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Live Reporting

By Jill Treanor and Simon Read

All times stated are UK

  1. Thomas Cook rescue 'poor decision' for taxpayer

    thomas cook staff

    The Business Energy and Industry Strategy Committee has also published a number of documents that have been submitted as part of its inquiry into the collapse of Thomas Cook.

    There is a letter from Andrea Leadsom, in which she says says government "rescue deal would have been a very poor decision for the taxpayer".

    She said it was "too early at this stage to give a clear summary of total costs, as the liquidation process is yet to be concluded".

    "By way of indicative costs, the repatriation of Thomas Cook customers is expected to be about double the cost of the Monarch repatriation operation in 2017, which was about £40m.

    "The majority of Thomas Cook passengers were Air Travel Organiser’s Licence (ATOL) protected and the costs for repatriating those passengers have been covered by the ATOL scheme.

    "The Official Receiver’s costs for the first three weeks of the liquidation amount to approximately £21m. This includes salaries for employees retained to assist with the repatriation and the liquidation, fees for the Special Managers and legal advice. As the liquidation is on-going, the costs will rise; we will only be able to provide a total, substantiated figure once the process is concluded."

  2. Thomas Cook inquiry cut short by election

    Thomas Cook with people stood outside

    MPs on the Business, Energy and Industry Strategy Committee, have written to Andrea Leadsom, the business secretary, to outline recommendations in the wake of the collapse of Thomas Cook.

    The committee has been holding an inquiry into the collapse of the tour operator, taking evidence from former bosses including Peter Fankhauser, Manny Fontenla-Novoa and Harriet Green.

    It suggests strengthening of clawback of bonuses so that are “provisions on clawback need to be strengthened and the scope of clawbacks extended”

    It also adds that the government should seek “a binding commitment from lenders that those who have lost their jobs as a result of a corporate liquidation can benefit from a loan payment holiday or mortgage payment holiday”.

    Rachel Reeves, the Labour MP who chairs the committee, said: “Our inquiry has been cut short by the election but it’s clear that a series of misjudgements at Thomas Cook led to its collapse. The piling up of debt, confused business plans, lack of challenge in the board room and by auditors, and aggressive accounting practices all contributed to the failure of the business.

    “During our inquiry, we’ve witnessed buck-passing and blame-shifting but precious little humility or reflection from those at the top of the business".

  3. Advice for worried Mothercare workers

    Mothercare branch

    The Money and Pensions Service is offering help to Mothercare workers worried about pay and financial security.

    “If anyone has queries or concerns about how to handle mortgages, debts or other money worries, then the Money and Pensions Service is here to help," said Caroline Siarkiewicz, acting chief executive of the government-sponsored body.

    "Our Money Advice Service website has tips on managing money if your job is at risk and our specialists on 0800 138 7777 will be able to answer questions about redundancy rights and help you find the right place to get answers about pensions.”

  4. Under Armour faces US accounting probe

    Under Armour logo

    Ahead of the US market open, one stock to watch is sportswear maker Under Armour which is under investigation by US authorities over its accounting practices.

    The probe, first reported by the Wall Street Journal, is said to examine whether the firm moved sales from quarter to quarter to boost the appearance of its finances.

    An Under Armour spokesperson said that in July 2017, the company began responding to "requests for documents and information relating primarily to its accounting practices and related disclosures, and the company firmly believes that its accounting practices and disclosures were appropriate".

    The company is due to report third quarter results later.

  5. London market movers

    London stock exchange logo

    As mentioned earlier, the gambling stocks are dominating the fallers in the FTSE 250, where the gainers are led by oil services company Wood Group and Pets at Home.

    In the FTSE 100 index, the biggest gainers are the mining companies - the likes of Glencore and BHP Billiton - and NMC Health.

    Woodford Patient Capital Trust is down 7% after the latest writedown of one of its investments, Industrial Heat.

  6. FTSE 100 up 1%

    The FTSE 100 index is up more than 1% - or 81.24 points - at 7,383.66.

