Public borrowing breaks new record
The UK debt has topped £2 trillion for the first time, as the government ramped up spending to cushion the economic fallout of coronavirus. In July, public debt exceeded the value of goods and services produced in the UK for the first time since 1961. Borrowing between April to July is estimated to have been £128.4bn more than in the same period last year, making it the highest level of borrowing seen in the period since records began at the Office for National Statistics.
Apple hits $2tn
Shares surge
Apple’s (US:AAPL) market value has surpassed $2trn (£1.5trn) just two years after it became the world’s first $1tn company. The iPhone manufacturer is the second publicly listed company to reach $2tn, after Saudi Aramco (SA:2222) briefly touched the valuation in intra-day trading late last year. Apple’s share price also breached the $500 point this week, but a four-for-one stock split is due at the end of August. The company hopes that the move will make its shares more accessible to a broader base of investors.
Ant files for IPO
Dual listing planned
Ant Group has filed for a joint IPO in Hong Kong and Shanghai, planning to list no less than 10 per cent in new shares of its total capital. The financial payments group, an affiliate of Alibaba and parent company of China’s largest digital payment platform Alipay, made 72.5bn yuan (£80bn) during the first half of the year, up more than a third on the same time in 2019, and operating profit rose almost fivefold. Providing online consumer credit and small business credit services accounted for the largest proportion of revenue at almost 40 per cent.
Stamp duty sugar rush
South East leads
Commuter towns in the South East of England have recorded the biggest jump in properties for sale since the stamp duty threshold was raised, according to data from Rightmove. Demand in the region has risen by 74 per cent between 8 July and 16 August, compared with the same time last year, and by 61 per cent nationally. However, new listings have not kept pace, rising by 34 per cent across the UK, resulting in a 11 per cent reduction in available properties on the market. The decline in available stock was the most subdued in London, with properties on the market just 3 per cent lower than the same time last year.
Rio removes bonuses
Execs remain
Rio Tinto (RIO) has not blamed any one person for the destruction of ancient Aboriginal sacred sites in May in its internal review of the scandal. The miner blew up the Juukan Gorge rockshelters in the expansion of the Brockman 4 iron ore mine in Western Australia after the Puutu Kunti Kurrama and Pinikura people made clear their “extreme cultural and scientific significance”. The miner’s board has decided to remove the bonuses of chief executive Jean-Sebastien Jacques, iron ore boss Chris Salisbury and external relations executive Simone Niven, who is in charge of Rio’s relations with First Nations groups.
Pearson appoints Disney exec
Digital transformation planned
Pearson (PSON) has appointed former head of Walt Disney’s (NYSE: DIS) international arm, Andy Bird, as chief executive. Mr Bird will take up the role in October, replacing John Fallon, who will stay on as an advisor to the group until the end of the year. At Disney, Mr Bird led the entertainment group’s digital-first transformation, which included developing its direct-to-consumer strategy and marketing content as a service directly to the end user. Those are skills that will no doubt be prized by Pearson, which is grappling with a transition to online learning and attempting to reduce its reliance on print products.
UK travel slump
Losses mount
The UK economy is set to lose out on £22bn due to the collapse of international travel this year, according to the World Travel & Tourism Council (WTTC). International visitor spending could nosedive by 78 per cent compared with last year’s levels, which could lead to a £420m loss per week for the British economy. In the worst-case scenario, the WTTC estimates that 3m jobs supported by the travel and tourism industry are at risk of being lost. In 2019, the sector was responsible for one in 10 jobs.
Global dividend payments plunged by more than a fifth during the second quarter, compared with the same time last year, according to the latest Janus Henderson Global Dividend Index.
All regions saw lower payouts except North America, where Canadian payments proved to be resilient, but the UK suffered the worst fall at 54 per cent.
The asset manager’s best-case scenario is for global dividends to decline by 17 per cent this year, which would make it the worst year for shareholder payments since 2009, or by 23 per cent on a worst-case basis.
