Ah, public tenders – the mysterious world where companies large and small compete for lucrative contracts offered by the UK government.

It can seem intimidating if you’re new to this arena, but fear not! We’re here to demystify the process, debunk common myths, and highlight the benefits of participating in bidding on UK public tenders. So, grab a cuppa, sit back, and let’s dive in!

The Current State of Public Tendering in the UK

Public tendering is alive and kicking in the UK, with the government spending billions of pounds on goods, works, and services each year. This means businesses have plenty of opportunities to secure a slice of this massive financial pie.

Key Benefits of Participating in UK Public Tenders

If you’re still on the fence about diving into the world of public tenders, consider these advantages:

Boost your revenue: With billions of pounds up for grabs, securing a government contract can significantly increase your company’s income.

Enhance your reputation: Winning a public tender can elevate your company’s status and credibility in the eyes of potential clients.

Gain valuable experience: Participating in the tendering process helps you refine your proposal-writing skills and learn the ins and outs of competing for contracts.

Expand your network: Working with government agencies can lead to long-lasting relationships and future business opportunities.

Now that we’ve covered the benefits let’s tackle those pesky myths.

Common Myths Surrounding UK Public Tenders

Myth #1: Only big businesses need to apply

Think you’re too small to compete? Think again! The UK government is committed to supporting small and medium-sized enterprises (SMEs). As industry expert Jane Smith once said, “Size doesn’t matter in public tendering – it’s all about showcasing your company’s unique strengths and capabilities.”

Myth #2: The tendering process is too complex and time-consuming

While the tendering process can be intricate, with the right approach and preparation, it’s entirely manageable. Plus, there are plenty of resources available to help you navigate the process, like the Mystery Solved: A Guide to Public Tenders in the UK eBook.

Myth #3: You need insider connections to win a contract

Contrary to popular belief, the tendering process is designed to be transparent and fair. The UK government adheres to strict regulations to ensure that contracts are awarded based on merit, not nepotism. So, even if your cousin’s best friend’s uncle works for the Ministry of Defence, it won’t give you an unfair advantage.

Real-World Examples: Success Stories from UK Public Tenders

To illustrate the potential of public tenders, let’s look at some real-world examples:

Company A: This small IT firm secured a multi-million-pound contract to upgrade the government’s outdated computer systems. The company’s innovative approach and cost-effective solution helped them beat out larger competitors.

Company B: A family-run catering business won a lucrative contract to provide school meals for a local authority, helping them expand their operations and create new jobs in the community.

Join the Public Tender Revolution!

So, are you ready to take the plunge into the world of UK public tenders? We hope this light-hearted guide has provided you with valuable insights and dispelled any lingering doubts.

Read more:
Debunking Myths and Discovering the Benefits of UK Public Tenders

Move over Google, TikTok is the world’s new most popular online destination.

The viral video app gets more hits than the American search engine, according to Cloudflare, an IT security company.

The rankings show that TikTok knocked Google off the top spot in February, March and June this year, and has held the number one position since August.

Last year Google was first, and a number of sites including TikTok, Amazon, Apple, Facebook, Microsoft and Netflix were all in the top 10.

Cloudfare said it tracks data using its tool Cloudflare Radar, which monitors web traffic.

It is believed one of the reasons for the surge in Tiktok’s popularity is because of the Covid pandemic, as lockdowns meant people were stuck at home and looking for entertainment.

By July this year, TikTok had been downloaded more than three billion times, according to data company Sensor Tower.

The social network, which is owned by a Chinese company called Bytedance, now has more than one billion active users across the world, and that number continues to grow.

In China, to comply with the country’s censorship rules, the app is called Douyin, and runs on a different network.

Douyin was originally released in September 2016. This year, China ruled that users under the age of 14 would be limited to 40 minutes a day on the platform.

Security concerns

TikTok was launched internationally in 2018, after merging with another Chinese social media service, Musical.ly, an app which allowed users to share videos of themselves lip-synching to songs.

The social media platform is no stranger to controversy. In 2019, it garnered a temporary ban in India, a US counter-intelligence investigation and a record £4.3m fine after Musical.ly was found to have knowingly hosted content published by under-age users.

As one of the only internationally successful Chinese apps, politicians and regulators outside China have raised concerns about security and privacy.

Last year TikTok was forced to deny it is controlled by the Chinese government.

Theo Bertram, TikTok’s head of public policy for Europe, the Middle East and Africa, said it would refuse any request from China to hand over data.

The app hosts a variety of short videos, covering genres such as comedy, dance and politics. The competition on TikTok has become so tense that it made getting noticed on the app harder by the day. Some businesses and individuals are even using these services to grow their Tiktok accounts.

In the UK, the most popular creator is make-up artist @abbyroberts with 17.4 million followers.

This year @Francis.Bourgeois, with 1.6 million followers, quit his job to become a full-time trainspotter as a result of his viral videos at railway stations talking about trains and cheering them as they pass.

Expanding

Food and recipe videos have become a key part of TikTok’s success, with viral clips getting millions of views.

As a result, in the US, a new food delivery service called TikTok Kitchen will launch in March, allowing people to order dishes originally created in viral videos.

The menu will be based on the app’s most viral food trends and will include courses like the baked feta pasta which was ranked the most searched dish of 2021 by Google.

TikTok Kitchen is being co-founded by Robert Earl, who owns the US food outlets Planet Hollywood, Buca di Beppo and Bertucci’s.

He said about 300 TikTok restaurants are planned across the country for the launch, with more than 1,000 expected by the end of 2022.

TikTok Kitchen will operate out of many of the restaurants belonging to the chains owned by Mr Earl.

Read more:
TikTok ousts Google to become favourite online destination

The COVID-19 impact on global supply chains has meant that UK businesses could be forgiven for taking their eyes off the rapidly approaching hardball that is Brexit. Come January 2021, they’ll no longer have that option.

You can ignore Brexit, but you can’t ignore the consequences of ignoring Brexit.

And despite the UK government’s bluff and bluster, many businesses will be negatively affected simply by sheer weight of extra paperwork. Lord Agnew, one of the ministers responsible for Brexit preparedness said UK businesses still had their heads in the sand.

Who could blame them? The logistical landscape of the post-Brexit UK looks grim and they’ve had other, more pressing worries to contend with.

But the reality remains. UK customs processes are going to become trickier. And they weren’t in great shape to start with.

“UK customs clearance processes are already outdated, slow and opaque. Many consumers don’t actually realise that a significant portion of customs entries are processed by manual data entry” laments Sam Tyagi, founder and CEO of digital customs clearance platform, KlearNow.

Tyagi’s concerns come at a time when supply chain inefficiencies are in the spotlight; as well as Brexit, the recently approved Pfizer/BioNTech vaccine is another topic to have sharpened consumer awareness of how goods get into and out of the UK.

“While other essential supply chain processes have adapted and modernised, customs clearance has been slow to keep up. ‘Yesterday’s technology, tomorrow’ appears to be the motto.

“Brexit will compound this problem and make it harder and more expensive to clear goods at UK borders” warns Tyagi.

51-year-old Tyagi is originally from India and based in Santa Clara, California – at the heart of Silicon Valley – but for the past few years his mind has been firmly focused on less glamorous places like Dover, Felixstowe and Southampton and, more specifically, the customs processes currently in operation there.

KlearNow, founded in 2018, is the world’s first AI-driven, 100% digital customs clearance platform. Its mission is clear; to make global logistics simple and cost-effective.

As a customs clearance and document management platform built for importers, exporters, customs agents, brokers, freight forwarders and hauliers, KlearNow’s January 2021 launch could not have been timed better.

It’s already proving popular in the United States and Canada, but in those territories it’s very much seen as a business process improvement solution; a path to efficiency and cost reduction.

In a post-Brexit UK, it could be an absolute lifeline for businesses who import and export and for overworked logistics workers.

As well its California HQ and site in Toronto, KlearNow has locations in Manchester, Madrid, and Rotterdam. It’s people are well placed geographically to understand the nuances and intricacies of post-Brexit trade.

In May 2020, the company raised $16 million in series A funding. On reporting the funding raise, tech website Techcrunch noted, in the context of COVID-19, the timeliness of a platform that gives workers in the import/export ecosystem access and visibility of the customs process without having to go into their office to print off reams of declarations and manually enter data. It can be done from anywhere, and more efficiently.

The need for remote access and work-from-home capabilities is the global commerce standard. Yet today’s customs clearance processes are still predominantly manual. The results are error-prone, leading to increased importer costs and supply chain delays.

When thinking about Brexit, this is obviously bad for UK businesses. When thinking about things like health, it’s potentially catastrophic.

“With the announcement that the UK has become the first country to approve the Pfizer/BioNTech vaccine and that it plans to have it ready for use next week, it’s understandable that many are now asking if this is actually feasible and how Brexit will affect the UK’s ability to rapidly import essential goods such as medicines in the near future’ explains Tyagi.

“The logistics industry as a whole has been urging the UK government to modernise and digitise its import processes to mitigate the inevitable delays caused by the UK’s exit from the European Union.”

It’s abundantly clear to Tyagi from his vantage point in California, and it’s abundantly clear to a significant slice of the UK business community, that whatever deal UK negotiators do or do not strike with their EU counterparts, the existing, inefficient customs processes are going to cause pain and cost money.

A solution that smoothes out that friction while providing visibility and opportunities for manpower and cost reduction would be welcome at any time. But given the many contours and sharp edges of doing global business after January 1st 2021, platforms like KlearNow will become an essential part of the exporter’s toolkit.

Read more:
Customs Crunch – How this startup plans to take the friction out of brexit

During the first quarter of 2020, global stocks plummeted as a result of Covid-19, with indexes such as the Dow Jones plunging to record lows on March 9th, March 12th and March 16th.

However, the equity market has shown its inherent resilience during Q2, with world shares recently rallying to their highest level since February and even the Euro hitting its strongest peak in 18 months last week.

These trends have largely been driven by the EU’s recently announced stimulus package, which followed five days of tense negotiation and agreed a defined plan of action to revive regional economies that have been ravaged by coronavirus. Not only is this a highly symbolic development, but it also offers renewed confidence for seasoned investors.

What’s Included in the Package?

There’s no doubt that stocks and the single currency have endured a volatile few days of late, with the continued threat posed by coronavirus being compounded by uncertainty over the potential stimulus package.

Ultimately, the EU’s member states agreed to an unprecedented €750 billion (£680.2 billion) stimulus package, with this representing the single most incredible act of solidarity in almost seven decades of European integration.

The package will be split into two relatively equal segments, including €390 billion in grants and a further €360 billion in low-interest loans.

These funds will also be disbursed gradually, with 70% allocated for 2021 and the remaining 30% set to be distributed in 2023 depending on the extent of the EU’s economic decline post-coronavirus.

On a similar note, the EU has also announced plans to dedicate a quarter of its budget to tackling climate change and invest an estimated $1.1 trillion into creating a greener economy. This is also great news for investors, as it increases the level of positive economic sentiment and encourages higher capital inflows across the globe.

How has the Market Reacted?

In addition to driving growth in European and global stocks, the single currency has also made gains since the stimulus package was announced.

The EUR/USD is performing particularly well at present, with Edward Moya from Oanda commenting that the greenback continues to get beat up as the EU recovery fund agreements drives a broad rally for typically risky (as opposed to relative safe haven) assets.

Of course, the trend is being compounded by the cautious approach of the Fed and the sustained impact of Covid-19 in the US, with the dollar also in freefall against commodity currencies across the globe.

On a similar note, crude prices have also started to surge after the deal was announced publicly, while the suggestion that the rate of Covid-19 infections in various US states may be about to peak and has also seen an increase in global oil demand.

Oil is tentatively breaking out of its narrow trading range, despite the lack of a strong catalyst for WTI crude to break above the coveted $45 level.

According to the most recent figures, WTI Crude peaked at $41.26 a barrel towards the end of last week, while Brent Crude rose to $43.75 a barrel while showcasing growth of 0.32%.

This trend is likely to continue indefinitely, which is good news for investors and commodity currencies as a whole.

Read more:
EU stimulus package announced offers new confidence for investors

TSB is expected to pile more misery on its customers, who were hit by a serious IT failure yesterday, when it announces as many as 100 branch closures next week, almost a fifth of its network.

The Times is reporting that the bank is expected to take the axe to its 540-strong branch network and announce hundreds of job losses.

Debbie Crosbie, who became chief executive six months ago, is trying to reduce costs and demonstrate her grip on the accident-prone business.

Regulators began an investigation into the bank after it was hit by an IT failure that led to 135,000 customers finding that wages and other payments failed to reach their accounts yesterday morning.

The setback came three days after the bank’s board was severely criticised by an independent report into an IT crash last year that locked almost two million TSB customers out of their accounts.

Customers criticised TSB on Twitter, while the bank apologised and said that no account-holder would be left out of pocket because of the failing.

