British manufacturing output rises at fastest pace for six months
British manufacturing output rose in September and the country’s goods trade deficit narrowed, according to data from the Office for National Statistics.
Manufacturing output is rising at its fastest pace since April 2014, surging to 0.8 percent in September – double the pace of August.
Results for British manufacturing and trade have been poor over the past couple of years, but the fast increase is a good indication of economic recovery.
A strong strengthening of the pound and difficulties with Greece have hit manufacturers hard this year. However, according to figures released today, the trade goods deficit narrowed to £9.351 billion in September; a sign that the industry may start to find it easier.
AstraZeneca wins $2.7 billion bid for ZS Pharma
UK pharmaceutical company AstraZeneca (LON:AZN) have agreed to buy ZS Pharma for $2.7 billion in cash, after months of negotiations.
ZS Pharma holders will get $90 per share, a premium of 42 percent on yesterday’s close. The deal is based on AstraZeneca acquiring medicines from ZS Pharma to boost its sales as their own big sellers near the end of their patent protection.
AstraZeneca’s Chief Executive Pascal Soriot said in a statement:
“This acquisition complements our strategic focus on Cardiovascular and Metabolic Disease by adding a potential best-in-class treatment to our portfolio of innovative medicines.”
Rival Swiss firm Actelion also made a bid for ZS Pharma, but were pipped at the post during the last days of bidding.
AstraZeneca are currently trading down 0.73 percent on the news. (0931GMT)
Ontario follows US in legislating towards crowdfunding
Support for equity crowdfunding as an alternative means of business finance is growing in Canada, with Ontario becoming the latest province to pass changes allowing the public to invest in small businesses through crowdfunding.
The Ontario Securities Commission’s new rules will allow businesses to offer equity stakes through registered crowdfunding platforms, including those operating online.
In total, six Canadian provinces now allow equity crowdfunding including British Columbia, Quebec and Nova Scotia. The new laws will come into force on January 28th, 2016.
Websites like Kickstarter, Indiegogo and Patreon already operate in Canada, but investors cannot receive an interest in the business.
The new rules will also make using crowdfunding less complicated for businesses, allowing them to issue an 11-point disclosure document about their business rather than a 38-point prospectus detailing every aspect of the company. This move should make crowdfunding more appealing and attainable for both businesses and investors. Like in the UK, crowdfunding platforms will still be required to run background checks and other due diligence on companies and investors.
OSC chairwoman Monica Kowal said in a statement:
“It’s specifically geared toward helping small- and medium-sized enterprises … leverage the Internet and social media to connect with investors who have an appetite to invest in startups and other companies that are hungry for capital.”
Last Friday, the U.S. Securities and Exchange Commission (SEC) changed their rules to allow companies to offer securities through crowdfunding, deregulating the sector to a model similar to that in the UK. UK-based crowdfunding platform Seedrs has already announced plans to expand into the US on this news.
Prior to this many individual states passed legislation regulating crowdfunding however the impact of this was limited as funding could not be found across state lines.
With the US and Canada getting on board with crowdfunding, there is no doubt that the sector continue to expand as a viable source of business finance.
Miranda Wadham on 06/11/2015