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26/01/2017

Weekly News Bites: Pretty offal

Our top picks from this week's Morning Chat

Pretty offal: Millions of people celebrated the life and verses of Scottish poet Robert Burns last night with Scotch whisky (is there any other kind) and haggis, a pudding made of sheep heart, liver and lungs. The former is one of the Kingdom’s most wildly successful products ever, contributing £3.7 billion to the UK's balance of trade on a net basis last year. Exports of haggis, on the other hand, are much less impressive, clocking in around £2 million annually. (26/01)

Off the wall: The S&P 500 closed at a record high last night. The current push centres on earnings results; estimates suggest aggregate profits in S&P 500 companies rose 6.7% in the fourth quarter, picking up from the third quarter, when they finally broke a year-long spell of contraction. The other recent catalyst of equities, the “Trump reflation trade”, is being questioned by some investors as the President will order construction of a Mexican border wall today. Ironically, shares in Mexican cement giant Cemex are up 14% in 2017, and have doubled in the last 12 months. (25/01)

Coming full Merkel: German Vice Chancellor, Sigmar Gabriel, believes his country can exploit the vacuum resulting from the US exit of the Trans Pacific Partnership. Furthermore, he suggested President Trump stop blaming trade for his country’s ills, and “simply recognise” the US is uncompetitive. Mr. Gabriel is freer to speak his mind after unexpectedly stepping down as head of the social democrats yesterday, and thereby relinquishing the opportunity to challenge Angela Merkel in this year’s election. The bellicose 57-year-old recognised his own slim chances of victory. (25/01)

In a nut-Shell: British oil behemoth Shell became the world's biggest dividend payer last year, handing out £11.1 billion in income to investors. This is 40% more than in 2015, and more than the entire UK mid-cap index combined. Shell's dividends are fixed in dollars, therefore much of the increase was due to 2016’s collapse in Sterling. A similar story existed across UK companies, where dividends paid collectively jumped by 6.5% in 2016 to £84.6 billion. (24/01)

Getting out of a Jammeh: The former leader of the Gambia, Yahya Jammeh, went into exile following his loss in a recent election. This is an undeniable victory for democracy in Africa, and for the regional African power brokers that forced it through using both stick (i.e. troops on the border) and carrot (i.e. cushy offers of exile). Still, however, Mr. Jammeh raided the state Treasury prior to leaving, relieving it for $11 million in cash. (23/01)

 

 

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