“What an absolute joke @TSB is, I wake up expecting my wages to be in my bank and there’s nothing there,” one customer tweeted. Another said: “What a shambolic company, need to switch banks I think.”

TSB said yesterday: “Overnight some payments were delayed in and out of TSB accounts. This has now been resolved and the payments to and from customers have all been completed.”

It declined to comment on the branch closures or job cuts.

TSB was carved out of Lloyds Banking Group and briefly floated before being bought by Sabadell, the Spanish banking group. It has 3.8 milllion current account-holders and 7,800 employees. Sabadell wants to sell it.

The lossmaking TSB has been trimming its branch network, earmarking 14 for closure this year. However, analysts expect a much larger cull on Monday as it adjusts to a world where many customers do most of their banking on smartphones and pay by swiping debit and credit cards.

John Cronin, a banking analyst with Goodbody, the stockbroker, said that he expected TSB to announce 100 branch closures, with associated staff redundancies of between 400 and 500. He thought there would be a “material further reduction of staff beyond that”.

Cutting branches is likely to be awkward for TSB, which until recently was promoting itself as a bank deeply embedded in communities. Its slogan was “Local banking for Britain”.

Last year’s IT failure left customers unable to access their money for weeks and led to a surge in fraud attacks, forcing out Paul Pester, the chief executive. The Financial Conduct Authority, which is investigating last year’s crash, is investigating the latest failure.

A Slaughter and May report into the earlier IT fiasco, when a systems upgrade went badly wrong, criticised the board for lacking “common sense”.

TSB, which has put the cost of last year’s failure at £366 million, could face a heavy fine. Royal Bank of Scotland was fined £56 million for a systems crash in 2012, which left 6.5 million RBS, Natwest and Ulster Bank customers unable to access their accounts.

Read more:
Struggling TSB set to close 100 branches and axe staff

Top-flight shares in London were the standout performers in Europe on Tuesday as investors snapped up oil and tobacco stocks.

The FTSE 100 index climbed 86.83 points, or 1.29%, to 6,833.93.

“Defensives were the order of the day as investors sought the relative safety of tobacco stocks and utilities, amid US–Sino trade tensions and ahead of the Brexit vote in the Commons,” said Fiona Cincotta, senior market analyst at City Index.

Leading the best-performing stocks was British American Tobacco, up 135p to 2,510p, while Imperial Brands gained 50p to close at 2,411.5p.

A resilient climb in oil prices helped push the FTSE higher after the US slapped sanctions on Venezuela’s state-owned oil firm. The move has raised the prospect that the country’s crude exports could be curbed.

A barrel of Brent Crude oil was trading 2.3% higher at 61.46 US dollars.

David Madden, market analyst at CMC Markets UK, said: “The British equity benchmark has lagged behind its continental counterparts lately, and the stability in the commodity space helped it outperform today.”

The pound spiked in the afternoon as traders saw a smaller possibility of a no-deal Brexit, but the currency was heading southwards as the evening parliamentary vote approached, slipping 0.11% against the euro to 1.498 and dropping 0.13% to 1.314 US dollars.

Elsewhere on the European markets, the French Cac was 0.81% higher and the German Dax inched 0.08% higher.

Even the FTSE 250 was up despite a string of downbeat updates from companies including PZ Cussons, Domino’s and Royal Mail.

Imperial Leather owner PZ Cussons issued a profit warning amid mounting woes in its Nigerian business.

Shares dropped 31p to 178.6p after the group said underlying pre-tax profits are expected to be “towards” £70 million, down from £80.1 million a year earlier.

Domino’s Pizza said it will report full-year profits at the lower end of expectations following “growing pains” in its international business, particularly Norway.

The company expects full-year underlying pre-tax profit to be at the lower end of the consensus range of £93.9 million to £98.2 million, following weaker international sales and business integration challenges in Norway.

Shares in the group were down 23.8p to 250.1p.

Royal Mail delivered more gloom as it warned of a worse-than-expected fall in addressed letter mailings, as business uncertainty takes its toll.

Its share price dropped 39.9p to 260.8p.

Veterinary chain CVS Group saw more than a third wiped off its stock market value after warning over profits amid a shortage of vets and trading troubles in the Netherlands.

Shares in the group – which has more than 500 vet practices across the UK, Netherlands and Ireland – crashed 251.5p, or 38.54%, to 401p after it said underlying earnings for the year to the end of June are set to be “materially” lower than expected.

The biggest risers on the FTSE 100 were British American Tobacco up 135p to 2,510p, DS Smith up 15.5p to 334.4p, Rio Tinto up 133p to 4,077.5p, and IAG up 18.4p to 641.4p.

The biggest fallers were Hargreaves Lansdown down 112.5p to 1,684.5p, Tui down 25p to 1,169.5p, easyJet down 15.5p to 1,277.5p, and CRH down 21p to 2,198p.

Read more:
FTSE 100 outperforms European counterparts as oil and tobacco stocks gain

The pound and the markets ended Monday in a gloomy mood as traders remained nervous over geopolitical developments.

Sterling fell 0.53% to 1.151 euros and was 0.29% lower against the dollar at 1.316 as optimism waned ahead of a series of Brexit votes in the House of Commons on Tuesday.

“After a few relatively calm days, Brexit is back centre stage ahead of a second parliamentary vote Tuesday,” said Fiona Cincotta, senior market analyst at City Index.

“Although the PM will argue her best to the contrary, nothing much seems to have changed in the content of her Brexit proposal or in the political mood over the last few days other than calls to postpone the March 29 deadline.”

Meanwhile the FTSE 100 sank into the red, shedding 62.12 points, or 0.91%, to close at 6,747.1.

David Madden, market analyst at CMC Markets UK, attributed the jitters to international trade fears.

“Stocks are lower this afternoon as investors continue to be worried about the state of US-China trade relations,” he said.

“The two sides will sit down to discuss trade later this week, and seeing as the sentiment has been less than optimistic recently, dealers are a little on the nervous side.”

In France the Cac was 0.76% lower while the German Dax fell 0.63%.

Oil prices were also weaker, dropping after industrial earnings data from both the US and China prompted fears of a global slowdown.

A barrel of Brent crude oil was trading 2.9% lower at 59.66 US dollars.

In London, City analysts greeted news that Tesco will make changes impacting as many as 9,000 jobs as “a long time in the making”.

Bruno Monteyne, an analyst at Bernstein and former supply chain director for Tesco Asia, said the changes did not necessarily suggest a recent downturn in performance.

“The market is obviously tough but we think this language is as much about reminding staff and unions why Tesco had to embark on this four-year restructuring programme rather than indicating that things got worse recently.”

Shares in the grocer were down 3.9p to 221p at the close.

Meanwhile Ocado closed 19.6p higher at 966p, leading the blue-chip index, on the back of reports that it is in talks about a possible partnership with Marks & Spencer.

News that the companies are in talks to launch a £1 billion food delivery service was welcomed by investors.

It was reported that M&S would buy the Waitrose part of the Ocado business, including distribution centres and vans, when the existing contract ends next year.

M&S shares also rose during the day but were broadly flat at the close, rising 0.3p to 290.3p.

Shares in energy consultancy Utilitywise plummeted after it said it had put itself up for sale and needs to raise £10 million in equity.

The share price plunged by more than 4p, or 71.38%, to just 1.16p.

The biggest risers on the FTSE 100 were Ocado up 19.6p to 966p, Rio Tinto up 66.5p to 3,944.5p, Carnival up 61p to 4,162p and Land Securities up 9.6p to 863.2p.

The biggest fallers on the FTSE 100 were NMC Health down 106p to 2,560p, ITV down 3.65p to 128.35p, Lloyds Banking Group down 1.57p to 57p and Barclays down 4.02p to 160.08p.

Read more:
Pound sinks ahead of second Brexit parliamentary vote

Shares in Ocado have been boosted by reports that the online grocer is in talks with Marks & Spencer to launch a £1 billion food delivery service.

The stock gained as much as 6.7%, surpassing 1,000p in early trading on Monday.

Meanwhile, M&S hit a high of 297.6p, up 2.6%.

It came on the back of reports that M&S would buy the Waitrose part of the Ocado business, including distribution centres and vans, when the existing contract ends next year.

According to the Mail on Sunday, top executives have held discussions over the past few weeks regarding the proposal.

Russ Mould, investment director at AJ Bell, said the deal would have positive potential outcomes for both parties.

“Such a move would be another tick in the box for Ocado, which is adding relationships with supermarkets in several parts of the world. Its core focus is now selling technology expertise to the food retail sector rather than running physical delivery operations,” he said.

“For Marks & Spencer, having a stronger delivery network would give it a new way in which to try and boost earnings. There is no guarantee this would be the magic solution to fix its declining profits but it would put the business on a more level pegging with some of its key competitors.”

But Bruno Monteyne, analyst at Bernstein, said it seemed “unlikely” that M&S would be a replacement for Waitrose given the latter’s buying volumes on branded products.

“M&S price points are also materially higher than the Waitrose private label ranges,” he added.

But he said M&S could help to fill capacity at Ocado’s Erith fulfillment centre or could even be a launch partner for the technology business’s Amazon Prime Now-style immediacy-grocery concept.

Read more:
Ocado shares rise on reports of Marks & Spencer deal

The pound strengthened on Friday as investors grew confident that Britain will avoid leaving the European Union without a trade deal.

Sterling was up 0.72% against the US dollar at 1.315 but fell 0.15% versus the euro to 1.153 at the London market close.

The British currency moved higher against the greenback for a fifth straight session, putting it on track for a 1.8% gain across the weak.

Fiona Cincotta, senior market analyst at City Index, said: “Demand for sterling remains elevated as the market becomes more convinced that the UK will avoid crashing out of the EU without a deal.

“Whilst Chancellor Hammond and business leaders mounted pressure on Theresa May to remove the hard Brexit option from the table, the DUP (Democratic Unionist party) also reportedly pledged support to Theresa May’s Brexit Plan B, if there is a clear time limit attached to the Irish backstop.”

She added that pound investors seem “happy to ignore the fact that Brussels are so far not agreeing to a time limit”.

Investors will be looking ahead to another crunch vote in Parliament on Tuesday for Mrs May’s Plan B Brexit deal.

Ms Cincotta doubts whether Mrs May will be able push her deal through as Plan B seems similar to Plan A.

Meanwhile trading on the FTSE 100 was relatively muted due to the stronger pound with the index having closed 9.73 points, or 0.14%, lower at 6,809.22.

Germany’s DAX rose 1.37% and France’s CAC was up 1.14%.

Ms Cincotta said “weak results from Vodafone acted as a drag on the FTSE and miners and oil majors were offering their support”.

Telecoms giant Vodafone reported a drop in quarterly revenue but remained firm on its growth expectations for the full year.

Group revenue was 11 billion euro (£9.52 billion) in the third quarter, down by 0.8 billion euro, with the company blaming the decline on new accounting standards, foreign exchange headwinds and the sale of its Qatar business.

Shares in Vodafone closed down 7.04p to 137p.

In other corporate news, Fuller’s is to sell its entire beer business to the European arm of Japanese brewer Asahi.

In a deal which values the division at £250 million, the London-based brewer is to sell the production and distribution of its well-known beers including flagship drink London Pride.

Shares in Fuller’s jumped more than 20% following the announcement and closed up 141p to 1,050p.

Elsewhere, Irn-Bru maker AG Barr expects to report higher profit, shrugging off the new sugar tax, but warned that it expects continued uncertainty due to Brexit and further regulatory intervention.

The Scottish soft drinks company expects profit to be ahead of the previous year and in line with expectations, while revenue is to be 5% higher to about £277 million for the year ending January 26.

AG Barr shares fell 36p to 762p.

The competition watchdog ordered pest control and hygiene giant Rentokil Initial to sell several large supply contracts in order to quell concerns about its merger with rival Cannon Hygiene.

Following a probe, the Competition and Markets Authority (CMA) said the tie-up would result in “higher prices or a worse service for customers”.

Rentokil shares rose 0.3p to 333.8p.

Brent crude, the international benchmark, traded up 0.47% at 61.42 US dollars (£46.67).

The biggest risers on the FTSE 100 were Fresnillo up 54.8p to 946.8p, Anglo American up 72.6p to 1,865p, Smurfit Kappa up 82p to 2,192p, and Antofagasta up 29.4p to 827.2p.

The biggest fallers on the FTSE 100 were Vodafone down 7.04p to 137p, Intercontinental Hotels Group down 126p to 4,257.5p, GVC down 19p to 652.5p, and Hiscox down 39p to 1,470p.

Read more:
Sterling rallies on hope UK can avoid no-deal Brexit

Irn-Bru maker AG Barr expects to report higher profit, shrugging off the new sugar tax, but warned that it expects continued uncertainty due to Brexit and further regulatory intervention.

The Scottish soft drinks company expects to post full-year profit ahead of the previous year and in line with expectations.

Revenue is expected to be around £277 million for the year ending January 26, up about 5% from the £264.1 million of a year earlier.

