Morning Round Up: Petrobras hit by oil prices, Osborne faces tough deficit, travel shares lead FTSE down

Miranda Wadham
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Morning Round Up: Petrobras hit by oil prices, Osborne faces tough deficit, travel shares lead FTSE down

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
 

UK manufacturing output sinks, but demand remains high

Miranda Wadham
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UK manufacturing output sinks, but demand remains high
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 to unveil new products at event later today

Miranda Wadham
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Apple to unveil new products at event later today
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. 
21/03/2016

Morning Round-Up: Aussie stock exchange chief resigns, markets down, CBI warn on Brexit

Miranda Wadham
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Morning Round-Up: Aussie stock exchange chief resigns, markets down, CBI warn on Brexit

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

Investment Superstore launches new ISA, CFDs and Spread Betting comparison site

UK Investor Magazine
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Investment Superstore launches new ISA, CFDs and Spread Betting comparison site
Investment Superstore
A new comparative service has launched this week to provide investors with the means to make detailed investigation into which brokerage and dealing services offer the best fees. Growing competition in retail investment services has led to a great variation in the fees investors are charged and the service they receive. The Investment Superstore’s comparison tool’s main objective is to empower investors when deciding which dealing platform to use and help them decide on the best service and charging structure for them. In addition to comparison tools, the Investment Superstore has provided a range of free investment and trading calculators to assist investors who want to save money when managing their portfolio. This may be from a cost perspective, for example the ISA calculator or from helping investors understand risk management calculations or company valuation. These services are free to use for investors and the new portal promises to deliver more useful tools and calculators in the coming weeks and months. The Investment Superstore launches as the retail investment industry becomes ever fragmented. The new portal aims to bring together the various services available to UK investors and make it easy for individuals to explore the key features quickly in one place. www.investmentsuperstore.co.uk This article is sponsored by the Investment Superstore, a new educational investment portal.

BoroughBox seeks investment to scale up artisan food distribution service

Miranda Wadham
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BoroughBox seeks investment to scale up artisan food distribution service

BoroughBox, the curated distributor of artisanal produce born from Borough Market, are looking for investment to take the business to the next level.

Founded by Andrew Lawson in 2014, the company offer distribution services for award winning, specialist, artisan food and drink producers to sell their products throughout the UK. BoroughBox use a recurring subscription service, corporate sales and an online e-commerce platform to market and distribute products across the country.

Formerly a trader at the world famous foodie mecca Borough Market, Lawson was inspired to start the business after spotting an opportunity to connection regional producers with increasingly discerning foodie consumers. Over 120 merchants already use the BoroughBox platform marketplace, including Soffles Pitta Chips and Serious Pig; Lawson and BoroughBox are passionate about helping small and local artisanal food producers and foodie fans to one another.

The business has just launched a crowdfunding campaign on Crowd2Fund.com, and is aiming to raise £120,000 to invest in sales, marketing and technology, in return for a 15 percent stake in the business. BoroughBox are also offering a number of investor rewards including lifetime discounts, alongside Truffle Prosecco boxes and Pine gift hampers.

Lawson says, “Now that have laid some solid foundations for the business and proven the brand and concept works, we want to push on with aggressive growth and customer acquisition. Having smart investors for the journey makes perfect sense. The business is on trend and working with the genuine investor crowd can be great for new brand ambassadors.”

The SEIS qualifying business is planning to build multimillion pound revenues within the next three years, and to then subsequently become acquire by a larger company. Lawson added, “With the landscape rapidly changing in food itself and the way we consume, we could prick the interest of any big specialist food or subscription company, or thanks to the marketplace perhaps one of the bigger online marketplace platforms seeking a fast and direct route into the artist and specialist food sector.”

For more information, visit their campaign page here.

Morning Round-Up: IFS warning, oil hits 2016 highs, small business confidence falls

Miranda Wadham
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Morning Round-Up: IFS warning, oil hits 2016 highs, small business confidence falls

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

Bank of England unanimous on rate stick at 0.5 percent

Miranda Wadham
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Bank of England unanimous on rate stick at 0.5 percent
The Bank of England have voted to keep interest rates at their current record low of 0.5 percent. All nine members of the Monetary Policy Committee voted to freeze rates, going for the safe option as the upcoming EU referendum threatens market volatility. In a statement, the committee reasoned: “There appears to be increased uncertainty surrounding the forthcoming referendum. That uncertainty is likely to have been a significant driver of the decline in sterling. “It may also delay some spending decisions and depress growth of aggregate demand in the near term.” Governor Mark Carney neglected to give an official Bank of England position on the UK referendum. 
17/03/2016

Should I open a Lifetime ISA?

