Good morning! Here’s what you need to know in markets on Monday.
1. BT has been hit with a record £42 million fine by the telecoms regulator Ofcom and has agreed to pay £300 million to its rivals over the use of a loophole that artificially reduced the amount it compensated companies including Vodafone when it failed to connect a line in time. The Financial Times reports that the scale of the fine and the refund to its rivals, which rely on BT’s networking division Openreach to connect lines, is unprecedented in UK telecoms.
2. Asian stocks started the week on a cautious note as President Donald Trump’s stunning failure to get health care reform passed raised concerns about the prospects for his plans to use fiscal stimulus to boost economic growth. Japan’s Nikkei is down 1.57% at the time of writing (6.22 a.m. GMT/1.22 a.m. ET), the Hong Kong Hang Seng is down 0.21%, but China’s Shanghai Composite is up 0.09%.
3. easyJet will announce within weeks the location of a new European base as Britain’s airline industry grapples with the potential consequences of a “hard Brexit.” Sky News understands that the low-cost carrier’s board has pencilled in an April decision on the location of a new air operator’s certificate (AOC), which will allow it to continue flying between EU member states.
4. Investments giant Old Mutual is selling a $US446 million (£358 million) stake in its asset management arm in the latest stage of its plan to split itself up into four independent companies. The Telegraph reports that the FTSE 100 finance firm is cutting its stake in OM Asset Management in half, losing its majority position by selling down from a 50.8% shareholding to 25.9%.
5. Tesco is in advanced talks about a deal with prosecutors that would involve it paying a huge fine over the 2014 financial reporting scandal that saw it exaggerate its profits by more than £300 million. Sky News has learnt that lawyers acting for Britain’s biggest retailer are closing in on a deferred prosecution agreement (DPA) following months of discussions with the Serious Fraud Office (SFO).
6. Sir James Dyson, the billionaire investor, has played down concerns that a “hard Brexit” could harm the UK economy by claiming that World Trade Organisation tariffs have not prevented his technology company from achieving record financial results. The Guardian reports that sales at the vacuum cleaner manufacturer rose 45% year-on-year to £2.5 billion for 2016 while underlying profits rose 41% to £631 million.
7. Qatar said it will announce major new investments in the UK this week, deepening the countries’ trade ties as London prepares to quit the European Union. Bloomberg reports that the emirate’s prime minister, Sheikh Abdullah bin Nasser bin Khalifa Al-Thani, is leading a delegation of more than 400 officials and business executives to London and Birmingham to a two-day meeting with UK counterparts, according to government statements.
8. The fight against terrorism makes the encryption of messages on services such as Facebook-owned internet messaging service WhatsApp “completely unacceptable,” according to Home Secretary Amber Rudd. She told BBC’s Andrew Marr Show on Sunday that “there should be no place for terrorists to hide.”
9. Westinghouse Electric, the US nuclear unit of Japan’s Toshiba, could file for bankruptcy protection as early as Tuesday and is seeking support from South Korea’s Korea Electric Power, the Nikkei said on Monday. A Chapter 11 filing could help Toshiba limit damage from losses at Westinghouse, the report by the Japanese business daily said, without citing sources for its information.
10. There’s a civil war in the bitcoin community over the digital currency’s future. Developers, miners, and other stakeholders are locked in a heated debate over how best to scale the network, with chances steadily rising of irreconcilable differences causing a so-called “hard fork” that would split Bitcoin in two.
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