Following on from what we mentioned yesterday, Samsung has now dramatically cut their quarterly profit estimates after scrapping production of the Note 7. Their Q3 profit estimates have dropped by a third on top of the $20bn wiped off their market value. Samsung now regretting telling the design team they wanted it to be the hottest phone in the world. The literal and figurative battle continues.
Troubled UK airline Monarch has agreed a £165m investment (lifeline) from Greybull Capital. This will enable investment in new aircraft and has allowed the airline to renew its membership to the Atol scheme, which basically refunds customers should, the firm collapse.
Lloyds Banking Group has announced they will cut over 1,200 jobs as part of their continuing restructure plan. 2 years ago the Group announced it would slash 9,000 jobs in order to reduce costs and boost shareholder returns. Shares finished the day down –1.14%. And for those interested, Ericsson shares dropped in Sweden after their profit expectations fell by 94% compared to the same time last year.
After the relentless battering of the pound lately, the currency enjoyed a rare moment of relief today after Theresa May agreed to let MPs vote on her Brexit terms. Early this morning the pound bounced back by around 1.6% against the dollar. The debate is not to undermine the vote but ‘may’ provide a ‘softer’ Brexit platform as generally investors seeing this as a more market-friendly move. Bank of England (BoE) policymaker Michael Saunders commented on Tuesday that leaving the EU may prompt faster wage growth and inflation as the availability of foreign workers has decreased. He also warned he wouldn’t be surprised if sterling fell yet further, without doubt currency risk is here to stay.
The markets translated this news negatively to bring both the FTSE 100 and 250 down. The main index lost 0.66% after Tuesday’s highs and the 250 closed down 0.65%. The pound itself at the time of writing sat lower both against the dollar and euro however. Elsewhere Asian indices generally closed lower on Wednesday, after a sharp decline on Wall Street from Tuesday, as we write American markets are generally trading flat, awaiting September FOMC minutes to be released at 7pm tonight.