AG Barr, which also makes Rubicon and Tizer, said the impact of the sugar levy “has been evident across the UK soft drinks market with value growth significantly outstripping volume in the period”, but it expects to return to a “more value-led trading strategy” this year.

The firm revamped Irn-Bru and other drinks ranges to reduce the sugar content ahead of the launch of the new UK soft drinks sugar tax last April.

The group stopped making the original full-sugar version last January – but the move prompted a backlash among loyal Irn-Bru fans.

The company also warned that “further regulatory intervention is on the horizon” for the soft drinks industry and that “consumer dynamics continue to evolve”.

It also flagged that “current political and economic uncertainty in the UK looks set to continue”.

Sophie Lund-Yates, equity analyst at Hargreaves Lansdown, said sugar tax-related price hikes mean volume growth has been slow for the soft drinks industry, but that AG Barr bucked the trend.

“The group’s been able to keep prices largely flat, since its new recipe was below the sugar cap, and that means AG Barr’s been able to boost the amount it’s selling – we think that’s been a good move and will help margins in the long run.

“With wider uncertainties lingering though, there’s no telling how much of a headache Brexit will be.

“Added to that, it’s very likely we’ll see more regulatory clampdowns in the medium term, and that’ll mean another round of shake-ups for the industry,” she said.

AG Barr expects to complete its £30 million share purchase programme during this year, which is slightly later than it previously indicated, but the company maintained that it has a tight control on costs and a robust balance sheet.

Full-year results are expected to be announced on March 26.

Read more:
AG Barr to shrug off sugar tax hit with increase in profit

The FTSE 100 struggled for direction on Thursday as markets digested news from the European Central Bank and comments made by US commerce secretary Wilbur Ross.

London’s premier index shed 23.93 points, or 0.35%, to end the day on 6,618.95.

David Madden, analyst at CMC Markets, said that traders were held back by mixed news from the continent and stateside.

“The European Central Bank maintained their monetary policy, meeting expectations. Mario Draghi, the head of the ECB issued a statement that was on the dovish side.

“The central banker cautioned about risks to the downside, and said that stimulus is needed to sustain inflation.

“Wilbur Ross, US secretary of commerce issued a mixed statement in relation to Chinese trade.

“Mr Ross claimed the two sides were ‘miles and miles’ away from ending the trade dispute, but he also said there is a fair chance that China will get a trade deal.”

In stocks, shares in British Airways owner IAG nudged up after the airline ended its interest in low-cost carrier Norwegian, adding it will sell its remaining stake in the firm.

Last year, IAG took a 4.61% stake in Norwegian, bought with the intention of launching a full bid.

But on Thursday, the firm said that it does not intend to make an offer for Norwegian and will sell its stake in the company.

IAG shares closed up 2p to 633p.

Barclays shares closed down as the bank’s chief executive revealed that activist investor Edward Bramson, one of the lender’s largest shareholders, has not laid out his strategy.

Mr Bramson, through his investment vehicle Sherborne, has built a 5.5% stake in Barclays and is ramping up pressure on the lender to curtail its investment arm.

Barclays boss Jes Staley said he had a “reasonable engagement” with Mr Bramson, but he is yet to reveal his plans for the lender.

Shares closed down 0.2p down at 162.66p.

Shares in Fever-Tree fizzed up after the drinks firm reported another year of rapid growth, with consumers snapping up its mixers during the heatwave and the busy Christmas period.

In a trading update, the group said full-year revenue for 2018 was around £236 million, an increase of 39%.

The group’s board expects full-year results to be comfortably ahead of its expectations.

Shares in the company rocketed 350p to 2,948p.

The pound held on to gains made in recent days, trading at 1.306 versus the US dollar, a decrease of 0.2%. Against the euro, sterling was flat at 1.149.

In Europe, Germany’s DAX was up 0.47% while France’s CAC 40 was up 0.59%.

A barrel of Brent Crude was changing hands for 60.8 US dollars, an increase of 0.1%.

The biggest risers on the FTSE 100 were Centrica up 3.25p at 134.4p, St James’s Place up 20.6p at 962p, Evraz up 8.1p at 463.6p and Ashtead up 29p at 1,899p.

The biggest fallers on the FTSE 100 were Vodafone down 5.22p at 144.04p, Reckitt Benckiser down 191p at 5,593p, British American Tobacco down 57p at 2,425p and EasyJet down 25.5p at 1,254.5p.

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FTSE 100 ends day in negative territory

The FTSE 100 was under pressure on Tuesday as investors continued to fret about global growth, while the stronger pound added to the sell-off.

London’s blue-chip index closed 69.20 points, or 0.99%, lower at 6,901.39, while Germany’s DAX fell 0.48% and France’s CAC declined 0.55%.

David Madden, market analyst at CMC Markets, said: “Stocks are in the red as the concerns about China’s economy are still doing the rounds.

“The fear of a global slowdown is playing on traders’ minds and the major equity benchmarks in Europe are lower this afternoon.”

He added that the “geopolitical situation isn’t looking too hot at the moment and traders are nervous”.

Elsewhere the pound rose on strong UK wages data and hopes of a second referendum to halt the political deadlock over Brexit.

Sterling was up 0.49% against the US dollar at 1.295 and was up 0.56% versus the euro to 1.140 at the London market close.

Data showed that wage growth had moved up to its highest level since the financial crisis, which Fiona Cincotta, senior market analyst at City Index, said was “all the more impressive given the current Brexit uncertainties”.

Meanwhile, Labour leader Jeremy Corbyn tabled a motion that would give Parliament the right to vote on whether to give the public a final say on Britain’s departure from the European Union.

Ms Cincotta said: “Pound traders are sensing that the Brexit mood continues to shift away from a no-deal scenario.

“A cliff-edge Brexit would be the most damaging to UK business, the economy and therefore the pound.

“The more other options, such as a delay of Article 50 or second referendum are explored, the more beneficial for the pound.”

In corporate news, easyJet said last month’s drone disruption at Gatwick was a “wake-up call” to airports after it cost the airline £15 million and affected 82,000 customers.

The low-cost carrier also said revenues in the three months to December 31 increased 13.7% to £1.3 billion, while passenger revenues rose 12.2% to £1.03 billion.

Shares in easyJet closed up 73p to 1,234.5p.

Haydn Mursell, the chief executive of troubled Kier Group, is to leave the business with immediate effect.

The construction giant said the board has asked chairman Philip Cox to act in an executive capacity alongside the finance and operating chiefs – Bev Dew and Claudio Veritiero – to oversee operations until a new boss is appointed.

Kier shares were up 4p to 527.5p.

Pets at Home is to spend up to £8 million stockpiling pet food and products as it becomes the latest business to step up plans for a hard Brexit.

In a trading update for the third quarter, the retailer said that, as Brexit looms, it is looking at increasing its inventory holding.

Pets at Homes shares increased 21.7p to 147.2p.

Brent crude, the international benchmark, traded down 3% at 60.75 US dollars (£46.90).

The biggest risers on the FTSE 100 were easyJet up 73p to 1,234.5p, Ocado up 29.4p to 915p, Kingfisher up 4.4p to 222.1p, and Fresnillo up 16.4p to 912.2p.

The biggest fallers on the FTSE 100 were Wood Group down 22.4p to 524.8p, Evraz down 16.2p to 447.6p, GVC down 21.5p to 689.5p, and Royal Dutch Shell down 68.5p to 2,334.5p.

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FTSE 100 trades lower on global growth concerns

The FTSE 100 pared losses on Thursday thanks to the weak pound while global indexes declined as previous investor optimism around US-China trade relations cooled.

London’s blue-chip index closed 36.24 points, or 0.52%, higher at 6,942.87 – while Germany’s DAX rose 0.11% but France’s CAC fell 0.37%.

Fiona Cincotta, senior market analyst at City Index, said: “Global equities ended a four-day rally on Thursday as reality set in over what was actually achieved in the US-China trade talks, and as the US government shutdown rattles on.

“The FTSE was faring better than its European counterparts paring losses, thanks in part to the Brexit-weakened pound.”

She said the pound traded lower against the US dollar as uncertainty around Britain’s departure from the European Union continues “to dominate amid the airing of the Brexit agreement in Parliament. This combined with signs of an economic slowdown as retailers failed to increase their sales this Christmas from a year earlier has put the bears firmly in control”.

Sterling was down 0.15% against the greenback at 1.276 and was up 0.09% versus the euro at 1.108 at the London market close.

Retail news dominated the day, with a host of firms posting festive trading figures.

John Lewis’s 83,000 staff woke up to news that their annual bonus is under threat for the first time since 1953 as the retailer said it expects profits to be “substantially lower” this year amid slower sales growth.

Over Christmas, like-for-like sales grew just 1%, while sister chain Waitrose saw only 0.3% growth.

Marks & Spencer sales were also under pressure, with the performance of both clothing and food wilting.

Over its Christmas quarter, the bellwether said like-for-like clothing and home sales dropped 2.4% over the 13 weeks to December 29 while comparable food sales fell 2.1%.

Struggling department store chain Debenhams recorded a 3.4% decline in like-for-like sales in the six weeks to January 5, weighed down by the UK, where sales were 3.6% lower due to weaker footfall.

In brighter news, Tesco unveiled its best set of Christmas trading figures in nearly a decade, with the UK’s biggest retailer lauding promotions on festive staples including vegetables and meat.

The grocery giant posted a 2.2% rise in UK like-for-like sales in the six weeks to January 5.

Halfords, meanwhile, issued a profit warning after mild weather and weak consumer confidence hit sales.

Card Factory has also warned that underlying profits for the 2020 financial year are likely to be flat, as it braces for another “difficult” trading period.

Shares in Marks & Spencer closed down 3.2p to 274.5p, Debenhams down 0.83p to 4.8p, Tesco up 4.6p to 216.4p, Halfords down 61.8p to 216.8p, and Card Factory down 26.6p to 168p.

Elsewhere, car giant Jaguar Land Rover is to cut 4,500 jobs under plans to make £2.5 billion of cost savings.

Most of the cuts are expected to be in the UK, with a voluntary programme being launched.

Brent crude, the international benchmark, fell 0.05% at 61.29 US dollars.

The biggest risers on the FTSE 100 were Fresnillo up 28.2p to 949.6p, SSE up 28p to 1,152, Tesco up 4.6p to 216.4p, and Intertek up 106p to 5,060p.

The biggest fallers on the FTSE 100 were Burberry down 48p to 1,742p, Paddy Power Betfair down 150p to 6,590p, NMC Health down 52p to 2,930p, and Next down 66p to 4,787p.

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FTSE 100 pares losses as pound weakens on Brexit woes

The FTSE 100 followed global stock markets higher on Wednesday, buoyed by the conclusion of trade talks between the US and China.

London’s premier index ended the day up 45.03 points, or 0.66%, at 6,906.63.

It came after the two economic superpowers reportedly ended talks on a positive note, giving investors reason to cheer.

David Madden, market analyst at CMC, said: “Stocks are pushing higher into the close after US-China trade talks ended on an optimistic note.

“Traders are aware that some structural issues still persist, and that more issues need to be resolved, but the overall mood is positive.”

In stocks, Taylor Wimpey was the biggest riser in the top flight after the housebuilder brushed aside Brexit uncertainty and said it was seeing “solid” signs for the year ahead.

In a trading update, it reported a 3% rise in house sales to 14,947 during 2018.

Taylor added that average prices on private sales lifted 2% to £301,000 and said it ended the year with an order book worth £1.8 billion, up from £1.6 billion a year earlier.

Shares closed up 8.7p at 149.1p.

Sainsbury’s was the latest retailer to report on Christmas trading, blaming “cautious” consumer spending for falling sales as its Argos business also suffered after cutting back on heavy discounts.

The supermarket giant – which plans to merge with rival Asda in a £12 billion deal – saw like-for-like retail sales fall 1.1% in the 15 weeks to January 5.

While grocery sales rose 0.4% over the quarter, this was offset by a 2.3% drop in general merchandise and a 0.2% decline for clothing.

Shares closed up 6.1p at 272.6p.

Ted Baker shares were on the rampage as investors breathed a sigh of relief that consumers appear to be unmoved by allegations against its founder.

The fashion brand said retail sales increased by 12.2% over the five weeks to January 5.

E-commerce sales, which account for about a quarter of retail performance, were up 18.7%.

Shares spiked 504p, or 31.19%, to end the day at 2,120p.

It comes amid an ongoing investigation into the conduct of Ted Baker’s founder and suspended boss Ray Kelvin, who was accused of harassment in the workplace last year.

The company said an independent investigation, led by law firm Herbert Smith Freehills, is “progressing” and a further update will be given in due course.

Sterling was up 0.4% versus the US dollar at 1.276 as the pound was boosted by more embarrassment for Theresa May’s Government, which lost another key Brexit vote.

It means Parliament has more control of Britain’s fate, and Mrs May and extreme Brexiteers will be forced to bow to its sovereignty.

Against the euro, the pound was down 0.5% at 1.107.

