Charlotte Street Partners

DAILY BRIEFING

DAILY BRIEFING

Independence day?

Written by Katie Stanton, associate partner
Edited by Kevin Pringle, partner
23 June 2020

Good morning,

The proposed date for the reopening of the hospitality sector and other venues in England – 4 July – also happens to be my birthday.
 
The words that pour from Boris Johnson’s mouth this afternoon will be the difference between a day spent sipping sweet, cold gin and tonics at some pub down on the Cornish coast, and another ‘special’ dinner at home – which is basically normal dinner, with added fuss and board games and pressure.
 
I hadn’t realised how important being able to go out to eat or drink or sip on a coffee is to my sense of self, and I think a lot of people have been similarly surprised at how integral the sector is to feeling ‘normal’. So I am sweating in anticipation, salivating at the thought of being able to get out and play ordinary, at least for a small, precious time.
 
Then I steel myself for a touch of perspective and contend that my selfish yearning is totally indulgent in comparison to the anxiety business owners must feel in this moment. Those business owners for whom today’s decision is the difference between survival or failure, redundancies or no redundancies.
 
It’s a big deal.
 
The prime minister spent last night with his medical and scientific advisors, agonising over the two-metre rule on social distancing. If he adopts a ‘one metre plus’ physical distancing rule from 4 July for all venues, including shops, restaurants, schools, museums, theatres, cinemas, offices and parks, as reported in The Telegraph on Saturday, then swathes of the economy will be able to open, and profitably.
 
UK Hospitality, the trade body, had warned that the industry’s usual revenues would be slashed by more than two thirds if restaurants and pubs had to abide by the current two-metre rule, and many would find it impossible to open altogether.
 
Of course, the risk of transmitting infection also becomes greater the closer we all get, and many are understandably nervous. To counteract this threat, people will be expected to take additional measures to protect themselves, such as wearing face coverings or only meeting outdoors. Oh, to be able to exercise one’s own judgement again!
 
Still, who knows what will happen when the prime minister takes the floor; our leaders have certainly surprised us before. But if what is being reported comes true at 12.30, I will be glad.
 
For those businesses that are thrown a crucial lifeline; for our endangered economy; for a discernible shift in tone – toward trusting and convivial, and away from suspicious and watchful – and for all those people feeling claustrophobic and anxious: finally, for where I live, there will be somewhere else to go to feel human.

News

US President Donald Trump has extended a pause on some green cards and suspended visas for other foreign workers until the end of 2020. The White House said the move will create jobs for Americans who are hurting economically as a result of the coronavirus pandemic.
 
Meteorologists have issued a health warning in advance of a heatwave this week, following a fortnight of cool and rainy weather. Temperatures over the next four days are expected to exceed 34C.
 
The headmaster of Eton College has apologised to Nigerian Dillibe Onyeama over the racism he suffered while a student at the school in the 1960s. Onyeama left Eton in 1969 and subsequently wrote a book about the racism he had experienced. He was banned from visiting as a result.

Business and economy

Nikhil Rathi of the London Stock Exchange has been appointed as the new chief executive of the Financial Conduct Authority to oversee the next stage of the UK’s regulatory response to the Covid-19 crisis. (£)
 
The UK’s car industry trade body has said one in six jobs are at risk of redundancy without help from the government in restarting production. The Society of Motor Manufacturers and Traders (SMMT) said emergency funding, permanent short time working, business rate holidays, and VAT cuts are needed to stem the flow of job losses.
 
The Financial Reporting Council is expected to announce tomorrow that it will investigate audits carried out by PWC, EY and Oliver Clive & Co for their role in the London Capital & Finance minibond scandal. (£)

The Scottish Government’s Advisory Group on Economic Recovery made 25 recommendations in its report published yesterday, which centred around four pillars: economic capital, natural capital, social capital and human capital. It called, amongst other things, for young people to be guaranteed a job for two years, for more autonomy for the Scottish Government to decide how funds are spent during the economic recovery and for increased investment in digital infrastructure. You can read the full report here.

