Netflix, the streaming giant behind hits like The Crown and Stranger Things, missed its own forecasts by more than a million subscribers, sending its shares down sharply. The company second-quarter results, announced on Monday, spooked investors and suggested the company’s explosive subscriber growth may now be slowing. Netflix shares fell 14% to $346. 05 in after-hours trading in New York. For the second quarter, Netflix reported a profit of $384. 3m, or 85 cents a share, up from $65.
Justine Greening became the most high profile Conservative to endorse the idea of a second referendum, to end what she said would be a likely parliamentary deadlock over Brexit, warning that Theresa May’s Chequers plan did not represent “a workable compromise” that a majority of MPs could get behind. The former education secretary and remain supporter said that May’s plan was “a fudge I can’t support” and, in a blow to the prime minister, said it amounted to “the worst of both worlds” – complying with EU rules without the influence of being a member of the multi-country bloc.
1600: US equity markets are mixed as banks kick-off earnings season, with numbers from JP Morgan,. Well Fargo and Citi. Traders booked some of their profits on US stocks after they had a strong finish yesterday. The trade spat with China is still bubbling away in the background, and remains at the forefront of traders’ minds.
President Trump has savaged Theresa May’s Brexit plan, saying that it would almost certainly kill a trade deal between Britain and the United States. He suggested that the prime minister’s proposal was a betrayal of those who voted to leave the European Union and said that Boris Johnson would make a great prime minister. - The Times.
1352: UK manufacturers’ trade body, the EEF, likes the look of the white paper, so does the Institute of Directors, mostly, calling for more clarity on VAT and a business dispute resolution mechanism to be proposed.
Plans for a tight new relationship with the European Union in financial services after Brexit will not be included in the government’s long-awaited white paper to be published today. Instead the new approach to the City’s relationship with Brussels, which will mean less access to the European market for UK-based financial service groups, has been described as “cohabiting but without the same commitment as marriage”. - The Times.
1614: Governor Carney to begin speaking at 1635 BST.
The chairman of Marks & Spencer has given his starkest warning yet about existential threat faced by the high street giant as he refused to rule out further store closures and job losses. This business is on a burning platform,” said Archie Norman, who took over as M&S’s chairman last year. “We don’t have a God-given right to exist and unless we change and develop this company the way we want to, in decades to come there will be no M&S. ” – Guardian.
Britain’s retailers are benefiting from England’s continuing World Cup run and the warm weather boosting beer, barbecue and big-screen TV sales, despite the severe underlying challenges facing the high street. Suggesting deep problems remain for retailers as they close hundreds of stores across the country, the British Retail Consortium (BRC) and KPMG said World Cup fever sweeping the nation along with a heatwave helped paper over the cracks for the industry in June.
The competition watchdog has challenged the accounting profession to find ways to improve choice in the auditing market that could save the Big Four firms from being broken up. Andrea Coscelli, chief executive of the Competition and Markets Authority, issued the challenge in meetings with the biggest accountants. It signals a reluctance from the regulator to force accountants to spin off their audit practices after they called the idea “unworkable”. - The Times.
Theresa May’s desperate attempts to unite her party and country behind a new Brexit blueprint are under severe strain, as more than 100 entrepreneurs and founders of UK businesses dismissed it as unworkable – and hardline anti-EU Conservative MPs warned it could mean an outcome worse than “no deal” at all. There were also signs that Brussels was less than impressed after an initial examination of the plans, which were thrashed out and agreed by the entire cabinet at an all-day summit at Chequers on Friday.
A long-threatened trade war between the US and China got underway on Friday as the US imposed tariffs on $34bn in Chinese goods. China has promised to levy its own tariffs immediately after on a similar quantity of US imports. Minutes after the US tariffs went into effect at 12:01 Friday US time (0401 GMT), a spokesperson for China’s ministry of commerce said, “China promised not to fire the first shot, but in order to safeguard the country’s core interests as well as that of the people, it is forced to fight back”.
Rising trade tensions threaten to derail global economic growth and signs of a slowdown have started to emerge, the World Trade Organisation has warned. Nations were urged to “show restraint” amid heightened fears of a full-blown trade war between the United States and other countries. President Trump is set to impose tariffs on $34 billion of Chinese products tomorrow. The government in Beijing is expected to strike back with retaliatory duties within hours.
1435: AIM-listed fashion e-retailer Koovs is shooting higher after an investment from one of India's biggest retail groups.
The crisis on UK high streets could leave 100,000 shops empty within a decade, according to an independent review that argues struggling retailers should no longer be relied upon to prop up ailing town centres. The Grimsey Review 2 makes a series of recommendations including an overhaul of the business rates system and a ban on out-of-town developments. It predicts nearly 70,000 high street jobs will disappear this year. – Guardian.
1456: JPMorgan Cazenove analysts have highlighted favourite SMID investment opportunities, including Arrow Global, Cineworld, Gulf Marine Services and Vectura.
The government is close to lifting its eight-year long freeze on fuel duty to raise billions of pounds to help meet pressure from cabinet ministers to boost public spending while also continuing to reduce the deficit. An inflation-linked increase would raise £800m extra for Treasury coffers next year – and billions more over subsequent years – to help pay for Theresa May’s promise to spend an additional £20bn on the National Health Service by 2023, a pledge which the prime minister had said would partly be funded through a “Brexit dividend”.
1542: In a note on the CFTC Commitment of Traders report, Rabobank notes that currency speculators' GBP shorts grew further last week after plunging into negative territory in the middle of June, after the hawkish leaning from BoE chief economist Andy Haldane and amid UK political risk over Brexit policy.
The business secretary, Greg Clark, has suggested the post-Brexit transition period could be extended to allow companies more time to prepare, as he criticised cabinet colleagues for airing their differences in public. With Theresa May’s bitterly divided cabinet preparing for a showdown at Chequers on Friday over Britain’s future relationship with the EU, Clark urged ministers to listen to business – and be guided by evidence. - Guardian.
A cocktail of risks is stirring in the global economy that could be damaging for Brexit-bound Britain, according to Sir Jon Cunliffe, a Bank of England deputy governor. Escalating trade wars, strains in emerging markets and a rising possibility of a Chinese credit crisis could combine into a “painful” experience for the British economy. - Sunday Times.