In Europe, Germany’s DAX was up 0.8% and France’s CAC gained 0.95%.

A barrel of Brent crude was trading at 61 US dollars, a rise of more than 4% on the back of lower inventories.

The biggest risers on the FTSE were Taylor Wimpey up 8.7p at 149.1p, ITV up 6.45p at 137.58p, Wood Group up 25.8p at 592.8p and Micro Focus up 63p at 1,499p.

The biggest fallers on the FTSE 100 were Royal Bank of Scotland down 4.9p at 220.9p, Vodafone down 2.8p at 152.8p, Hikma down 28p at 1,571.5p and Hargreaves Lansdown down 24.5p at 1,884.5p.

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FTSE 100 ends in positive territory as US-China trade talks end

Norwegian energy firm DNO has moved one step closer to taking over Faroe Petroleum after gaining a majority stake in the group.

The group said on Wednesday that it owns or has acceptances for 52.4% of the North Sea oil producer’s shares after upping its bid for the firm to £641.7 million a day earlier.

DNO increased its offer from £608 million, or 152p per share, which has been continuously rejected by Faroe’s board.

The new figure represents a price of 160p per Faroe share.

DNO’s offer will become unconditional on January 11.

The takeover saga has seen Faroe describe DNO’s advances as “opportunistic”, arguing it substantially undervalues the company.

Last week, Faroe hired industry experts at Gaffney, Cline & Associates to come up with their own valuation of the company, which concluded that its assets are valued in the range of 186p to 225p per share, or between 879 million US dollars (£688 million) and 1.1 billion US dollars (£862 million).

But Faroe’s board said on Wednesday that it now recommends shareholders accept the offer, although it reiterated that it does not believe it represents “fair value”.

“The board considers that, following its initial investment in Faroe and in the conduct of its subsequent offer, DNO has created considerable uncertainty for minority shareholders,” the firm added

“The board also notes that DNO has indicated that it expects to make changes to the Faroe board and the board therefore considers there to be no assurance that Faroe would continue to maintain its current corporate governance culture in line with UK corporate governance best practice.”

Faroe’s directors will now work with DNO to ensure an orderly transition of control.

Under the terms of its offer, DNO said that £53 million of the proceeds will be payable to Faroe directors, management and employees, while the remainder will go to shareholders other than itself.

The group said its final offer price represents a 27.2% premium to Faroe’s share price of 125.8p on November 23, the day before the pursuit was made public.

Read more:
Predator DNO inches closer to Faroe takeover

The FTSE 100 managed to start the new year on the front foot on Wednesday, ending in positive territory after being weighed down early on by disappointing economic data from China.

London’s top flight ended the day up 6.1 points, or 0.09%, at 6,734.23.

However, it spent most of the day in the red as investors were spooked by a further slowdown in the world’s second largest economy.

David Madden, analyst at CMC Markets, said: “The FTSE 100 has a relatively large exposure to commodity companies, so the worry that China is cooling has hit mining and energy stocks hard.

“China is a major importer of minerals and oil, and dealers are wary their appetite for commodities will fall further.”

Data out overnight showed the Caixin survey of Chinese manufacturing fell to 49.7, its first contraction since May 2017. A reading above 50 indicates growth, a reading below, contraction.

It comes amid simmering trade tensions between the US and China, adding to negative sentiment about the global economy.

Miners bore the brunt of the pain early in the day, with the likes of Anglo American and Glencore among the biggest fallers, shedding 37.4p to 1,710.4p and 8.85p to 282.5p by the close respectively.

But a late surge in oil prices saw Royal Dutch Shell and BP shares benefit, helping drag the FTSE 100 into calmer waters.

Also lending a helping hand were retailers following decent figures from John Lewis.

A surge in shoppers looking for last-minute gifts helped lift sales at department store chain over the festive period with sales up 4.5% in the week to December 29.

The retailer said it was boosted by shoppers buying last-minute Christmas presents, adding it experienced “very strong sales on Christmas Eve and a confident start to clearance sales both online and in shops”.

A bellwether for the sector, it helped catapult Next to the top of the FTSE 100. Shares in the clothing chain, which reports to the market on Thursday, ended the day up 186p, or 4.66%, at 4,177p.

Ocado was also up 20.6p to 810.6p by the close.

The pound, meanwhile, came under more selling pressure as Brexit fears once again came to the fore.

Sterling was down 1.2% versus the US dollar at 1.258. Against the euro it dropped 0.4% to 1.108.

It came as fresh data showed that British manufacturers are stockpiling goods at near record rates in preparation for a calamitous no-deal EU exit.

The Markit/CIPS UK manufacturing purchasing managers’ index (PMI) showed a reading of 54.2 last month, higher than the 53.6 recorded in November, and a six-month high.

But rather than being cause to celebrate, IHS Markit said the numbers reflect a build up of “safety stocks to mitigate potential Brexit disruption”.

In Europe, Germany’s DAX rose 0.18% while France’s CAC40 was down 0.8%.

A barrel of Brent crude was trading at 55 US dollars in a volatile session that saw it rebound from 52.5 US dollars amid oversupply fears.

The biggest risers on the FTSE 100 were Next up 186p at 4,177p, Fresnillo up 28p at 888p, Paddy Power Betfair up 180p at 6,580p and Wood Group up 13.4p at 519.6p.

The biggest fallers on the FTSE 100 were Glencore down 8.85p at 282.5p, Johnson Matthey down 76p at 2,723p, Informa down 16p at 614.2p and Rolls Royce down 20.6p at 809.4p.

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FTSE 100 closes up after late rebound

The FTSE 100 edged lower on Thursday as the Fed inspired sell-off in the US dragged London’s blue-chip index into the red.

Global stocks fell on Wednesday and continued into Thursday after the US Federal Reserve raised interest rates and indicated that it will tighten monetary policy despite an increasingly gloomy economic outlook.

The FTSE 100 closed down 54.01 points, or 0.8%, at 6,711.93.

CMC Market’s David Madden said: “European equity markets are in the red but they are off the lows of the session. The tightening of monetary policy, and the projection of further tightening to come from the Federal Reserve yesterday, has hurt investor sentiment.

“The US central [bank] hiked rates by 0.25% – meeting forecasts, and they cautioned about lower growth and inflation, while at the same time suggesting two more hikes are in the pipeline for 2019. Traders are worried the US central [bank] will press ahead with monetary tightening plans against a softer economic backdrop.”

Elsewhere, the Bank of England’s monetary policy committee voted unanimously to hold interest rates at 0.75% as it warned that Brexit uncertainty had “intensified considerably” in the past month.

Fiona Cincotta, senior market analyst at City Index, said: “The Bank (or anybody else) has no idea whether the UK will leave the EU with a deal or in a disorderly fashion. Given the elevated levels of uncertainty, the central bank didn’t give indication as to how recent data was shaping monetary policy.”

The pound, meanwhile, was higher on strong UK retail sales data and US dollar weakness.

Sterling was up 0.28% against the US dollar at 1.264 and flat versus the euro to 1.107 at the London market close.

In corporate news, troubled gas and electricity supplier Yu Group sparked another hefty share price drop after it warned over a further profit hit following “serious” accounting failures.

The group, which alerted in October over a £10 million knock to profits after unearthing accounting irregularities, said it now expects an extra impact of between £2.75 million and £3.25 million following the results of an independent probe.

Yu shares closed down 10.5p at 68p.

Kier Group said nearly two-thirds of its investors snubbed a rights issue aimed at raising £250 million, leaving a syndicate of banks nursing a £100 million headache.

The construction giant had proposed to offer 64.5 million new shares at 409p each, but on Thursday Kier said it had received just 37.7% of acceptances.

Kier shares fell 6.2p to 391.2p.

Bus and rail giant Stagecoach agreed to sell its under-pressure US business in a deal valuing the division at 271.4 million US dollars (£214.4 million).

It comes just weeks after Stagecoach first revealed talks to sell the North American arm after an £85.4 million writedown in the division sent the group tumbling to a half-year loss.

Stagecoach shares were down 2.6p to 135.2p.

Germany’s DAX was down 1.44% and France’s CAC 40 declined 1.72%.

A barrel of Brent crude, the international benchmark, was trading down 2.2% at 55.44 US dollars (£43.85).

The biggest risers on the FTSE 100 were Smurfit Kappa up 74p to 2,088p, Severn Trent up 53p to 1,873p, National Grid up 18.6p to 796p, and Fresnillo up 15p to 845p.

The biggest fallers on the FTSE 100 were Carnival down 471p to 3,877p, Scottish Mortgage Investment Trust down 18.45p to 459.15p, Antofagasta down 29p to 757p, and Micro Focus International down 50.5p to 1,355p.

Read more:
FTSE 100 lower on Fed inspired sell-off

Fantasy miniatures maker Games Workshop has pencilled in a healthy rise in first-half sales and profit as it hailed the performance of a key product.

The Nottingham-based firm said trading has continued in line with expectations in the six months to December 2, with sales set to come in 13% higher at £124 million.

Operating profit is set to nudge up from £38.8 million to £41 million.

The results were helped by the continued popularity of tabletop game Warhammer, which Games Workshop said is in “great shape”.

“We have built on the progress we made last year and the results are considerable given the backdrop of major projects, increasing factory capacity and enterprise resource planning system implementation,” the firm said.

Shares in Games Workshop came under pressure in October after the company warned over uncertain trading.

The FTSE 250-listed wargaming manufacturer said at the time that there are “some uncertainties in the trading periods ahead for the rest of the 2018/19 financial year”.

On Friday, shares rose 5% to 3,155p in early trade.

In June, staff at Games Workshop were handed a £5 million bonus following a year of solid sales and profits.

Games Workshop makes 75% of its revenues overseas, so has benefited from the Brexit-induced collapse in the pound.

Read more:
Fantasy firm Games Workshop trading in line

A stock market bloodbath saw £56 billion wiped off the FTSE 100 on Thursday as fears that the arrest of a senior Huawei official in Canada could reignite tension between the US and China.

London’s blue-chip index closed 217.79 points, or 3.2% lower, at 6,704.05. France’s Cac was down 3.3% while Germany’s Dax fell 3.5%.

Huawei’s chief financial officer, Meng Wanzhou, faces possible extradition to the United States after her arrest on suspicion of trying to evade sanctions against Iran.

A Chinese government statement said Meng broke no US or Canadian laws and demanded Canada “immediately correct the mistake” and release her.

David Madden, market analyst at CMC Markets, said: “Equity markets suffered severe losses as investors are worried the relationship between the US and China has been strained by the arrest.

“The US-China relationship was moving in the right direction after the G20 summit, and now dealers feel all the good work could be undone. It is a broad-based sell-off that we are seeing in London, as mining, energy, financial and consumer stocks are all lower.”

Sterling was trading relatively flat against both the US dollar and euro at 1.277 and 1.123 respectively as Brexit fears kept the British currency shackled.

Brent crude was trading down 2.8% at 59.77 US dollars a barrel despite Opec countries agreeing to cut oil production.

Crude has been falling since October as countries such as the US and Saudi Arabia produce at higher rates, and due to fears that weaker economic growth will dampen energy demand.

Mr Madden said: “The cartel will give further details on the size of the cut tomorrow, but traders are sceptical it won’t be enough to prop up the price. Going into the meeting, there was talk of a 1.4 million-barrel cut, and it was reported that Saudi Arabia are keen for a cut of only 1 million barrels.

“The energy information administration report showed that US oil stockpiles by 7.32 million barrels, while traders were only expecting a drop of 942,000 barrels.”

In corporate news, Ted Baker has reported a dip in third-quarter sales and confirmed that Herbert Smith Freehills will conduct a probe into harassment allegations levelled at chief executive Ray Kelvin.

The under-fire retailer said the law firm will carry out an “independent external investigation” after a petition emerged calling on the fashion brand to “end harassment”, accusing Mr Kelvin of enforcing a “hugging” culture.

Ted Baker shares closed 44p, or 3%, higher at 1,511p.

Insurance firm Beazley has warned that it will take a 40 million US dollar (£31.4 million) hit from claims linked to wildfires in California.

More than 50,000 people in the West Coast state were forced to flee wind-driven flames in November that burned 240 square miles.

Beazley shares fell 25p, or 4.6%, to 517.5p.

Meanwhile, Royal Bank of Scotland (RBS) is to shift £13 billion worth of business to the Netherlands if the UK crashes out of the European Union with no deal.

About 30% of the customers for its investment banking unit, NatWest Markets, will move to the lender’s new Dutch subsidiary as well as existing transactions by March 4 in the event of a disorderly Brexit.

RBS shares declined 10p, or 4.5%, to 212p.

The biggest risers on the FTSE 100 were Randgold Resources were up 174p to 6,556p, Fresnillo up 8.4p to 783p, and Severn Trent up 1p to 1,853.5p.

The biggest fallers on the FTSE 100 were Antofagasta down 57.80p to 760p, Prudential down 94.50p to 1,410p, Schroders down 152p to 2,357p, and Melrose Industries down 9.85p to 156.5p.

