Yahoo Finance What to Watch: Halloween Brexit, Ted Baker new CEO, and Interserve audit investigation
Here are the top business, market, and economic stories you should be watching today in the UK, Europe, and abroad:
Halloween Brexit
The EU and the UK have agreed a “flexible” extension to the Brexit timetable until 31 October.
The decision in the early hours of the morning came after five hours of talks at an emergency EU summit in Brussels. UK prime minister Theresa May had previously been asking for a delay until 30 June. European Council president Donald Tusk repeatedly said he favoured a year-long extension.
The pound rose against the dollar and the euro in the immediate wake of the decision but is losing ground on Thursday morning. Sterling is flat against the euro at €1.16 (GBPEUR=X) and flat against the dollar at $1.30 (GBPUSD=X).
“Sterling failed to take flight following news of the UK’s spooky Article 50 ‘flextension’, the currency perhaps held back by lingering doubts over whether the country’s MPs can ever reach an agreement over what kind of Brexit they want,” said Connor Campbell, an analyst with SpreadEx.
Ted Baker names new CEO
Ted Baker (TED.L) has announced that Lindsay Page will become its new chief executive with immediate effect following founder Ray Kelvin’s departure earlier this year.
At the same time, the retailer announced the conclusion of an investigation into harassment allegations levelled at Kelvin. The investigation by law firm Herbert Smith Freehills identified “several areas for improvement” in the retailer’s HR practices.
Ted Baker has begun a “refresh of its HR policies to ensure their alignment with current best practice.” It is not commenting on the specific allegations which were made against Kelvin, who was accused of enforcing a “hugging” culture at the company. Accusations were also made that he massaged employees, kissed their ears, and asked some to sit on his lap.
Chairman David Bernstein said: “We are determined to learn from this process and, moving forward, cultivate a better environment for all employees where they always feel respected and valued.”
Interserve accounts investigated
The accountancy watchdog has launched an investigation into Grant Thornton’s audit of outsourcer Interserve, which was placed into administration last month.
The Financial Reporting Council is to investigate the accountant’s audits of financial statements for 2015, 2016, and 2017.
The investigation will be conducted under the audit enforcement procedure.
WH Smith profits fall
Retailer WH Smith has seen half-year profits fall 21% after being stung by costs linked to its acquisition of InMotion.
The high street chain saw pre-tax profit drop from £82m to £65m in the six months to 28 February. Sales rose 8% to £695m or 1% on a like-for-like basis.
CEO Stephen Clarke said: “The integration of InMotion is progressing well. This acquisition doubles the size of our business outside of the UK where we are now present in 99 airports and 30 countries.”
Crypto debit card to launch in UK
Top cryptocurrency company Coinbase plans to launch a Visa debit card in the UK that will let people spend cryptocurrency in shops and online.
Coinbase UK announced plans for the card on Thursday. It will be linked to Coinbase accounts, which let people buy and hold a range of cryptocurrencies such as bitcoin (BTC-GBP) and ethereum (ETH-GBP).
“We’ve invested nearly 12 months in this and we’re very excited about this,” Zeeshan Feroz, the UK CEO of Coinbase, told Yahoo Finance UK.
App-only bank faces regulators questions
App-only bank N26 has become the second billion-dollar European banking startup to face questions over compliance.
German business daily Handelsblatt reported on Monday that BaFin, Germany’s financial regulator, identified “numerous” shortcomings at Berlin-headquartered N26 related to staffing levels, outsourcing, and engineering.
The news follows separate inquiries by UK regulators into Revolut, a rival banking app headquartered in London.
Board shake-up at Sir Philip Green’s Topshop
Retail billionaire Sir Philip Green has appointed two restructuring specialists to the board of his company Arcadia as he looks to turn around its ailing fortunes.
The BBC reported that Jamie Drummond Smith, chairman of finance group Cattles, has become chairman of Topshop, Topman, Arcadia Group, and the ultimate parent company Taveta. Peter Bloxham, the former head of restructuring and insolvency at law firm Freshfields, has also joined the Taveta board.
It comes as Green seeks to turn around the fortunes of his once-mighty retail empire, which has struggled to adapt to the shift of fashion sales online over the last decade.
European markets
European stock markets were generally lower with little momentum about.
“European equities followed through on yesterday’s gains with the backdrop still fairly benign – the risk event comes when US earnings season comes about and the worry is we see some selling into that,” said Neil Wilson, chief market analyst at Markets.com.
Britain’s FTSE 100 (^FTSE) was down by 0.5%, Germany’s DAX (^GDAXI) was down by 0.3%, France’s CAC 40 (^FCHI) was flat, and the Euronext 100 (^N100) was flat.
Asian markets were mostly lower overnight. Japan’s Nikkei 225 (^N225) closed up by 0.1%, but Hong Kong’s Hang Seng index (^HSI) was down by 0.8%, and China’s benchmark Shanghai Composite (000001.SS) was 1.6% lower.
What to expect in the US
US stock futures were pointing to a lower open later today in the US. S&P 500 futures (ES=F) were down by 0.1%, Dow Jones Industrial Average futures (YM=F) were 0.1% lower, and Nasdaq futures (NQ=F) were down by 0.1%.