    The FTSE 250 is up 0.39% at 20,238.16, that's 79.39 higher.

    The pound is down a little, at $1.2924.

  7. Woodford fund slashes value of Brad Pitt-backed cold fusion firm

    Brad Pitt

    A fund formerly run by crisis-hit Neil Woodford has slashed the value of its stake in a Brad Pitt-backed nuclear energy company.

    Woodford Patient Capital Trust cut the valuation of its holding in Industrial Heat, an unproved cold fusion venture, by £45m.

    It is the second time that Mr Woodford's former fund has written down Industrial Heat, which plans to develop a controversial and unproven nuclear technology.

    The fund took a £30m writedown on the company in August.

    The Woodford funds own around a quarter of Industrial Heat, which was once valued at nearly $1bn (£774m).

  8. Betting shares fall on risk to online casinos

    cards

    Shares in all the main gambling companies are down sharply.

    GVC, which earlier named a new chairman, is off 12% while William Hill has fallen 7%, 888 is down 5% and Flutter (Paddy Power) is off 2%.

    Neil Wilson, chief market analyst at markets.com, points to the all-parliamentary party group report - written up by the Guardian - which says online casinos should be subject to maximum stake limits similar to the £2 limits imposed on fixed-odds betting terminals (FOBTs).

    "If any future government carried out these reforms it would be a big blow to bookmakers who now derive a lot of revenues from online gaming. It could be as bad for them as the FOBT restrictions," he said.

  9. Ryanair calls for IAG competition probe

    Michael O'Leary
    Image caption: Michael O'Leary

    Ryanair said it will ask competition authorities to force British Airways owner IAG to make divestments as part of its purchase of Air Europa.

    Chief executive Michael O'Leary said: "I think it is a good deal for IAG, for Willie Walsh. I think it is a bad deal from a competition point of view.

    "It is a merger to monopoly in Madrid and I think we would certainly be looking for the competition authorities to require some competition divestments, particularly in the Air Europa short-haul," he told analysts on Monday.

  10. IAG faces possible competition woes

    Air Europa plane

    As mentioned earlier, British Airways and Iberia owner IAG has announced the €1bn take over of Spanish airline Air Europa.

    Gerald Khoo, analyst at Liberum, sees "strong commercial logic" for the deal.

    "The deal would strengthen Iberia’s position at its Madrid hub and give IAG clear leadership in the Europe to Latin America market. In the case of the latter, IAG estimates its market share would rise from 19% (currently tied with Air France-KLM) to 26%," he said.

    But, he notes that clearance by the competition authorities is more than a formality.

    "[IAG's] management has indicated that the main authorities will be those of the US, the EU and Brazil. We do not see these clearances as a formality.

    "We believe that the EU may be minded to focus on EU-level market share, and while the combined slot share at Madrid is likely to still fall short of that of the other majors groups at their respective hubs, clearance may not be straightforward.

    "Potential remedies, perhaps in the form of slot release or behavioural restrictions, may be required and these could impact the potential synergies".

    He added there is also a possibility that potential partners could buy the businesses IAG could not do.

  11. KPMG 'to axe a tenth of partners'

    KPMG logo

    On its front page, the Financial Times is reporting that KPMG will axe a tenth of its UK partners by Christmas following a review of individual performance.

    The one-off cut-back comes as the accountant dramatically scales back its costs and restructures its operating model as it tries to recover from a reputational crisis and prepare for regulatory changes to the accounting sector.

    The paper says that Bill Michael, chairman of KPMG, told partners at a recent “roadshow” that the firm would take a harsher approach to managing performance, said a person familiar with the matter.

    KPMG would expect roughly 45 partners to leave the firm, either through natural or forced retirement, the the paper said, but that number is 65 this year.

  12. Aramco's 18% income drop is in line with rivals

    Oil refinery

    That $15bn (£11.6bn) fall in income for Saudi Aramco in the last nine months is no real surprise.

    The figures are in line with those of other major oil companies.