Read more:
£56bn wiped from FTSE 100 over China-US fears following Huawei arrest

The FTSE 100 surged on Monday as traders kicked off December by celebrating a ceasefire in the US-China trade war.

London’s top flight added 82.17 points, or 1.18%, to close at 7,062.41 as miners led the charge.

Michael Hewson, analyst at CMC Markets UK, said: “European markets have had a decent start to the month, after an escalation to the US China trade dispute was deferred well into next year.

“Some have suggested that it is premature to get too carried away and in some respects that is correct, but for the here and now, and in the absence of anything else it is still a positive outcome, and could drive some strong gains in the weeks ahead.”

Antofagasta and Evraz were two of the day’s biggest winners, rising 62.8p to 863.2p and 34.7p to 488.8p respectively.

At the bottom of the index was GlaxoSmithKline, which was involved in two deals on Monday.

First, the drugs maker sold Horlicks and a clutch of other health drink brands in India to Unilever for 3.3 billion euros (£2.94 billion).

Later in the day, GSK announced it is to acquire oncology-focused US pharma business Tesaro for 5.1 billion US dollars (£4 billion).

Shares closed down 123.6p at 1.498p.

On the FTSE 250, shares in travel firm Thomas Cook continued their slide as investors fret over its long-term prospects.

The company’s stock shed another 6.46p, or 24.46%, to close at 23.64p.

Traders appeared to be reacting to a note issued by Berenberg, which said Thomas Cook must raise £400 million to deal with its debt, cut its target price to 12p from 65p and cut its rating to sell from hold.

Last week, the group unveiled a loss after tax of £163 million, compared with a profit of £9 million this time last year.

McColl’s shares tanked after the convenience store operator warned over profits as it was stung by the collapse Palmer & Harvey.

The group said in a trading update that the failure of the supplier resulted in “significant supply chain disruption”, and that it is “continuing to experience a number of challenges”.

As a result, McColl’s now expects adjusted earnings for the full year to come in at around £35 million, down from a previous forecast of £44 million.

Investors sent shares tumbling nearly 30%, or 35.35p, to 83.4p.

The pound, meanwhile, came under selling pressure as Brexit once again took its toll.

Sterling shed 0.3% versus the US dollar to sit at 1.274 at the London market close.

Against the euro, the pound was also down 0.3% at 1.122.

Mr Hewson added: “The pound has come under pressure, despite economic data that continues to show a UK economy that is outperforming the rest of Europe. Political concerns are once again acting as an anchor on sentiment as scepticism over whether Theresa May’s Brexit deal will get passed through Parliament next week.”

In Europe, Germany’s DAX closed up 1.85% and France’s CAC was 1% higher.

A barrel of Brent crude was trading at 60 US dollars, a rise of 2.6%.

The biggest risers on the FTSE 100 were Antofagasta up 62.8p at 863.2p, Evraz up 34.7p at 488.8p, Anglo American up 109.2p at 1,675.4p and Wood Group up 39.4p at 674.4p.

The biggest fallers on the FTSE 100 were GlaxoSmithKline down 123.6p at 1,498p, Kingfisher down 7p at 243p, BT Group down 5.4p at 256.6p and Royal Mail down 4.4p at 315.4p.

Read more:
FTSE 100 surges as trade war fears buoy investors

The FTSE 100 ended in the red on Friday as housebuilders and mining stocks weighed on the index.

London’s blue chip market suffered a fall of 58.71 points, or 0.83%, to close at 6,980.24, with Antofagasta, Fresnillo and Anglo American all ending in negative territory.

Fiona Cincotta, senior market analyst at City Index, said: “The heavy weighted miners were taking a beating after manufacturing data from China overnight highlighted the growing impact of the US trade war.

“Chinese manufacturing activity dropped to the lowest level in 2 years with a PMI of just 50, whereby 50 separate contraction from expansion.

“High tariffs that have been applied to both US and Chinese goods are starting to be reflected in economic data, as the G20 summit begins.”

Housebuilders were also under pressure following Nationwide’s latest index.

It showed house price growth picked up in November from a previous five-year low, but the market remains “subdued”, the building society concluded.

Property values increased by 0.3% month on month, compared with 0% growth in October.

The annual rate of house price growth also strengthened, to 1.9% in November, from 1.6% in October, which had been the weakest annual increase seen in more than five years.

Taylor Wimpey shed 4.55p to end at 134p, Barratt Developments close down 10.5p at 462.2p, Berkeley Group lost 80p to end at 3,226p and Persimmon dropped 65.5p to 1,900p.

FTSE 250 listed Kier Group also took a hammering after the firm announced that it will tap investors for £264 million as storm clouds gather over the construction sector.

The firm said that the proceeds of the rights issue will go towards reducing debt and it is also aimed at strengthening the balance sheet.

Explaining its rationale for the move, Kier said it believes that risks associated with its net debt position have recently increased.

Shares tumbled over 32%, or 244.5p, following the announcement to 508p.

The pound also came under pressure, with Brexit once again guiding the hand of currency traders.

Sterling dropped 0.2% versus the US dollar at 1.276.

David Madden, analyst at CMC Markets, said: “GBP/USD is lower on account of the firmer US and uncertainty surround Brexit.

“There is little support for Theresa May’s deal, some MP’s are fearful of a ‘no-deal’ Brexit and now, Donald Tusk, the President of the European Council said its ‘no deal or no Brexit’. The pressure is mounting on Mrs May, and the pound.”

Against the euro, the British currency was up 0.5% at 1.127.

In Europe, Germany’s DAX was down 0.36% while France’s CAC 40 lost 0.1%.

A barrel of Brent Crude was trading 1% lower at 59 US dollars.

The biggest risers on the FTSE 100 were GlaxoSmithKline up 24p at 1,621.6p, Centrica up 1.6p at 137.75p, Shire up 45p at 4,550p and Vodafone up 1.18p at 168.94p.

The biggest fallers on the FTSE 100 were NMC Health down 244p at 3,298p, Tui down 79p at 1,117p, Antofagasta down 36p at 800.4p and Melrose Industries down 7.8p at 176.6p.

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Shares end day in negative territory as housebuilders and miners punished

The FTSE 100 ended in positive territory on Thursday, buoyed by mining and commodities stocks.

London’s top flight closed the day up 34.43 points, or 0.49%, at 7,038.95, with the likes of Antofagasta, Anglo American and Fresnillo leading the charge.

A strong performance from Wall Street overnight also helped boost the index, as well as a bounce back in oil prices.

Fiona Cincotta, a senior market analyst at City Index, said: “Following a Fed inspired rally on Wall Street, the FTSE jumped higher on the open and retained its gains across the session.

“Whilst banks initially traded higher following a comfortable pass in the most recent stress test, commodity stocks did most the heavy lifting as they traced base metals and oil prices higher.”

Brent crude was trading over 2.5% higher at 60 US dollars a barrel following a sharp sell off earlier in the week.

A weaker pound, flagging under the weight of yet more Brexit malaise, also offered support to the FTSE 100.

Sterling was down 0.3% versus the US dollar at 1.278 and the British currency shed 0.4% against the euro to 1.123 at the London market close.

“The pound was trading lower, giving back some gains from the previous session. Concerns over the outcome of Brexit and the impact that Brexit will have on the economy continued to dominate sentiment towards the pound,” Ms Cincotta said.

In stocks, Unilever shares were flat after the consumer goods giant announced the departure of boss Paul Polman.

Mr Polman, who fended off Kraft’s takeover bid and oversaw a failed plan to abandon its London listing, is to retire in the new year.

He will be replaced by Alan Jope, current president of the group’s beauty and personal care division.

Shares closed down 3.5p at 4,254.5p.

On the FTSE 250, shares in shopping centre owner Intu plummeted after suitors pulled a £2.8 billion takeover bid.

Intu, which owns the Arndale Centre in Manchester and Gateshead’s Metrocentre, was subject to a sustained sell off after a consortium of bidders blamed economic uncertainty and market volatility for the deal’s collapse.

Intu said market conditions meant the consortium – led by John Whittaker’s Peel Group – could not continue with its proposed offer within the timeframe set out by City takeover rules.

Shares were down 78.1p, or 40.5%, to 114.5p at the close.

Thomas Cook shares, meanwhile, continued their downward trajectory as the travel giant released further details of a “disappointing” financial year, two days after its stock plunged following a profit warning.

The group unveiled a loss after tax of £163 million, compared with a profit of £9 million this time last year.

As the company previously flagged in an unscheduled statement on Tuesday, underlying earnings were £58 million lower at £250 million in the year to September 30.

Shares were down a further 2.4p, or 6.65%, at 33.68p.

In Europe, Germany’s DAX shed 0.01% while France’s CAC 40 was up 0.47%.

The biggest risers on the FTSE 100 were Ashtead up 68p at 1,795.5p, Antofagasta up 30p at 836.4p, Anglo American up 51.2p at 1,611p and Wood Group up 19.2p at 646.6p.

The biggest fallers on the FTSE 100 were British Land down 35p at 570p, Land Securities down 43p at 835.4p, Severn Trent down 73p at 1,877p and Persimmon down 48.5p at 1,965.5p.

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FTSE 100 lifted into positive territory by miners

The owner of the Daily Mail and Metro newspapers has revealed a 16% slide in annual profits and warned consumer revenues will remain under pressure next year despite an online boost.

Daily Mail and General Trust (DMGT) saw its shares fall 7% after reporting underlying pre-tax profits of £182 million for the year to September 30, down from £226 million the previous year.

It saw advertising revenue from its Mail Online operations overtake its sales from the Mail’s print advertising for the first time in what it dubbed an “important milestone”.

But despite this, revenues from its consumer media arm dropped 4% over the year to £654 million.

The group also expects further falls in 2019, forecasting an underlying rate of decline in the “mid-single digits” despite a recent cover price hike for the Daily Mail from 65p to 70p following last year’s Mail on Sunday price rise.

It also expects newspaper circulation numbers to continue declining.

Paul Zwillenberg, chief executive of DMGT, said: “DMGT’s performance during the year was in line with our expectations despite some challenging trading conditions.”

On a statutory basis, the group swung to a £692 million pre-tax profit from losses of £112 million the year before thanks to the sale of commercial real estate service EDR and its stake in Zoopla firm ZPG.

Over the year, print advertising revenues for its Mail newspapers tumbled 9% amid “continued structural and competitive challenges facing the UK national newspaper advertising market”.

But Mail Online underlying revenues grew by 5% and now account for 51% of total Mail advertising.

DMGT’s Metro free-sheet saw underlying revenues rise by 4% to £71 million and now claims the largest circulation of any weekday newspaper in the UK, read by an average of 2.8 million people every day.

Overall, the consumer media division housing its newspapers saw underlying earnings fall 22% over the year to £64 million.

DMGT said: “The consumer media business is expected to benefit, despite the recent challenging market conditions, from digital advertising growth and to experience circulation volume and print advertising declines, with advertising revenues likely to remain volatile.”

Meanwhile, the group’s business-to-business division enjoyed a more resilient performance over the year, with underlying earnings 1% lower at £128 million.

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Daily Mail group sees profits slide despite online ‘milestone’

The pound was subject to another day of volatility as currency traders digested a flurry of reports that detailed the impact of a hard Brexit.

Sterling made gains early in the day before dipping, and then rose again following the market close, just as the Bank of England released a doomsday Brexit assessment.

The pound was up 0.5% versus the US dollar to 1.280 US dollars and flat against the euro at 1.12 in evening trade.

It came after the Bank warned that the pound would crash, inflation soar, interest rates would have to rise and Britain’s growth would plummet in the event of a no-deal disorderly Brexit.

The apocalyptic outcome, contained in the Bank’s analysis of various EU withdrawal scenarios, would also see unemployment skyrocket.

Earlier in the day, the Government released its own Brexit impact assessment, which found that withdrawal from the EU under Theresa May’s plans could cut the UK’s GDP by up to 3.9% over the next 15 years.

But leaving without a deal could deliver a 9.3% hit to GDP over the same period and the UK will be poorer in economic terms under any version of Brexit, compared with staying in the EU.

The FTSE 100, meanwhile, closed down 12.33 points, or 0.18%, at 7,004.52.

In stocks, shares in the Restaurant Group took a hammering after the firm clinched approval for its controversial takeover of the Wagamama chain, despite a significant level of opposition from shareholders.

The full results showed just under 61% of shareholders supported the £559 million deal, which will be paid for through a combination of a £315 million rights issue and a £220 million revolving credit facility.

The Restaurant Group – which is also behind Frankie & Benny’s and Garfunkel’s – said it would engage with investors to address their concerns.

However, this fell on deaf ears as sceptical investors sent shares down 35.5p, or 15.1%, to 199.5p at the close.

Shares in Telford Homes were on the rise despite the housebuilder warning it still has “work to do” to meet its full-year profit targets, adding that Brexit has added further uncertainty to its ability to hit forecasts.

