Labour failed to win Boris Johnson’s former Uxbridge constituency last night, but scored an historic win in Selby and Ainsty, overturning a 20,137 Tory majority. The new MP in the latter constituency is just 25 years old, and will now become the House of Commons’ “baby of the house”. And yes, he shares his leader’s name. Keir Mather isn’t the only fresh-faced politico to be getting acquainted with high politics this week though. Johnson’s former assistant Ross Kempsell took up his seat in the House of Lords aged just 31. He will be a life peer with the title Baron Kempsell of Letchworth. He joins Charlotte Owen, 29, who worked briefly for Boris Johnson for no reason whatsoever…
Inflation may be slowing, but food prices are still rising at an eye-watering 17.3% a year, according to June’s CPI figures. Against this background, it is not surprising the Competition and Markets Authority (CMA) is flexing its muscles, demanding supermarkets make their pricing clearer. It has also called on the government to make necessary legislative changes if supermarkets don’t clean up their act. One particular gripe is the way supermarkets “exploit loopholes” with unit pricing. By using different units on different products, customers often miss special promotions. And then there are the genuine errors, which preclude shoppers from buying things at the correct price. The chancellor is cautiously supportive, but it remains to be seen how MPs will react – particularly as the CMA found no evidence of profiteering. After the recent furore following its decision to try to block Microsoft’s takeover of Activision Blizzard, the CMA could be seen by some to be on shaky ground. It wouldn’t want to be accused of being too heavy-handed would it?
Good News on Inflation, But is it Exceedingly Good?
Overall CPI fell from 8.7% in May to 7.9% in June, a larger drop than had been a anticipated by many economists. CPI has now fallen consistently since February, leading to the consensus view we are past the inflationary peak. However, this does not disguise the fact that many everyday items, particularly food, are still showing double digit prices rises year-on-year. But annual food price inflation could fall more sharply in the second half of the year, particularly if manufacturers follow the lead set by Premier Foods, whose brands include Mr Kipling cakes, Oxo, and Super Noodles. It says food inflation is past its peak and has pledged not to raise the price of any of its products for the rest of the year.
The Cybertruck is Here
Tesla is hoping the relaunch of its “Cybertruck” will be more successful than its initial showcase. Four years ago, Musk unveiled the futuristic-looking vehicle, which is made from the same steel alloy used in his SpaceX rockets. However, an attempt to demonstrate its robustness backfired spectacularly when a metal ball thrown at its windows caused them to shatter. This time round Musk stuck to releasing pictures of the truck being assembled in its factories, rather than inviting investors to hammer its bodywork. According to Musk the truck will feature four doors, a six-foot “bed” and will still fit into the average American’s 6 metre garage. Mass production is not expected until next year, although some analysts were not optimistic significant numbers would be rolling off production lines until 2025. Profit margins for Tesla’s electric cars are currently squeezed, causing shares to fall. It remains to be seen whether Cybertruck will reverse this trend. It now faces competition from other car manufacturers, whose electric pick-ups may look more conventional but are far cheaper.
Netflix is Winning Against The Password Sharers
Netflix’s decision to crack down on password sharing appears to have worked, with the streaming service revealing it has seen added almost 6 million new subscribers since March. The company introduced a “paid sharing” option in May, after requiring all devices using the same account to log onto the home wi-fi once a month. Although this clampdown initially caused a barrage of complaints on social media, it appears many people have paid up and created their own account, rather than lose access to the TV and film library. Will this change as Netflix jacks up its prices? It also announced it is ditching its “basic” £6.99 price tier. Subscribers can opt for its lower-cost £4.99 package, but this comes with advertisements. Those who want to continuing streaming ad-free now have to pay at least £10.99 a month. Netflix is really testing is users’ loyalty.
Investors Still Want Tax Breaks
You’d think market volatility, a cost-of-living squeeze and higher inflation would cause investors to shun markets. But this certainly isn’t true across the board. A trading update from Hargreaves Lansdown this week showed it had attracted 13,000 new customers between April and June this year. Much of this £1.7 billion of new business was from people looking to put money into ISAs and Sipps, either at the end of the last tax year or the start of this new one. It appears that times may be tough, but investors are still keen to make the most of the tax breaks available to them.
Robinhood Wants to Launch in the UK
The US share trading app that became notorious for faciliating the meme stocks craze back in 2021 looks to be launching in the UK. Robinhood Markets made headlines across the globe when its users helped drive up the price of troubled video games retailer GameStop, causing losses for hedge funds that had originally shorted the company. The platform, which offers commission-free trading, has been credited with attracting a new generation of younger investors and “democratising” finance, but also been widely criticised for encouraging novice investors to make speculative trades in higher-risk assets. It has been reported Robinhood is looking to hire a number of senior executives in the UK. The platform was founded in 2013 and listed on Nasdaq in 2021 at $38 a share, although after rising to $80 a share, it is now trading at just over $12. One wonders whether an appropriate location for Robinhood’s UK headquarters would be Nottingham. It boasts a healthy student population, a decent tram network, and, well, a certain forest…
M&S is ‘Unhappy’ With Ocado
Back in 2020 Ocado was the darling of the stock market, with a pandemic-driven valuation that put it ahead of Tesco and made it the UK’s most valuable retailer. At the time the numbers seemed somewhat spurious given Tesco controlled almost a third of the UK’s grocery market and Ocado just 1.7% (and it was not turning a profit). This week, the online grocer revealed its losses have deepened by 37% over the last year as its partnership with Marks & Spencer failed to deliver hoped-for sales boosts. The general gloom around the company wasn’t helped by the fact M&S chair Archie Norman went on record to say he was “not happy” with Ocado’s performance. M&S owns half of Ocado, following a tie-up in 2019, but poor sales could mean Ocado misses out on a final £200m payment due next year. All of this has caused Ocado share price to drop further. Shares are now priced at around £6.50, down from a high of £28.19, fuelling speculation it could become a takeover target.
There’s Evolution at Revolution
There were no tears at fashion chain Boohoo after its succeeded in ousting both the chief executive and chair at Revolution Beauty, where it is the major shareholder. Boohoo had been calling for three top executives to leave the board after the online cosmetics company ran into auditing difficulties a year after floating on the stock market. Shareholders voted the move through only for Revolution’s remaining director to reappoint them, raising serious questions about governance issues and potential regulatory action. The two side appear to have, ahem, kissed and made-up. The two senior executives are resigning properly, although Boohoo has agreed the company’s chief financial officer can remain in place.
Silly Season Has Begun
You can tell summer is upon us. This week we’ve seen stories about an alleged sighting of a lioness in woods outside Berlin, while drone shots of sharks have led the BBC’s news website. Meanwhile in California, a “rogue” sea otter has been snatching surfboards. Footage from Monterey shows the sea otter, known as 841, riding the boards she has commandeered. While this has delighted the internet and led to videos, memes and the obligatory merch (tote bags and T-shirts are available) the local US Fish and Wildlife Service has warned this “highly unusual behaviour” is potentially dangerous to both the otter and surfers. Sea otters may look cute and cuddly, but they do have some less than charming habits that don’t typically make it onto TikTok videos. Authorities are trying to capture and re-house 841, but she is embodying the rebellious spirit of California and swimming free for now. Is there a trend emerging? After fears a pack of orcas was targeting boats in the strait of Gibraltar, one wonders if we should treat our animal friends a little better.
