Five Things You Need to Know to Start Your Day
Five Things You Need to Know to Start Your Day
(Bloomberg) --
Good morning. The U.K.’s Labour Party is having an antagonistic annual conference, Thomas Cook has collapsed and there’s a bevy of court decisions coming up this week. Here’s what’s moving markets.
Labour’s Party
The Labour conference has not had much of a party atmosphere. Attendees arrived to reports of a plot to oust the deputy leader and all are watching for a clear signal about what the party’s definitive stand is on Brexit, the key policy divide which is threatening to tear them apart. That will all play out in the shadow of the Supreme Court, due to hand down its decision on whether Boris Johnson’s government’s prorogation of Parliament was legal or not and, in the process, testing the very boundaries of what the court’s jurisdiction over domestic politics is.
Repo Fallout
Just as the world learned what proroguing was earlier in the summer, last week was dominated by understanding the repo market. The Federal Reserve had to work overtime to keep overnight rates under control and the liquidity of the financial system nice and, well, liquid. But there are likely to be plenty of lessons to be learned, most notably that the scramble to inject cash into the financial system last week demonstrated a fundamental problem which, should the economic situation really take a turn for the worse, may well spell more trouble and plenty more work for the overseers.
Tech in Court
Two very significant rulings are due to be handed down in Europe this week, neither of them having to do with proroguing Parliament. Alphabet Inc.’s Google is bracing for another landmark privacy decision at the European Court of Justice, five years after the “right-to-be-forgotten” ruling, on whether that right should apply globally and on drawing the line between privacy and freedom of speech. Separately, Apple Inc. will be closely watching rulings on two tax cases involving Starbucks Inc. and a Fiat Chrysler Automobiles NV unit that could provide early clues on the iPhone maker’s 13 billion-euro case.
Cook’s Collapse
Thomas Cook Group Plc, the 178-year-old travel agency that has struggled under the weight of competition and a hefty debt load in the past couple of years, has filed for bankruptcy. The group, already the worst-performing stock in the U.K.’s FTSE All-Share index in 2019, added to those losses on Friday when it said it was seeking extra funding on top of the rescue it was already working on, and has now failed after its attempt to secure a new bailout deal fell on deaf ears. Rest assured, a household name like this falling will be on the lips of the entire country.
Coming Up...
Stocks in Asia slipped as traders watched the latest trade talk developments, European futures look a little mixed. Euro area, French and German PMI readings will be on the way and watched as closely as ever given the precarious state of the continent’s economy. A cabal of Federal Reserve policymakers will also be speaking following last week’s interest rate cut, the Bank of England’s Silvana Tenreyro will also speak at an event in Frankfurt and the European Central Bank’s Mario Draghi will testify at the European Parliament amid talk of risks of a new taper tantrum.
What We’ve Been Reading
This is what’s caught our eye over the weekend.
- ‘Helicopter money’ has become a hot idea.
- Everyone in North Macedonia wants to farm cannabis.
- The start of the great climate exodus in the U.S.
- ‘Game of Thrones’ had a very good night at the Emmy Awards.
- Punk legends The Clash taking on Wilson tennis rackets.
- Altcoins use the weekend to catch up with other crypto.
- The one-week soccer season at the edge of the world.
To contact the editor responsible for this story: Celeste Perri at cperri@bloomberg.net
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