The London-focused group said it has just under 60 house sales to achieve, of which 20 are priced above £600,000 – the price bracket that has been hardest hit by Brexit worries.

While this is down from 90 homes left to sell in October, the group is concerned over buyer demand amid mounting uncertainty about Brexit.

Nevertheless, the company’s stock was up 10.5p at 310p.

In Europe, Germany’s DAX was down 0.09% while France’s CAC 40 was flat.

A barrel of Brent crude was trading at 60 US dollars, a decline of over 1%.

The biggest risers on the FTSE 100 were Antofagasta up 27.8p at 806.4p, Ocado up 17.4p at 833.4p, Just Eat up 11p at 589p and Ferguson up 90p at 4,907p.

The biggest fallers on the FTSE 100 were easyJet down 59.5p at 1.159.5p, Persimmon down 99p at 2,014p, Taylor Wimpey down 6.2p at 141.4p and IAG down 24.6p at 632.4p.

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Sterling has topsy turvy day as Brexit papers unleashed on markets

Markets traded lower on Tuesday on investor concerns over Britain’s departure form the European Union, Italy’s budget issues and US-China trade tensions.

The FTSE 100 closed 19.15 points, or 0.3%, lower at 7,016.85.

France’s Cac was down 0.2%, while Germany’s Dax fell 0.4%.

David Madden, market analyst at CMC Markets, said: “Stock markets are in the red following yesterday’s bullish move. Fears regarding US-China trade, Italy’s budget and Brexit all play into the mix.

“President Trump warned that the levy on Chinese imports might be increased, and further tariffs could be announced. This dampened investors’ hopes about a deal being struck at the G20 summit.”

Meanwhile, the pound came under pressure as opposition to Prime Minster Theresa May’s EU Withdrawal Agreement continued.

The pound was down over 0.5% versus the US dollar at 1.273 and the British currency shed 0.2% against the euro to finish the session at 1.128.

Mr Madden said: “The DUP, who are propping up the Conservatives at Westminster, have made it clear they won’t support it. Former defence secretary Michael Fallon said it was ‘doomed’.

“The chances of a ‘no-deal’ Brexit have increased as there is speculation that the deal will be voted down, and that is weighing on the pound.”

Oil prices were largely unchanged as investors continued to fret about oversupply and the trade tariffs between the US and China.

“Saudi Arabian production reached a record high, and tensions are rising between the US and China in relation to trade, and dealers are cautious that demand might drop too.” Mr Madden said.

A barrel of Brent crude was up 0.4% at 60.63 US dollars (£47.60).

In corporate news, Thomas Cook closed 10.98p, or 23%, lower to 37.56p after it issued its third profit warning of the year.

The company said it would take a £30 million hit to profits in an unscheduled announcement due to extra costs and the effect of the heatwave on holiday bookings.

Topps Tiles shares fell 1p to 65p after the company said it is stockpiling key products ahead of Brexit as it prepares for possible supply disruption.

The retailer said it would increase stock levels of “key selling lines” ahead of March 2019, echoing the likes of Premier Foods and Pets at Home – which have also said they will store products in case of disruption.

Shares in Greggs rose 136p to 1,373p after the bakery chain upped its full-year profit outlook thanks to a rise in sales following strong autumn trading.

The group, which has more than 1,900 shops across the UK, saw like-for-like sales growth strengthen to 4.5% in the eight weeks to November 24.

Pets at Home shares were down 1.3p to 113.3p after the company revealed action to stockpile pet food and products worth millions of pounds ahead of Brexit as it announced 30 vet practices are set for possible closure.

New chief executive Peter Pritchard, who took on the top job in May, told the Press Association the group has already imported goods worth a “couple of million pounds” as part of no-deal Brexit contingency plans.

The biggest risers on the FTSE 100 were Coca-Cola up 104p to 2,373p, Ocado up 26.20p to 816p, Kingfisher up 5.7p to 253.8p, and Intertek up 106p to 4,752p.

The biggest fallers on the FTSE 100 were Johnson Matthey down 127p to 2,950p, GVC Holdings down 30.20p to 778.5p, Antofagasta down 27.20p to 778.6p, and Evraz down 15.50p to 460.6p.

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Markets lower on Brexit, Italy & US-China woes

Markets rose on Monday as investors clung onto the possibility that Theresa May could get her Brexit deal approved in Parliament after EU leaders backed it over the weekend.

Reports that Italy might reduce its deficit requirement for its budget were also supportive to European trade.

David Madden, market analyst at CMC Markets, said: “News over the weekend that EU leaders endorsed the deal for the UK’s exit of the bloc has also lifted investor sentiment.

“Traders are clinging onto the possibility that Theresa May will get enough support to get the deal approved.

“Mrs May will have an uphill struggle, but some MPs might vote in favour of it as they are too scared of no-deal scenario.”

He said the pound is likely to hold-up in the absence of ‘no-deal’ chatter, however if opposition to the deal ramps-up it would “likely hurt the pound as it would open up the possibility of a no-deal situation.”

The FTSE 100 closed 83.14 points, or 1.2%, higher at 7,036.

France’s Cac was up 1% while Germany’s Dax rose 1.5%.

The pound was down 0.1% against the US dollar to 1.281 US dollars and was down 0.1% versus the euro at 1.130.

Meanwhile, Oil prices recovered from Friday’s lows on concerns of a supply glut.

Mr Madden said: “Oil has rebounded as short covering and bargain hunting has driven the price higher.

“The energy might be moving higher today, but the backdrop is still very negative. Concerns about supply persist.

“That being said, there is speculation that Opec (the Organisation of the Petroleum Exporting Countries) will announce production cuts at their meeting in December.”

In corporate news, shares in WPP closed up 26.40p, or 3.1%, to 879p after the advertising giant said it will merge its Wunderman and J Walter Thompson agencies.

The group, which has been rocked by the departure of founder and chief executive Sir Martin Sorrell, said that the merged entity will be called Wunderman Thompson, with a focus on creative, data and technology.

Shares in Faroe Petroleum rose 33.80p, or 27%, after its largest shareholder launched a £608 million takeover bid for the company.

DNO, a Norwegian firm which already owns more than 28% of Faroe, said it was offering a “considerable premium” for investors wishing to exit amid the uncertainty of the oil market.

Rio Tinto shares slipped 13p, or 0.4%, to 3,629p after the mining giant announced the sale of an African uranium business as part of its strategy to shed unwanted assets.

The Anglo-Australian firm will sell its majority stake in Namibian mine owner Rossing Uranium to China National Uranium Corp for up to 106.5 million US dollars (£83.1 million).

A barrel of Brent crude was trading up 2.6% at 60.70 US dollars (£47.35).

The biggest risers on the FTSE 100 were Wood Group up 44.80p, or 7.6%, to 632.4p, Vodafone up 9.7p, or 6.3%, to 164.82p, Fresnilo up 4.2%, or 31.4p, to 777.8p, and Prudential up 56.5p, or 3.7%, to 1,575p.

The biggest fallers on the FTSE 100 were Just Eat down 21.2p, or 3.5%, to 581p, Royal Mail down 7.10p, or 2.1%, to 332.9p, Paddy Power down 150p, or 2.1%, and Melrose Industries down 3.65p, or 2%, to 178.2p.

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Markets rise on possibility Theresa May could get Brexit deal approved

Visa index shows spending fell in 2017 as rising living costs and Brexit uncertainty hit confidence.

Britons are slashing spending on new clothes, cars and foreign holidays, according to new figures that underscore the effect on consumer confidence of rising living costs and the uncertainty surrounding Brexit, The Guardian reports.

Spending fell last year according to Visa’s consumer spending index, which it said was the longest-running slump since February 2013. The 0.8 per cent year-on-year decline in July was worse than June’s 0.2 per cent drop, but not as steep as the fall of 0.9 per cent in May.

“Consumer spending fell for the third month in a row in November 2017, the first time overall spending had fallen for three consecutive months since February 2013,” said Kevin Jenkins, Visa’s UK and Ireland managing director. “The figure provides further evidence that rising prices and stagnant wage growth are squeezing consumers’ pockets.”

The spending tracker highlighted a grim period for clothing and household goods retailers, with the amount Britons spent on updating their wardrobes and homes dropping 5.2 per cent and 4 per cent respectively. There was also evidence that staycations are in vogue this summer, with a drop in flight bookings contributing to a 6.1 per cent fall in spending on transport and communications.

Last week the clothing giant Next said sales at its high street stores had fallen 7.4 per cent over the past three months, and its chief executive, Simon Wolfson, described a “very difficult consumer environment for clothing”. July was also said to be the worst month for fashion retailers in eight years by the accountancy firm BDO in its monthly high street sales tracker. Sales were down 3.5 per cent despite summer sales being in full swing, according to the survey of retailers that between them have 10,000 stores.

Figures from the UK car industry also showed new sales falling for the fourth month running as Brexit uncertainty weighed on demand. Sales fell 9.3 per cent in July to 161,997 as consumers and businesses grew increasingly reluctant to commit to big spending decisions.

However used car sales are still strong and you can find Used cars for sale on London by Hertz Rent2Buy.

Buying a used car is a far more cost effective route to car ownership at a time when there is financial uncertainty.

Annabel Fiddes, an IHS Markit economist, said households were having to cope with rising living costs against a backdrop of slowing earnings growth, highlighting recent government data showing total real pay falling at the quickest pace for nearly three years.

“Alongside the renewed squeeze on household budgets, uncertainties linger over the direction of the economy and the outcome of the ongoing Brexit negotiations, which is weighing down consumer confidence,” said Fiddes. “All this makes it seem unlikely that consumer spending will recover in the current challenging conditions, and adds to expectations that the Bank of England will not hike rates any time soon.”

Last month the chancellor, Philip Hammond, admitted that the country’s slowing economic growth was down to the squeeze on the cost of living caused by more expensive imports. “Consumers are being affected by the inflation that was created by the depreciation of the currency in the autumn of last year,” he told one interviewer. “That will pass through the economy, but I absolutely recognise it’s painful as it’s passing through the economy.”

The economy grew by just 0.3 per cent in the second quarter of 2017, which followed 0.2 per cent expansion in the first three months of the year, according to the Office for National Statistics. Darren Morgan, the head of national accounts at the ONS, described the figures – which were below the long-term growth trend – as a “notable slowdown”.

It was not all doom and gloom. The Visa data pointed to an early surge in summer staycations boosting the domestic leisure industry, as the weakness of sterling made going abroad more expensive. Its analysis showed a 6% increase in spending in UK hotels, restaurants and bars. “The leisure sector is likely to have benefited from an early surge in summer staycations, as the weak pound made holidaying at home more attractive,” said Jenkins.

Last week, the Bank of England governor, Mark Carney, said there were signs that the uncertain outcome of Brexit negotiations was affecting firms’ plans to invest and to award pay rises. A survey of FTSE 350 company secretaries for the Financial Times by the governance body, Icsa, found rising concern about political risk – most likely because of uncertainty around Brexit negotiations.

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UK consumers cut spending on clothes, cars and foreign travel

Betting firm William Hill has been hit with a £6.2m penalty package for breaching anti-money laundering and social responsibility regulations.

The Gambling Commission said the company did not do enough to ensure prevention measures were effective reports the BBC

As a result 10 customers were able to deposit money linked to criminal offences and William Hill gained £1.2m.

The company was found to have not done enough to determine the source of the money or if they were problem gamblers.

The penalty is the second biggest imposed by the Commission, following last year’s £7.8m action against betting firm 888.

In a statement, the Gambling Commission said William Hill’s senior management “failed to mitigate risks and have sufficient numbers of staff to ensure their anti money laundering and social responsibility processes were effective”.

External checks

Gambling Commission executive director Tim Miller told the BBC that William Hill should have been “checking the source of money and understanding their customers and ensuring that potentially vulnerable customers are properly protected”.

The investigation by the Gambling Commission covered the period between November 2014 and August 2016.

William Hill will pay more than £5m for breaching the regulations and “divest themselves of the £1.2m they earned from transactions with the 10 customers”, the Commission said.

The company now has to appoint external auditors to review the effectiveness and implementation of its anti-money laundering and social responsibility policies and procedures

Neil McArthur, executive director at the Gambling Commission, said: “This was a systemic failing at William Hill which went on for nearly two years and today’s penalty package – which could exceed £6.2m – reflects the seriousness of the breaches.”

‘Get this right’

In a statement, William Hill chief executive Philip Bowcock said: “William Hill has fully co-operated with the Commission throughout this process, introducing new and improved policies and increased levels of resourcing.

“We have also committed to an independent process review and will work to implement any recommendations that emerge from that review.

“We are fully committed to operating a sustainable business that properly identifies risk and better protects customers.

“We will continue to assist the Commission and work with other operators to improve practices in the areas identified.”

Mr Miller said the Gambling Commission was sending a message to the industry as a whole that “you need to take your responsibility seriously, you need to get this right”.

