Good morning! Here’s what you need to know in markets on Monday.
1. London remains the globe’s most attractive financial centre, extending its lead over New York despite Britain’s looming departure from the European Union, a survey found on Monday. Britain’s departure from the trading bloc has led to some politicians and economists predicting London will lose its pre-eminent status as a financial centre, but there are few signs of that happening yet.
2. Goldman Sachs is looking to expand its retail banking business to the UK, replicating its mass-market offering in the US, as it continues a steady march from Wall Street to Main Street. The Financial Times reports that the New York-based investment bank began to pivot in the US about 18 months ago, offering high-interest online savings accounts for a deposit of as little as $US1.
3. The introduction of post-Brexit customs checks could cost traders more than £4 billion a year, according to a think tank report released on Monday. The British government has said it plans to leave the European Union’s customs union when it leaves the bloc, and it wants to negotiate a new relationship that will ensure trade is as free of friction as possible, Reuters reports.
4. Lloyd’s of London is braced to absorb an estimated $US200 billion (£151.7 billion) of losses from Hurricane Irma, its predecessor Harvey and the forthcoming Jose, with enough reinsurance to divert the bulk of expected claims from underwriters. However, experts say that if sufficient new finance that has flooded into the reinsurance market takes fright and pulls out again, rates across the sector eventually could start to rise — and not merely for those exposed to extreme weather risk, the Times reports.
5. Japan’s Nikkei rallied to a one-week high on Monday morning after the dollar recovered against the yen, lifting recently battered exporters and financial stocks which had stumbled amid the simmering tensions on the Korean peninsula. The Nikkei index is up 1.39% at the time of writing (6.22 a.m. BST/1.22 a.m. ET). Elsewhere in Asia, China’s Shanghai Composite is up 0.04% and the Hong Kong Hang Seng is up 0.92% at the same time.
6. The Middle East arm of public relations firm Bell Pottinger is in talks to separate from its British parent that is expected to go into administration this week, the unit said in a statement on Sunday. Reuters reports that Bell Pottinger, until recently one of the world’s largest PR agencies, put itself up for sale after running a racially charged campaign in South Africa which has led to it being shunned by its peers.
7. The City’s top lobby group is urging the Government to make sure any laws introduced post-Brexit do not dent demand for Islamic finance as inquiries from banks to set up Shariah-compliant services soar. The Telegraph reports that TheCityUK, which represents Britain’s banks and financial institutions, has sent a 32-page report to the UK Government highlighting that assets of UK firms offering Islamic finance services surpassed $US5 billion (£3.8 billion) in 2016, up 11% in two years.
8. There’s a real risk Uber won’t be allowed to operate in London, with the city’s transport authorities spooked by the firm’s history of poor behaviour. Three board members at London’s transport regulator, Transport for London, want Uber’s operator licence cancelled, or renewed only with strict conditions, according to The Sunday Times.
9. Estonian ride-hailing startup Taxify has slammed London’s transport regulator as “the most hostile regulatory body we have ever encountered”, and said it had appealed the loss of its licence. Taxify launched on Tuesday as a cheaper alternative to Uber in London, but had to suspend its services on Friday after Transport for London said it was “urgently investigating” the company and revoked its licence.
10. CBS Corp will pay at least A$201.1 million (£122.9 million, $US162 million) in cash to buy Australian broadcaster Ten Network Holdings, according to documents released on Monday by Ten’s administrator. CBS, the United States’ most-watched television network, said it agreed to buy Ten last month, but neither party disclosed a price tag at the time. The beleaguered broadcaster was placed in administration in June.