Miranda Wadham
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Should I open a Lifetime ISA?
A major announcement in Chancellor George Osborne’s 2016 budget yesterday was the introduction of a Lifetime ISA, designed to help young people save for the future. What is the Lifetime ISA? ISAs already exist in several forms, and is essentially a tax free savings allowance. However, as part of Osborne’s plan to “put the next generation first”, those under 40 in April 2017 will be able to open a Lifetime ISA, save up to £4000 a year and receive a 25 percent top up from the government. So for every £4 you save, the government will add an extra £1. Sounds good. Should I open one? Whilst it sounds like a win-win situation, there are several conditions attached. Many of these are restrictions on how the money can be spent, which are limited to buying a first home (up to £450,000), accessed from the age of 60 as a pension, or other ‘life events’, such as a terminal illness. Essentially, unless you want to save your money for a house or your pension, the Lifetime ISA isn’t for you; if you access the funds for anything else, you will not qualify for the bonus and have to pay a 5 percent fee on top. Should I use the Lifetime ISA to save for a pension? The announcement of the Lifetime ISA has raised eyebrows due to its similarity to a pension scheme, raising the question – when saving for retirement, is it better to save through a traditional employer pension scheme, or with the Lifetime ISA? Tax is paid on both a some point – money going into a Lifetime ISA is tax-paid but free to take out, and with the employer pension scheme its not-taxed going in, but tax is paid when it is taken out. It is slightly more flexible than a pension fund, but operates in a similar way. However, The Treasury is keen to stress that this account is not a pension and can run alongside other long-term savings – you can still pay into a pension and get tax relief on your contributions and benefit from the lifetime ISA bonus at the same time. What other changes were made to ISAs in the budget? From April 2017 the tax-free savings limit will rise to £20,000 a year, up from the £15,240 currently. The Help to Buy Isa scheme, which is currently in place to help first-time buyers, is due to end in November 2019. However, the new ISA scheme offers slightly more for your money. 
Miranda Wadham on 17/03/2016
 

Morning Round-Up: Oil and Asia up, Glaxo CEO Witty to step down

Miranda Wadham
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Morning Round-Up: Oil and Asia up, Glaxo CEO Witty to step down
Oil up again on positive sentiment Oil rose again on Thursday, continuing gains made on Wednesday after plans were solidified between major exporters to agree an output freeze. The world’s biggest producers – currently excluding Iran – are in support of holding a meeting to keep production at current levels – perhaps creating the first global supply deal in 15 years. Sinking oil prices and a lack of demand has caused producers to take action. Sentiment has risen on the back of this possibility, with US crude CLc1 up 77 cents at $39.23 a barrel before 0800GMT, following on from Wednesday’s gains. GlaxoSmithKline CEO Witty to step down

GlaxoSmithKline veteran CEO Andrew Witty has announced his intention to step down in 2017, after 10 years at the helm of the company.

Starting as a management trainee and remaining with the company for 32 years, felt now was the time to leave: “By next year, I will have been CEO for nearly 10 years and I believe this will be the right time for a new leader to take over”, Witty said. His departure will no doubt leave a period of uncertainty for the group, with has been hit by flagging sales and calls for the breaking up of the company into smaller units. A minority of shareholders have backed this plan, including UK fund manager Neil Woodford, but Witty has always argued that it is not something to consider in the short term. Last month, GSK saw sales rise 2 percent to £6.29 billion for the three months to December, but disclosed a pre-tax loss of £416 million. Shares in the group rose at open this morning, but have since fallen to -0.28 percent at 1408.00 (0927GMT). Asian shares up Asian shares had a strong day on Thursday, with most indexes closing positive after an increase in investor sentiment and the falling of the dollar. MSCI’s broadest index of Asia-Pacific shares outside Japan .MIAPJ0000PUS climbed to a two-month high and was last up 1.9 percent. The Hang Seng was up 1.21 percent, the Shanghai Composite up 1.20 percent and South Korea’s Kospi rose 0.9 percent.   
17/03/2016
 
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