“We are always taking regulatory action and I don’t think this will be the last action we take,” he added.

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William Hill fined £6.2m by Gambling Commission for lax controls

Sir Philip Green has vehemently denied a report that he is planning to sell his Arcadia retail empire.

In a statement, Arcadia said a story in The Sunday Times claiming Sir Philip is in talks to offload all or part of the Topshop-owner is “totally false”.

The newspaper said Sir Philip is in discussions with China’s Shandong Ruyi about a potential deal.

However, Arcadia said neither Sir Philip or its directors “have ever met or had any contact with Shandong Ruyi”.

The article also alleges that Sir Philip has been in discussions with bankers from HSBC about separating Topshop from Arcadia.

But Arcadia said the statement regarding discussions with HSBC are “totally untrue”, and claimed the report was “further evidence” of a “personal vendetta against Sir Philip and his companies”.

It said: “The 22,000 people that work at Arcadia should not be subjected to this type of malicious rumour-mongering.”

In response, The Sunday Times said: “This is a public interest story, which The Sunday Times investigated thoroughly before publication, and we stand by our report.”

Sir Philip’s Arcadia group, whose brands also include Burton, Miss Selfridge, Dorothy Perkins and Wallis, has 2,800 stores across the world.

However, his flagship chain, Topshop, has struggled against competition from the rise of online rivals such as Boohoo and Asos.

‘Pension payment’

Following The Sunday Times story, Frank Field, chairman of the Work and Pensions Committee, said that he had written to Sir Philip Green asking if he will he seek clearance from The Pension Regulator for any deal.

Arcadia, which confirmed receipt of the letter, said that it had promised to pay £50m a year into its pension fund, “the most recent payment being made this month”.

It added: “The group remains unborrowed at the operating level and has substantial property assets.”

The Work and Pensions Committee last year investigated the sale and subsequent collapse of BHS, which Sir Philip sold to an investment vehicle called Retail Acquisitions Ltd in 2015 before it went bust the following year.

Mr Field has criticised Sir Philip’s actions, and last August the businessman sent a legal warning to the MP.

Shandong Ruyi has been expanding in Europe. It has bought controlling stakes in the Swiss luxury leather goods company Bally and London-listed fashion manufacturer Bagir.

The Chinese company bought Acquascutum last year for £95m.

Read more:
Sir Philip Green denies retirement & business sell-off rumours

Could we see a new Concorde take to the skies? Billionaire entrepreneur Sir Richard Branson thinks so.

The man behind the Virgin empire has said that a new era of supersonic travel is about to take off reports CityAm.

“The next big thing, hopefully in my lifetime, will be supersonic travel coming back and people travelling around the world in next to no time,” he said, speaking to Bloomberg.

Concorde was retired in 2003, but Branson wants to bring back the way of travelling which was the height of style during its 70s and 80s heyday. He has partnered with startup Boom to get the aircraft flying by 2023.

President Donald Trump this week proposed budgeting for Nasa that includes funding for the development of supersonic travel.

The creator behind the Virgin Galactic space company also said he hoped to launch something “equally as dramatic” as his friend and rival Elon Musk, who launched a Tesla carrying SpaceX rocket to Mars last week.

“We’re not far behind him and I think this year I’d be very disappointed if we haven’t done something equally as dramatic perhaps than Elon has achieved… maybe even more dramatic,” he said.

He also thinks that there’s a “good chance Virgin Galactic can put people into space before any other private spaceship company”.

He revealed that Hyperloop One, now part owned by Virgin with Branson as chairman, will this weekend announce details of more ambitious tests of the super fast transport system. Last year, it reached 200mph on tracks in Las Vegas.

Meanwhile, he slammed the idea of nationalised businesses, saying that they were more competitive and entrepreneurial when private. The comments come after the rail franchise part run by Virgin, East Coast, received a government bailout.

The country is “more successful” as a result of privatisation, Branson said, adding that it was “akin to Russia” when government used to run companies.

Read more:
Branson looks to launch ‘Concorde 2’ with new supersonic venture

Apple removed messaging app Telegram from its app store because some users were sharing images of child abuse.

The explanation was revealed in an email from Phil Schiller, manager of the App Store, which was published by Apple news site 9to5Mac.

The secure messaging app returned to the app store within hours with fixes to prevent the illegal content being served to users, it said.

Mr Shiller said users “who posted this horrible content” had been banned.

The email, which 9to5Mac said it had verified with Apple read: The Telegram apps were taken down off the App Store because the App Store team was alerted to illegal content, specifically child pornography, in the apps.

“After verifying the existence of the illegal content the team took the apps down from the store, alerted the developer, and notified the proper authorities, including the NCMEC (National Center for Missing and Exploited Children).”

Apple said it had put in place more controls to “keep this illegal activity from happening again”.

Telegram has been accused of harbouring violent and extremist content on its platform in the past and its use was restricted in Iran in December after claims it was used to organise four days of anti-establishment protests.

And in November, Afghanistan moved to ban the app in an effort to prevent the Taliban and other insurgent groups from using it.

The messaging app has a high level of encryption and allows for large chats of up to 50,000 users. Its secret chat function allows messages to self-destruct after they are sent.

Prime Minister Theresa May recently singled out the app as a place where criminals can hide their activities.

“No-one wants to be known as the terrorists’ platform or the first-choice app for paedophiles,” she said.

Read more:
Child abuse images behind Telegram app ban

Soho House, one of the world’s biggest networks of private members’ clubs, is plotting a flotation in New York‎ that will value the company at about $2bn (£1.4bn).

Read more:
Soho House finds new home with $2bn New York float

Lloyds Banking Group has banned credit card customers from buying bitcoin amid fears it could be left in debt as the cryptocurrency’s value deflates.

The banking giant, which includes Halifax, MBNA and Bank of Scotland, is thought to be the first in the UK to ban credit card customers from borrowing to buy the cyptocurrency, which has more than halved in value in recent months, reports The Guardian.

Bitcoin’s slide has led to concerns that people who borrow money to purchase it will be left with large debts if the virtual currency continues to depreciate.

Significant numbers of people in Britain are thought to have bought bitcoin as it surged in value, peaking at nearly $20,000 (£14,465) in December. As news of Lloyds’s ban emerged on Sunday the value was about $8,000 (£5,700).

A spokeswoman for the banking group said: “Across Lloyds Bank, Bank of Scotland, Halifax and MBNA, we do not accept credit card transactions involving the purchase of cryptocurrencies.”

The move follows warnings by regulators in the US, South Korea, China, Russia and India. Germany’s Bundesbank has also called for global regulation of bitcoin and France’s finance minister wants tougher rules for cryptocurrencies.

Meanwhile, Facebook banned adverts for bitcoin and other cryptocurrencies on its sites after recent criticism from users about scams and hoaxes being promoted in their newsfeed. Critics say cryptocurrencies are used by criminals and rogue states to carry out clandestine transactions.

This month US billionaire Warren Buffett ruled out a foray into cryptocurrencies, warning the Bitcoin boom will “come to a bad ending”.

The chairman and chief executive of Berkshire Hathaway has joined the chorus of voices criticising the digital currency. His comments came just a day after JP Morgan’s chief executive, Jamie Dimon, said he regretted calling bitcoin a “fraud”, though he is still not interested in the digital currency.

Despite the slide, bitcoin’s current value is significantly higher than its $900 (£640) position recorded in January 2017.

Read more:
Lloyds Bank bans customers from buying bitcoins using credit cards

Ryanair has launched a €750m (£662m) share buyback and sought to reassure shareholders that it is equipped to remain Europe’s biggest low-cost airline after caving in to a unionisation drive from pilots.

Staff costs will increase by €45m this year as the Irish company lifts pay for its flight crews, and there may be further disruption to operations as the pilot dispute plays itself out, Ryanair said in a statement on Monday.

The carrier pledged to remain the most competitive in Europe, saying extra-dense Boeing 737 Max planes will help retain that advantage, reports The Telegraph.

“After 30 years of successfully dealing directly with our people it became clear in December that a majority of pilots wanted to be represented by unions,” said chief executive Michael O’Leary, adding that the decision to ground planes in order to cope with rostering issues that triggered the spat had been a “painful” one.

Read more:
Ryanair launches £662m share buyback but forecasts ‘adverse PR’ ahead

Downing Street has insisted Britain will leave the EU customs union after Brexit amid claims of Tory disunity over the UK-EU future relationship.

The BBC Reports that Theresa May has faced calls to spell out what she wants from the talks ahead of the UK’s departure in March 2019.

In a customs union the UK would have tariff-free trade within the EU, but would lose the ability to strike its own deals with other countries.

It comes ahead of a meeting with the EU chief negotiator Michel Barnier.

The prime minister and Brexit Secretary David Davis will meet Mr Barnier ahead of the next round of negotiations getting under way.

Later, talks between officials will focus for the first time on the transitional period planned for after Brexit.

Potential sticking points include citizens’ rights, with the UK insisting EU nationals arriving during this time should not have the same rights as those who arrived before Brexit day.

Mr Davis and Mr Barnier are expected to reveal the progress of negotiations on Friday.

‘Not going to surrender’

How close the UK will remain to the EU’s single market and customs union has been a topic of debate among leading Brexiteers and some of those closest to the prime minister.

On Sunday Eurosceptic Tory Bernard Jenkin accused the government of being “vague” and “divided”, saying Chancellor Philip Hammond was not sticking to the approach put forward by the prime minister.

Home Secretary Amber Rudd – who was a leading figure in the Remain campaign – played down the divisions in the cabinet, telling the BBC’s Andrew Marr Show on Sunday: “I have a surprise for the Brexiteers, which is the committee that meets in order to help make these decisions is more united than they think.”

Ms Rudd said they agreed on the need for “frictionless trade“, the ability to strike international trade deals and to avoid a hard border in Ireland, hitting back at those who question whether such a deal can be secured.

“We want to have a bespoke agreement,” she said. “Now we’re not going to surrender before we have that battle.”

She said Mrs May had an “open mind” on how customs will be managed after Brexit.

Quizzed on what the model might look like, she said she was “not intimidated at all” by critics’ warnings about customs unions membership.

Mr Hammond has said he hopes the UK and EU economies will only move “very modestly” apart after Brexit. But some Brexiteers say this would hamper the UK’s ability to strike free trade deals with other countries after it leaves the EU.

The 10-strong Brexit cabinet sub-committee is due to meet on Wednesday and Thursday.

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Downing Street insists UK will leave customs union

BT Group revenue fell 3 per cent in the third quarter, missing analysts’ estimates for a gain, as its struggling IT business showed continued weakness.

The company reported revenue of £5.97bn in the three months to December 31, compared with an average estimate of £6.07bn, according to a survey of analysts, reports The Telegraph.

Profit before tax rose 25 per cent to £660m while adjusted earnings before interest, taxes, depreciation and amortisation fell 2 per cent to £1.83bn, roughly in line with analysts’ forecasts.

Its TV service lost 5,000 customers during the quarter, BT reported, versus the addition of 52,000 customers in the same period a year ago.

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BT revenue slips as IT business struggles

Apple’s latest iPhone range sold about a million fewer handsets in the last three months of 2017 – but the firm still pulled in record revenues of $88.3bn (£62bn).

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iPhone sales dip but Apple still hits record revenues

The future of Toys R Us’s UK operations – and thousands of jobs – has been thrown into fresh doubt just weeks after creditors approved a radical rescue plan.

Read more:
Toys R Us UK future in fresh doubt as US parent hunts buyer

More than £1bn was wiped off the stock market value of the government contractor Capita on Wednesday, sparking fears of job losses and forcing Downing Street to play down the threat of a collapse echoing the demise of rival Carillion.

Capita, whose major contracts range from collecting the BBC licence fee to electronic tagging of prisoners, saw its share price nearly halve in a day following a grim financial update that reignited concerns over the outsourcing industry and the stability of public services, reports The Guardian.

The prime minister’s spokesman insisted Capita was not in a similar position to Carillion, whose collapse earlier this month plunged thousands of workers and small businesses into uncertainty.

“Broadly we monitor the financial health of all our strategic suppliers, including Capita, and we are in regular discussions with them regarding their financial position,” said Theresa May’s spokesman. “And [I would like] to emphasise we do not believe that any of our strategic suppliers including Capita are in a comparable position to Carillion.”

Capita’s shares plunged 47.5%, cutting its stock market value by £1.1bn, after new chief executive Jonathan Lewis stunned markets by admitting the company’s finances were in a dire state and announcing drastic measures to repair them.

Lewis, appointed in October last year, downgraded Capita’s profit forecasts and announced plans to raise £700m to shore up its balance sheet. He also axed a dividend that had been worth more than £500m to investors over the past three years.

A cost-cutting programme is expected to result in job losses among Capita’s 67,000 employees, 50,000 of whom are in the UK, while parts of the business will be sold to raise cash.

Within 10 hours of its statement to the City, Capita’s stock market value had fallen to £1.2bn, with a £381m pension deficit and debts predicted to hit £1.15bn by the end of the year.

