13th Jul 2020 11:00
(Alliance News) - The following is a summary of top news stories Tuesday.
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COMPANIES
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The chief executive of BT Group has warned that it would be "impossible" to strip Huawei products out of the UK's telecommunications network within the next decade. He also warned of "outages" and possible security risks if the sector was told to curtail all business with the Chinese technology giant during the building of the 5G network upgrade. It follows suggestions a decision is due to be made public by UK Culture Secretary Oliver Dowden on Tuesday over the future of Huawei in the UK. Dowden, speaking last week, said that US sanctions on Huawei were likely to have a "significant impact" on the firm's ability to play a role in the UK's 5G network. BT CEO Philip Jansen told BBC Radio 4's Today programme: "Huawei has been in the telecoms infrastructure for about 20 years and a big supplier to BT and many others in the UK telecoms industry. "It is all about timing and balance. So if you want to have no Huawei in the whole of the telecoms infrastructure across the whole of the UK, I think that's impossible to do in under 10 years."
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Pub chain JD Wetherspoon is to reduce prices on meals and drinks following the decision to cut value-added tax on food, coffee and soft drinks, and has produced posters praising the UK Chancellor of the Exchequer Rishi Sunak. Messages including Sunak's Specials and Dishi Rishi will be displayed alongside details of lower prices on some drinks and food following the UK government decision, announced Chancellor Rishi Sunak last week, to reduce VAT from 20% to 5%. Wetherspoon said it will fully pass on the tax cut to its customers from Wednesday, including real ale, coffee, soft drinks, breakfasts and other food.
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Aberdeen Standard Investments has sold most of its shareholding in online clothing retailer Boohoo Group over allegations of poor working conditions in its supply chain, the Times reported late Friday. According to the newspaper, the asset manager has sold 27 million shares, equivalent to two-thirds of its stake. The Sunday Times previously had reported allegations that workers in Leicester's Jaswal Fashions factory making clothes for Boohoo brand Nasty Gal were being paid as little as GBP3.50 an hour and operating without social distancing measures in place. Boohoo, in response, on Wednesday last week had distanced itself from Jaswal Fashions and had said that while it has seen "non-compliance" with its code of conduct, it has not seen evidence of its suppliers paying workers GBP3.50 per hour. It also had launched an independent review of its UK supply chain. "Having spoken to Boohoo's management team a number of times this week in light of recent concerning allegations, we view their response as inadequate in scope, timeliness and gravity," Lesley Duncan, deputy head of UK Equities at Aberdeen Standard Investments, told the Times.
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Boohoo peer Quiz said it is investigating a Leicester-based supplier which is alleged to have paid staff as little as GBP3 an hour. The Times on Saturday reported that an undercover journalist was told by bosses at the factory that she must perform two days of unpaid work before even advancing to the GBP3 per hour rate. The fashion brand said it believes that one of its Leicester-based suppliers has used a subcontractor at the centre of allegations over breaches to the UK National Living Wage.
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MARKETS
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London shares started the week on the front foot after an upbeat Asian session on hopes of a coronavirus vaccine. The pound was down against the dollar as Brexit negotiations come back into focus. Wall Street was set for a higher open as earnings season gets underway, with second-quarter results due from soft drinks maker PepsiCo.
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FTSE 100: up 1.0% at 6,156.90
FTSE 250: up 0.9% at 17,329.55
AIM ALL-SHARE: down 0.3% at 879.53
GBP: down at USD1.2597 (USD1.2661)
EUR: unchanged at USD1.1317
GOLD: up at USD1,808.88 per ounce (USD1,801.62)
OIL (Brent): down at USD42.35 a barrel (USD42.72)
(changes since previous London equities close)
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ECONOMICS AND GENERAL
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The World Health Organization has urged countries grappling with coronavirus to step up control measures, saying it is still possible to rein it in, as some nations clamp fresh restrictions on citizens. With case numbers worldwide more than doubling in the past six weeks, Uzbekistan on Friday returned to lockdown and Hong Kong said schools would close from Monday after the city recorded "exponential growth" in locally transmitted infections. The US, the country hardest hit by the coronavirus pandemic, on Sunday recorded 59,747 new cases over the last 24-hour period, according to a tally from Johns Hopkins University. The number of cases in the US has rocketed in recent weeks, hitting a record of 66,528 in 24 hours on Saturday. Florida has shattered the US record for the largest single-day increase in positive coronavirus cases in any state since the beginning of the pandemic. It added more than 15,000 cases to its total as the daily average death toll also continued to rise.
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Britain on Sunday pledged GBP705 million to prepare its borders for cutting ties with the EU on December 31, amid concern within the government that it is not ready. The money will fund new border posts, IT systems and 500 new staff to both ensure security and handle new customs controls after Britain leaves the EU's single market and customs union, the government said in a statement. Britain ended its EU membership on January 31, almost four years after the historic Brexit vote, but agreed a standstill transition period until the end of the year while it tries to negotiate a new trade deal with Brussels. The talks are moving slowly, sparking alarm among businesses that almost half a century of economic integration with the EU will end abruptly in a few months' time. Citing the disruption caused by the coronavirus outbreak, London has already said it will not immediately introduce checks on EU imports, instead delaying them until July.
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Beauty salons, nail bars and tattoo shops are to open for the first time in four months as part of the latest relaxation of lockdown restrictions in England. Spas, massage studios and physical therapy businesses will also be able to welcome customers again on Monday. But businesses will be required to meet coronavirus guidelines, and restrictions on treatments which involve work directly in front of the face will not be available. Government guidance states that face waxing, eyelash treatments, make-up application and facials should not be provided because of the greater risk of Covid-19 transmission. The relaxation comes as around 200 workers at a farm in Herefordshire were quarantined following an outbreak of coronavirus.
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About 10,000 Hong Kong passport holders currently in Australia will be offered the chance to apply for permanent residence as concerns continue over China's imposition of a national security law. Australian Prime Minister Scott Morrison on Thursday said his country had suspended its extradition treaty with Hong Kong and extended visas for the territory's residents. An Australian immigration minister, Alan Tudge, said in an interview on Sunday that Hongkongers in Australia would be able to apply for permanent residence once their current visas expired. Tudge told the Australian Broadcasting Corporation that applicants would have to pass character and security tests before gaining permanent residency. He said: "So it's not automatic. But it's certainly an easier pathway to permanent residency and of course once you're a permanent resident, there's then a pathway to citizenship there."
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China returned to growth in the second quarter after the coronavirus pandemic handed the world's second-largest economy its first contraction in decades, according to an AFP poll of analysts. The survey of analysts from 11 institutions pegged China's growth at 1.3% - a far cry from the 6.1% expansion posted last year but in better shape than other countries still grappling with the contagion. The coronavirus, which first emerged in China's industrial central province of Hubei late last year, has shut businesses worldwide and destroyed hundreds of millions of jobs. But analysts forecast China will be the only major economy to experience positive growth this year - partly because it was first to be hit by Covid-19 and therefore first to recover. China is expected to post 1.7% growth for the full year, according to the economists surveyed by AFP, compared with IMF forecasts of a global contraction.
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