    In the last week a sustained decline in oil prices has knocked the third quarter earnings of firms including Exxon Mobil, BP and Royal Dutch Shell.

    BP’s profits alone slipped $749m in the quarter.

  13. Mothercare shows 'current turbulence of the high street'

    Commenting on that Mothercare administration news, Julie Palmer, partner at Begbies Traynor, said:

    Quote Message: Mothercare has become a byword for trouble on the high street, and today’s news will not be surprising to many following the company’s longstanding financial issues. With 2,500 jobs now at risk, this once again demonstrates the current turbulence of the high street and the failure of well-established brands to stay afloat. Other retailers, particularly those who have also previously filed for CVAs, will be concerned that these restructuring plans haven’t succeeded and a more radical approach may be required in order to survive.
  14. Mothercare 'crucified themselves'

    Retail analyst Steve Dresser tweets:

    View more on twitter

    As mentioned earlier, Mothercare employs 2,500 in the UK, some 2,000 of which are part-time.

  15. Fracking shares slump after Government action

    Anti-fracking campaigners
    Image caption: Anti-fracking campaigners

    Shares in firms linked to fracking in Britain have slumped this morning after the UK government halted shale gas extraction over earthquake fears.

    The indefinite suspension cam after a report by the Oil and Gas Authority said it was not possible to predict the probability or size of tremors caused by the practice.

    Shares in AJ Lucas, the Australian energy services group that owns 48% of UK fracking company Cuadrilla, closed down 23% on the Australian Stock Exchange.

    IGas, which had been hoping to follow Cuadrilla into fracking, fell more than 25% in early trading before recovering slightly. It's currently down 14% on the day.

  16. Construction sector should revive

    workers

    Samuel Tombs, chief UK economist at Pantheon Macroeconomics, says the PMI survey suggests the "construction sector is mired in recession, although 2020 should be a much better year".

    He says the survey is consistent with construction output falling at 2% quarter-on-quarter in in both the third and fourth quarters. That's after a 1.3% decline in the second quarter.

  17. UK construction industry shrinks again

    Chief Business Economist at IHS Markit tweets

    View more on twitter

    The PMI indicators for the UK have been published, following those ones on manufacturing for the eurozone mentioned earlier.

    The IHS Markit/CIPS construction PMI rose to 44.2 in October from 43.3 in September but showed that activity shrank for the sixth consecutive month. Any reading below 50 is a contraction.

    UK construction companies experienced a downturn in business performance during October as political uncertainty and subdued economic conditions again combined to hold back sales," IHS Markit economist Tim Moore said.

  18. Floating oil giant posts fall in income

    Oil platform

    They may be planning the world's biggest IPO but financial figures published by Saudi Aramco this morning showed a fall in income.

    In the nine months to the end of September net income at the oil giant fell 18% to $68.2bn (£52.7bn).

    Revenue slipped to $217bn from $233bn as the company was hit by lower oil prices.

    Average Brent crude dropped about 11% over the nine-month period compared with the previous year.

  19. Fracking halted in England

    BBC Radio 5 Live

    Wake Up To Money

    fracking site

    The government has called a halt to shale gas extraction - or fracking - in England amid fears about earthquakes.

    The indefinite suspension comes after a report by the Oil and Gas Authority (OGA) said it was not possible to predict the probability or size of tremors caused by the practice.

    Business Secretary Andrea Leadsom said it may be temporary - imposed "until and unless" extraction is proved safe.

    Geoffrey Maitland, professor of energy engineering at Imperial College London, told BBC Radio 5 Live's Wake Up To Money that the industry would "redouble" its efforts to show it is safe.

    But, he said: "It's going to be tough and the current traffic light system setting the bar at very low seismic events makes it hard to obtain more data that will validate models that are being used".

    He backs fracking and some of his work is funded by Shell which has fracking operations outside the UK. He said that in the US the authorities allowed for three or four magnitudes higher and added that the geology was not the same and the population density was lower in areas in the US where fracking was taking place.