Lewis said the company, which has grown rapidly through a string of acquisitions, had become “too complex” and admitted the firm was lacking in discipline.

The measures announced by Lewis are likely to be interpreted as pre-emptive action to ensure a profitable future at a challenging time for the outsourcing industry, signalled by Carillion’s collapse. The outsourcing model involves the government farming out public sector work to private companies.

Like Carillion, Capita counts the UK government among its major clients with contracts that include running London’s congestion charge scheme, tagging prisoners, operating a jobseeker’s allowance telephone line and administering the teachers’ pension scheme. It also collects the licence fee for the BBC.

Labour said the government should take steps to oversee the activities of Capita. “The Tories’ privatisation dogma risks lurching our public services from crisis to crisis, threatening jobs, taxpayers’ money and leaving people without the services they need,” said Jon Trickett, the shadow minister for the Cabinet Office.

“The government must end its ideological attachment to private profit in public services and instead start putting the public interest first.”

Frank Field, chair of the work and pensions committee, said it would be looking into Capita. In a statement that referred to the accounting group that signed off Carillion’s figures, KPMG, he said: “Another day, another outsourcing firm with massive debt, a huge pension deficit, a KPMG audit and the big four popping up at every turn in the company’s chequered history.

“Sadly, Capita goes on the growing list of firms we are investigating to see if their conduct has endangered current and future pensioners’ rights.”

Some City analysts said Capita still had plenty of time to avoid the fate of Carillion.

David Madden, an analyst at City firm CMC Markets, said the action from Capita was “a red alert” for investors but added that it “could turn itself around”.

“Carillion collapsed but Capita is still in the game,” Madden said.

Frances O’Grady, the general secretary of trade union body the TUC, said the profit warning from Capita was “really worrying” and urged the government to act.

“We can’t afford another Carillion. The TUC is calling for an urgent risk assessment of all large outsourcing firms. It’s essential the government completes this quickly and is prepared to bring services and contracts in-house if they are at risk.”

Lewis said the measures announced on Wednesday were the “first steps in the road to recovery,” predicting his turnaround would take two years.

“Today, Capita is too complex,” he said. “It is driven by a short-term focus and lacks operational discipline and financial flexibility. [It] needs to change its approach. Cost savings and non-core disposals alone will not be enough. We have also taken the significant decision to suspend the dividend and seek equity.”

Capita said it was also undertaking a triennial review of its pension scheme and expected its pension deficit to reduce from the £381m level at the last assessment in summer 2017 as a result of increasing contributions.

Its former rival Carillion has faced criticism for continuing to pay dividends and big executive salaries as debts mounted, eventually leading to a collapse of the company earlier this month.

The work and pensions committee on Wednesday wrote to former investors in Carillion and HM Revenue & Customs as part of a wide-ranging inquiry into the company’s collapse.

The committee asked former shareholders, including major financial institutions BlackRock, UBS and Deutsche Bank, for opinions on how the company was run and why they chose to sell shares when they did.

The committees also asked the Federation of Small Business to provide an overview of Carillion’s payments to suppliers and wrote to Santander bank to ask about reports that it stopped payments to some Carillion suppliers without notice in December.

HMRC has been asked about Carillion’s performance in paying tax and the firm’s total outstanding tax liability.

Read more:
More than £1bn wiped off value of Capita

Informa has sealed its £3.8bn takeover of conference organiser UBM on Tuesday, creating an enlarged business information and events firm.

FTSE 100 company Informa will pay 1.083 new shares and 163p in cash for each UBM share under the terms of the deal, in line with an announcement earlier this month, reports The Telegraph.

The deal, which comes almost a decade after UBM tried to buy Informa, will create a world leader in events, the fastest growing part of Informa’s business.

“It is clear that the business-to-business (B2B) market is moving to operating scale and industry specialisation,” Informa chief executive Stephen A. Carter said.

“Our recommended offer for UBM promises to create a leading B2B Information Services Group with the international reach and market capabilities to take full advantage of these trends.”

He said the deal would create at least £60m of cost savings a year after the businesses were integrated by 2019.

UBM also updated the market on its recent trading, saying the fourth quarter had been ahead of expectations and as a result it expected its full-year profit to be ahead of forecasts.

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Informa seals £3.8bn takeover of UBM

Silicon Valley billionaire Marc Benioff has compared the current crisis of trust facing the tech giants to the financial crisis of a decade ago, urging regulators to wake up to the threat from Google, Facebook, and the other dominant firms.

The outspoken entrepreneur accused some of the industry’s most influential bosses of “abdicating responsibility” and being ignorant to how powerful and sophisticated they had become, reports The Telegraph. Regulators now had “have no choice” but to intervene, he said.

“We are in a new world. A decade ago, you had the banks talking about collaterised debt obligations and credit default swaps, saying they were great for the economy but regulators weren’t paying attention. The government needs to come in and point ‘True North’,” Mr Benioff said at a panel session at the World Economic Forum in Davos, Switzerland.

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World must ‘wake up to threat from tech giants’

The chair of an influential House of Commons committee has urged the Prime Minister to make good on her promise to crackdown on “unscrupulous” company bosses by imposing billion-pound fines.

Read more:
PM urged to levy £1bn fines in bosses crackdown after Carillion collapse

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Amazon’s first checkout-free grocery store opens on Monday

The Bitcoin boom is set to boost hiring in the City this year as financial companies race to stay ahead of the game in developing Blockchain technology, a leading headhunter has predicted.

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City hiring to rumble on despite Brexit as Bitcoin boom creates jobs

Ryanair has been referred to employment and tax authorities for investigation by two parliamentary committees, citing the airline’s “refusal to cooperate” with inquiries over crew pay and conditions.

Frank Field, chair of the work and pensions committee, and Rachel Reeves, chair of the business select committee, have written to HMRC and the director of labour market enforcement asking them to investigate Ryanair and the agencies that supply its cabin crew, reports The Guardian.

Late last year, Ryanair declined to answer further questions about pay and employment practices, after an initial response failed to satisfy MPs.

The committees sought more information after reports that cabin crew were required to work for free, pay for training and uniforms and take significant periods of unpaid leave, which suggested that agency workers were receiving less than the living wage.

A letter from Ryanair’s HR director, sent on 21 December, said crew earned between €24,000 [£21,150] and €40,000 [£35,250] a year, double the legal minimum for the work carried out.

However, MPs said that the letter ignored many of their questions while the pay figures did not tally with a contract they had seen.

Field and Reeves have told HMRC and Sir David Metcalf, the government’s director of labour market enforcement, that despite Ryanair’s assurances, it appeared that cabin crew were being paid in a confusing and opaque way, that could mask low pay and poor conditions.

They wrote: “We believe it is vital that potential poor employment practices are examined not only to ensure the rights of Ryanair cabin crew are protected, but also to ensure that there is no ‘race to the bottom’ across the aviation sector.”

Field said: “We and the public can draw our own conclusions about Ryanair’s comprehensive failure to answer allegations on its pay and employment practices.” They had requested that HMRC extend its current investigation into Ryanair pilots to look at cabin crew, he said.

Reeves said she hoped that HMRC would look at the airline’s practices as a matter of urgency. “Ryanair might want to dodge our committees’ questions and hide behind excuses, but the UK is the largest provider of workers to the company and we must be sure that everyone working for Ryanair is receiving fair pay and reasonable working conditions.”

A spokeswoman for the airline said: “Ryanair has already confirmed to this committee that its pilots earn between €130,000 [£114,550] and €180,000 [£158,600] per annum and our cabin crew between €24,000 and €40,000, which is more than double UK national minimum wage, and since we also comply fully with UK employment law, we have no further comment in response to this committee’s inaccurate press releases.”

Earlier, the airline said that pilots across its 15 UK bases had voted to accept pay increases of up to 20 per cent, while talks continued with British pilot union Balpa over recognition.

Talks with Irish unions are also continuing, after the airline announced last month it would reverse previous policy and recognise unions.

Read more:
HMRC and employment tsar may question Ryanair over pay

HSBC has agreed to pay just over $100m (£72m) in penalties to settle a US Department of Justice probe into currency rigging.

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HSBC to pay $100m in currency rigging settlement

Apple said it will bring hundreds of billions of overseas dollars back to the US, pay about $38bn (£27bn) in taxes on the money and spend tens of billions on domestic jobs, manufacturing and data centers in the coming years.

The iPhone maker plans capital expenditures of $30bn in the US over five years and will create 20,000 new jobs at existing sites and a new campus it intends to open, the Cupertino, California-based company said Wednesday in a statement. Apple’s shares rose 1.7 per cent to a record closing price of $179.10 in New York, reports The Telegraph.

“We are focusing our investments in areas where we can have a direct impact on job creation and job preparedness,” chief executive officer Tim Cook said in the statement, which alluded to unspecified plans by the company to accelerate education programs.

Apple also told employees Wednesday that it’s issuing stock-based bonuses worth $2,500 each following the new US tax law, according to people familiar with the matter.

In its December approval of the most extensive tax-code revisions since 1986, Congress scrapped the previous international tax system for corporations – an unusual arrangement that allowed companies to defer US income taxes on foreign earnings until they returned the income to the U.S. That “deferral” provision led companies to stockpile an estimated $3.1 trillion offshore and many were criticized for the moves, including Apple.

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Apple to pay $38bn Trump tax bill

The head of the Serious Fraud Office has said there must be no let-up in the way financial criminals are pursued after the UK leaves the European Union.

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Fraud work cannot be scuppered by Brexit, says SFO head

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Heathrow to unveil shorter third runway plan in bid to cut costs

The construction firm Carillion, which is involved in a host of major government projects such as HS2 as well as vital public services including school dinners, has gone into compulsory liquidation, putting tens of thousands of jobs at risk.

Last-ditch talks by the company’s bank lenders at the weekend collapsed, even though emergency talks were hosted by the Cabinet Office, reports The Guardian.

Carillion said in statement to the London Stock Exchange: “Despite considerable efforts those discussions have not been successful, and the board of Carillion has therefore concluded that it had no choice but to take steps to enter into compulsory liquidation with immediate effect.”

An application was made to the high court for a compulsory liquidation of Carillion before the opening of business on Monday and an order has been granted to appoint the official receiver as the liquidator.

The accountancy firm PricewaterhouseCoopers (PwC) is expected to be appointed as special manager to act on behalf of the official receiver and handle the collapse of Carillion, which employs 43,000 people worldwide, including nearly 20,000 in the UK.

Rebecca Long-Bailey, the shadow secretary of state for business, energy and industrial strategy, told BBC Radio 4’s Today programme that big job losses could be avoided “if the government acts quickly and brings contracts back in-house”.

Carillion said the government would provide funding necessary to maintain the public services carried out by Carillion staff, subcontractors and suppliers. The government urged workers to go to work as usual and promised them they would be paid via the official receiver.

The firm is involved in many public infrastructure projects – from transport and health to education and defence – and provides other vital public services such as cleaning and catering in NHS hospitals, the provision of school dinners in nearly 900 schools and prison maintenance.

The Cabinet Office minister, David Lidington, said some services would be taken in-house while others would be handed to other operators “in a managed, organised fashion”.

He defended the government’s decision not to bail out the company and pointed to contingency plans drawn up following Carillion’s first profit warning in July. This means that contracts were drawn up so that if Carillion failed, other contractors would take over its responsibilities.

Rehana Azam, the national secretary of the GMB union, said: “The fact such a massive government contractor like Carillion has been allowed to go into administration shows the complete failure of a system that has put our public services in the grip of shady profit-making contractors.

“The priority now for the government and administrators is making sure kids in schools still get fed today – and our members still have jobs and pensions. What’s happening with Carillion yet again shows the perils of allowing privatisation to run rampant in our schools, our hospitals and our prisons.”

Labour and the Unite union called for an urgent inqiry into Carillion’s collapse. Unite also expressed concern about the impact on the wider supply chain, warning that many small firms were now at serious risk of collapse.

“PwC must put workers and suppliers at the head of the queue for payment, not the banks and certainly not the Carillion boardroom,” Unite said.

Jon Trickett, the shadow minister for the Cabinet Office, said: “Given £2bn worth of government contracts were awarded in the time three profit warnings were given by Carillion, a serious investigation needs to be launched into the government’s handling of this matter.”

Carillion ran into financial difficulties last year after issuing three profit warnings in five months and writing down more than £1bn from the value of contracts.

It has debts of about £1bn and a £600m pension deficit, and is being investigated by the Financial Conduct Authority over announcements made between December 2016 and July 2017.

Philip Green, the company’s chairman, said: “This is a very sad day for Carillion, for our colleagues, suppliers and customers that we have been proud to serve over many years. Over recent months huge efforts have been made to restructure Carillion to deliver its sustainable future.

“In recent days, however, we have been unable to secure the funding to support our business plan and it is therefore with the deepest regret that we have arrived at this decision.”

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Thousands of jobs at risk as Carillion goes into liquidation