With just over 50 days to go until Brexit, you’d think the UK, Parliament and Boris Johnson would have an inkling into what is going to happen. But it seems they’re all in the same situation they were seven or so months ago in the build up to the first deadline in March – and uncertainty is as rife as ever. Here’s a recap of what unfolded in the House of Commons and the week’s other top stories.
Is there a more fitting term to use to describe Brexit than chaotic? Shambolic? Discombobulated perhaps? After Boris’ bold Brexit move last week, it was up to the House of Commons this week as they voted on having an early general election and a bill that looked to avoid a no-deal Brexit.
Boris effectively lost in both votes, with MPs siding against calling an early general election and also voted for a bill that would effectively make a no-deal Brexit illegal. To make matters worse, his own brother and member of his cabinet, Jo Johnson, quit after being stuck in an ‘unresolvable tension’ and being ‘torn between family and loyalty.’
So, all this means that the most likely outcome is another extension, meaning Brexit could drag on well into 2020. Johnson has remained stout though, claiming he’d ‘rather be dead in a ditch’ than not leave the EU on 31 October.
As we’ve established previously, the pound seems hooked on the political situation in the UK. With Johnson intent on making the UK leave the EU in October, the pound had been suffering at the hands of the euro and especially the dollar. But the MPs’ block on no deal saw sterling rally as optimism rose.
It will be interesting going forward (if Brexit is again delayed) whether a delay will be seen as a positive for the pound or not. On the one hand, it means it will be subjected to further turmoil at the hands of Brexit, but on the other hand an extension would be a better scenario than a no-deal Brexit.
After years of adverts on TV, some people still aren’t entirely sure whether PPI is a scam or not. For the record, it’s not, but the sound of being able to claim back large sums of money that you’re actually owed does sound too good to be true.
A lot of people’s curiosity was peaked, though, as the 29 August deadline approached. Banks are said to have been affected to the tune of £53 billion. CYBG said that in five weeks it had over 340,000 claims and shares fell to all-time lows. It was a similar story across the industry and could be one to watch as more figures are released regarding the exact damage PPI repayments have had on banks.
One of the latest TV adverts encouraging viewers to make a PPI repayment claim.
In football terms, M&S has been relegated. It’s spent many decades in the top tier but this month succumbed to the pressure of those below, and dropped down from the FTSE 100 into the FTSE 250.
Why did this happen? One of Britain’s oldest retailers has been struggling for a while now. Fierce online competition and an increase in costs has been attributed to the falling share price. It means the illustrious club of 28 firms that have been in the FTSE 100 since its inception in 1984 becomes 27.
Marks & Spencer’s share price is currently around the £1.95 level. It saw an increase when the news was announced this week. Perhaps it drew attention to what investors saw as a cheap share price for a company with such prestige and history as that of M&S.
Dow up under trade war optimism
Wall Street was up over 400 points on Thursday as optimism rose for a resumption of trade talks between the US and China regarding the trade war. A ‘tentative’ date of early October has been set for talks to recommence.
The news came as the Chinese Ministry of Commerce released a statement declaring the date had been set after a successful conference call between Vice Premier, Liu He, and the trade representative for the US, Robert Lighthizer. Trump’s Twitter was for once not involved, but anything to do with the trade war will be a key driver of the Dow and other US indices.
William Hill boss departs
Finally, in a week that saw Jo Johnson leave the Cabinet and M&S leave the FTSE 100, the hattrick was completed as William Hill’s chief executive, Philip Bowcock, left the struggling firm.
A tightening of regulations throughout the gambling industry, including further restrictions to what and when adverts can be broadcasted, and the highly covered FOBT machines’ maximum stake being limited to just £2 (down from £100) has impacted all the high-street betting companies in the UK. Bowcock himself described the industry as going through an ’intense period.’
The news caused minor disruption and short-term volatility to William Hill’s share price, but it has since resided to levels that it saw previously – around £1.80.