Columns of note

Daniel French warns in the Spectator of the emergence of ‘underground’, or more likely online, churches to challenge cancel culture, “trendy vicars” and progressive theologians for whom SWOT analyses and mission statements are more important than their worshippers. It’s an interesting insight into how this crisis has impacted the internal politics of the Church of England. (£)
 
Writing in The Atlantic, James Hamblin thinks you are washing too much. Our understanding of what it means to be ‘clean’ has evolved over time – from “basic hygiene practices to elaborate rituals” involving a slew of products targeted at different areas, skin types, genders. At the same time, skin conditions such as eczema and psoriasis are on the up in the developed world, and acne is as pernicious as ever.

Cartoon source: Evening Standard

Markets

What happened yesterday?

European indices ended in the red yesterday as traders feared for a second wave of coronavirus infections, particularly in the Americas, China, India and Germany. The FTSE 100 closed 0.72% lower, while the FTSE 250 shed 0.64% to finish the day at 17,573.44.
 
In company news:
 
German payments group Wirecard acknowledged for the first time yesterday the potential scale of a multiyear accounting fraud, revealing that €1.9bn of cash on its balance sheet probably does “not exist”.
 
UK technology company UKFast has hired a former senior manager at Booking.com, Ian Brown, as its new chief executive, following a Financial Times investigation into allegations of sexual assault and inappropriate behaviour by former boss Lawrence Jones. (£)
 
Cineworld announced yesterday that it has secured a $250m debt facility from a group of private institutional investors as it gears up to reopen theatres following the easing of coronavirus lockdowns globally.
 
Aston Martin has appointed former Jaguar Land Rover executive Kenneth Gregor as its chief financial officer, in the first of a number of appointments expected by the luxury carmaker’s new owner Lawrence Stroll.
 
UK financial technology group Checkout.com has become one of the most highly valued start-ups in Europe after nearly tripling its valuation to $5.5bn. (£)

What’s happening today?

Finals
Cranswick
Gear4music
Naked Wine
Scapa
Trackwise Desi.

Interims
Tricorn
Velocity Comp

Trading announcements
NCC

AGMs
Anglo Asian
Ceps
Cora Gold
Epe Special Opp
Golden Pros
Henderson High Income Trust
Hill & Smuth
Int Diag Hld
Merchants Trust
Microsaic
North Atl.smlr
Oxford Biomedica
Panther Securities
Lukoil Adr
Smart Metering
Us Solar Fund

UK economic announcements
(11:00) CBI Industrial Trends Surveys

Int. economic announcements
(15:00) U. of Michigan Confidence (US)
(15:00) New Homes Sales (US)

Source: Financial Times

did you know

“Huh” appears to be a universal word for expressing confusion – it’s the same in English, Dutch, Icelandic, Lao, Russian and Mandarin Chinese.

Parliamentary highlights

House of Commons

Oral questions
Health and Social Care (including Topical Questions)
 
Ministerial statement
Covid-19 update – Boris Johnson
 
Windrush – Priti Patel
 
Ten minute rule motion
Desecration of War Memorials – Jonathan Gullis
 
Legislation
Medicines and Medical Devices Bill: Remaining Stages
 
Motions
Establishment of an independent expert panel to consider cases raised under the Independent Complaints and Grievance Scheme – Jacob Rees-Mogg

House of Lords
Oral questions
Reducing the amount of illegal fly-tipping, particularly in rural areas – Lord Trefgarne

Progress on implementing the action points since the most recent London Commonwealth Heads of Government Meeting – Lord Collins of Highbury

Reducing the number of introductions of new Peers – Lord Balfe

Consultations with education and health professionals about plans to facilitate the safe return of students to schools as soon as possible – Lord Randall of Uxbridge

Legislation
Corporate Insolvency and Governance Bill – Report stage and Third reading – Lord Callanan

Statement
Reading Terrorist Attack – Baroness Williams of Trafford

Scottish Parliament 
Topical questions
 
Scottish government debate
Local government finance (Scotland) (Coronavirus) amendment order 2020
 
Advisory Group on Economic Recovery recommendations
 
Stage three proceedings
Civil Partnership (Scotland) Bill
 
Committee announcements
Environment, climate change and land reform committee: report on legislative consent memorandum on the UK Environment Bill

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