market

BUSINESS LIVE: Natwest cuts ex-CEO's pay package; GDP growth flatlines; Diageo suffers demand dip


LIVE

The British economy stalled in the third quarter, registering flat gross domestic product growth between July and September, and surpassing expectations of a 0.1 per cent dip, fresh data from the Office for National Statistics shows. 

The FTSE 100 is down 0.9 per cent in early trading. Among the companies with reports and trading updates today are Diageo, Redrow, Chemring and Warpaint. Read the Friday 10 November Business Live blog below.

> If you are using our app or a third-party site click here to read Business Live

UK’s first supermarket to go back to fully-staffed checkouts

A supermarket chain dubbed the ‘northern Waitrose‘ has become the first in the UK to go back to fully-staffed checkouts after axing almost all of its self-service tills.

Booths believe that the personal touch from the manned checkouts gives their customers a better experience – and the ‘warm northern welcome’ is a key part of their charm.

Breaking: Natwest to dock ex-CEO’s payout package

Natest will now pay almost £7.6million in potential payments to former boss Dame Alison Rose, who left the comapny in July in the fallout of the Nigel Farage ‘debanking’ row.

The bank said this morning;

‘Following the announcement that Ms Rose stepped down from her role by mutual agreement, it has been confirmed that good leaver status is not applicable under the relevant share plan rules.

‘There is no change to the vesting schedule of her awards; any awards due to vest after her cessation of employment on 26 July 2024 will lapse. The current value of the unvested share awards that will lapse is £4,711,491.* No finding of misconduct has been made against Ms Rose by NatWest Group.

‘In addition, no bonus or variable remuneration will be paid to Ms Rose in respect of service during 2023. Had Ms Rose remained in role as Group Chief Executive for all of 2023 then under the approved DRP her maximum variable pay opportunity would have been £2,868,113, subject to satisfaction of relevant performance conditions.’

Readers Also Like:  Recession Could Solve the UK's Inflation, Says Hunt

THIS founder on why fake meat is having its craft beer moment

Britain’s love affair with fake meat was more of a fleeting romance, as consumers turned their back on it as quickly as they fell for it.

It’s claimed the vegan market may be worth as much as £50billion globally by 2030, but sales in the UK seemed to have flatlined.

UK GDP surprise complicates Bank of England’s plans

Robert Alster, CIO at Close Brothers Asset Management:

‘Today’s GDP figures will come as a surprise, showing the economy flatlined in the third quarter, avoiding a contraction. This may complicate the Bank of England’s path, with less of a basis to delay further rate hikes and even consider rate cuts.

‘It will reinforce the Bank’s hawkish tone from last week’s meeting, and Andrew Bailey will probably continue to dampen talk of cuts, sticking to the message that interest rates need to remain elevated for quite some time.

‘However, despite the more positive numbers, the Bank still has flexibility. With grocery inflation in the UK dipping below double digits, the upcoming inflation data on the 15th November will be key to demonstrating how much further the Bank of England has to go, and the possibility of rate cuts next year.

‘It’s a relatively dramatic turnaround over a relatively short period of time.’

ING: UK recession ‘can’t be ruled out’

‘UK GDP was a little better than expected, but in reality, the economy has largely stagnated this year.

‘We expect that trend to continue over coming quarters as the impact of higher rates continue to bite, though a recession can’t be ruled out.’

Greenpeace hit with Shell lawsuit after 13 day oil rig protest

Shell is suing Greenpeace for £1.7million after its protesters occupied an oil rig for 13 days.

The oil giant said it supports the right to peaceful protest but the ‘unlawful and extremely dangerous’ action put the lives of both the protesters and crew at risk.

Home REIT forced to sell more properties as it scrambles to raise cash

Struggling Home REIT has once again sold off a chunk of its portfolio for a fraction of its purchase price as it scrambles to raise cash.

The homeless housing firm –which has been under scrutiny since November last year following a report by short-seller Viceroy Research – announced it had sold another 153 properties at a series of auctions earlier this week, raising around £23.4million.

Readers Also Like:  L&T revises share buyback price higher to Rs 3,200 from Rs 3,000

When will we see an end to car and home insurance price hikes?

Households are struggling under the weight of rising car and home insurance premiums – and no sign of when prices are likely to fall again.

Federal Reserve chairman Jerome Powell warns inflation fight is not over

Redrow sales slump

Redrow expects annual profit and revenue to be at the lower end of its forecast range as the builder suffers a subdued autumn housing market.

The latest warning from a UK housebuilder on challenging conditions in the housing market comes as elevated mortgage costs and broader economic worries drive homebuyers away.

Earlier this week, Redrow’s bigger peers Taylor Wimpey and Persimmon flagged uncertainty in the coming months.

The business has had to adapt to a ‘more difficult trading environment’ in terms of build rate and operating costs, Redrow Chairman Richard Akers said.

In September, the company had forecast fiscal year 2024 profit before tax of £180million to £200million, and revenue of £1.65billion to £1.7billion.

GDP growth flatlines in Q3: ‘A decent outcome’

Emma Mogford, manager of the Premier Miton Monthly Income Fund:

‘A flat economy isn’t usually something to cheer about. However, given the pressures from the cost-of-living crisis and higher interest rates, it’s a decent outcome.

‘While pressures from higher rates remain, I think we can go into the festive season with a dash of optimism about the British economy.’

Diageo suffers demand dip

Diageo expects organic operating profit growth to decline in the first half of its current financial year due to ‘materially weaker’ performance in Latin America and Caribbean.

‘Macroeconomic pressures in the region are resulting in lower consumption and consumer downtrading,’ the world’s biggest spirits company said in a statement.

‘These impacts are slowing down progress in reducing channel inventory to appropriate levels for the current environment.’

Latin America and Caribbean makes up nearly 11 per cent of the Johnnie Walker maker’s net sales.

Sales in the region are now expected to decline by more than 20 per cent, year-on-year, in the first half of fiscal 2024, the company added.

Arm tumbles as British chipmaker’s first set of results since US float come up short

GDP growth flatlines: ‘The bigger issue lies with the service industry’

Michael Field, Europe market strategist at Morningstar:

Readers Also Like:  Largest Equity Fund Outflows Since Truss Era

‘UK GDP growth came in at 0.2% in September, against economists’ expectations of a flat performance. This comes on the foot of August’s reading of 0.1% growth. While this level of growth is far from robust, the important thing here is that the UK economy is in the black, and flat growth quarter on quarter means that the UK will not enter a technical recession in 2023.

‘Manufacturing usually takes the rap for slow economic growth in the UK, and rightfully too in many ways. Manufacturing activity, shown by manufacturing PMIs, has been in decline since the middle of 2022. With manufacturing contributing less than 20% to GDP however, this is just part of the problem.

‘The bigger issue lies with the service industry, which contributes almost 80% of GDP, and accounts for almost the same percentage in employment. Here, a large pullback in spending over the last 18 months by both businesses and consumers has hurt the economy. The somewhat bright news however is that service output rose by 0.2% in September, following a 0.7% fall in August.

‘With interest rates at the highest level since the global financial crisis, the cost of interest on debt is really starting to bite for both businesses and households. With interest rates likely to stay high for an extended period of time, it is hard to see any quick reversal on service spending, meaning low GDP growth may persist for some time yet.’

GDP growth flatlines in Q3

The British economy stalled in the third quarter, registering flat gross domestic product growth between July and September, and surpassing expectations of a 0.1 per cent dip, fresh data from the Office for National Statistics shows.





READ SOURCE

This website uses cookies. By continuing to use this site, you accept our use of cookies.