Yahoo Finance Pound rallies over $1.32 against the dollar as probe into Russian involvement in Trump campaign deepens
Pound rallies over $1.32 against the dollar as probe into Russian interference in the US election deepens; Special Counsel Robert Mueller has issued a subpoena to obtain documents and emails from the campaign, according to a report in the WSJ
Struggling outsourcer Carillion issues third profit warning in a year; shares plunge as much as 60pc
Carillion said that it will breach its financial covenants; shares were worth around 250p just 11 months ago, today just 25p
FTSE 100 nudges down into the red early on; United Utilities and Mediclinic biggest laggards
Former Trump campaign adviser describes dollar-damaging documents as 'irrelevant'
Sterling is going from strength to strength on currency markets and is now at a four-week high against the sliding dollar.
The greenback is on the back foot after Special Counsel Robert Mueller issued a subpoena to obtain more documents from the Trump campaign as part of the probe into Russian election interference.
Mr Trump's former campaign adviser Carter Page told Reuters that the documents were "irrelevant and unnecessary" and said in a testimony that he believed the committee has received most of the documents from others already.
The defence hasn't been enough to convince forex traders but the dollar's losses are starting to ease.
Spreadex analyst Connor Campbell pointed out that a number of factors could have weighed the pound down today:
"With no data to speak of the pound felt comfortable in continuing yesterday’s rebound.
"Despite more negative noise from the EU surrounding Brexit – with the Netherlands preparing for a no deal ‘chaos’ scenario, and leaked documents suggesting May’s aim of a ‘deep and special’ relationship won’t be possible – sterling got off to a decent start this Friday."
UK wasting money as cutting edge firms hoover up tax breaks meant to help laggards
Philip Hammond should scrap tax breaks for research and development because they are swallowed up by high-tech companies which would invest regardless, economists have claimed – and instead spend the money directly on projects which need the help.
As much as 80pc of R&D tax credits are spent on projects which would happen anyway, the Institute for Public Policy Research (IPPR) estimates.
This means almost £2bn of spending is wasted on the credits each year, and could be put to better use elsewhere.
“The Government is in danger of missing the point in its industrial strategy. Its focus so far has been on sectors engaged in technological innovation, like automotive and pharmaceuticals. But productivity in these sectors is already high,” said the IPPR’s Michael Jacobs.
“The UK’s productivity problem lies in the vast majority of ordinary firms, in sectors such as retail, light manufacturing, tourism, hospitality and social care.”
Read Tim Wallace's full report here
Carry on Carillion
It would be churlish to pretend that this is a problem exclusive to Carillion in the sector.
Every outsourcer I can think of off the top of my head has issued a profit warning in the last couple of years (Mitie, G4S, Capita, Serco) and the problem always seems to be the same: overstretching themselves with contracts on margins thinner than tracing paper.
They are just a bit rubbish.
Accendo Markets head of research Mike Van Dulken has aptly titled his note on the firm this morning "Carry on Carillion".
Here's his two cents on the share price reaction this morning:
"The share price reaction today suggests acceptance of what we foresaw as an inevitable and highly dilutive rights issue to “encourage” shareholders into participation, to keep the restructuring ball in the air.
"Shorts who stayed the course (most shorted stock on FCA disclosure data), even adding, will be smiling all the way to the bank, having expected already serious corporate and financial troubles to worsen."
Carillion shares crash... again
Carillion bottom fishers probably wishing they hadn't bothered today -54%
As somebody very wise said to me many years ago: 'the bottom of the page is not the bottom of the chart!'— Chris Bailey (@Financial_Orbit) November 17, 2017
market cap now £78m thereabouts #CLLN Carillion - just sold healthcare for £50m on annual revs of £90m...
— Neil Wilson (@neilwilson_etx) November 17, 2017
It's time to sound the crashing Carillion shares klaxon.
The beleaguered outsourcer has issued its third profit warning of the year and warned that it expects to breach its financial covenants, adding that it is looking into "some form of recapitalisation".
Shares stooped as low as 16.5p this morning after nosediving 60pc. Carillion's shares were comfortably around the 250p mark around 11 months ago, an incredible fall. It will be a penny stock before long.
Agenda: Dollar on the slide as probe into Russian interference in US election deepens
The dollar is on the slide this morning following reports that a subpoena has been issued to obtain documents and emails from the Donald Trump campaign as part of the probe into Russian interference in the US election.
The subpoena is believed to have been issued last month by Special Counsel Robert Mueller and the deepening investigation has helped the pound rally against the greenback on currency markets this morning, climbing 0.3pc to $1.3235, a three-week high.
No key economic indicators are due in the UK today with second estimates for third quarter GDP and public sector net borrowing booked in the diary next week. US housing data and eurozone construction figures are the sole points of interest on the agenda for traders.
Asia shares up on US tax and earnings hopes BUT well off the highs. Dollar falls on media report of Mueller's subpoenas. Bitcoin hits record high, reverses 30% fall in less than a week. pic.twitter.com/Pa5IHRzJ9G
— Holger Zschaepitz (@Schuldensuehner) November 17, 2017
The mood on stock markets has been brightened by the House of Representatives passing corporate tax cut reforms in the US but the FTSE 100 is struggling to gain traction, nudging down into the red early on.
It must feel like Groundhog Day at battered construction outsourcer Carillion. It has issued a third profit warning of the year this morning and said that it will break its debt covenants, slashing its share price in half.
Interim results: Record, NextEnergy Solar Fund, Eros International, Anglesey Mining
Trading statement: Kier
AGM: Myanmar Strategic Holdings, Seeing Machines, Amur Minerals Corporation, Salt Lake Potash, Central Rand Gold
Economics: Building permits (US), Housing starts (US), Current account (EU), Construction output (EU)
