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Monday Update

DB Live: RBS home working offer; vaccine boost; M&G bid


5.30pm: Spain exempt from quarantine list

Full story here

4.45pm: London close

The FTSE 100 dropped into the red despite positive early results from the University of Oxford Covid-19 vaccine trials which helped to drive AstraZeneca higher.

London’s leading index closed 28.78 points lower at 6,261.52p.

3.30pm: RBS staff offered home extension

RBS Gogarburn

Royal Bank of Scotland has told 50,000 staff that the “vast majority” can continue to work from home until 2021.

In a memo to staff on Monday, RBS said it would extend the option to work from home beyond September which was the original agreement.

A spokesman for RBS, which will change its name to NatWest Group on Wednesday, said: “Like we’ve done throughout the pandemic the decision has been made carefully, including considering the latest guidance from the UK Government on Friday and our own health and safety standards and procedures. It’s a cautious approach but we feel the right one to take currently.”

The Edinburgh-based bank said it had kept 95% of its branches open during lockdown, and about 10,000 of its staff had continued to work in them. A further 400 whose jobs could not be done from home were asked to return to offices and call centres in June.

It said that for those who had returned to its offices, hot desking had been banned, and there were strict measures in place to ensure social distancing.

2.45pm: Vaccine boost

A coronavirus vaccine developed by the University of Oxford appears to be safe and trains the immune system, scientists have found.

Trials involving around 1,077 people showed the injection led to them making antibodies and white blood cells that can fight coronavirus.

Volunteers only suffered minor side effects, the most common being fatigue and headaches, which were alleviated by taking paracetamol before and for up to 24 hours after their vaccination.

University researchers have partnered with drugs giant AstraZeneca, based in Cambridge, to mass produce the drug, though they have cautioned against it being a cure for Covid-19.

Noon: M&S confirms job cuts

Marks & Spencer is to cut up to 950 jobs, with store management and head office roles mostly affected.

The company said it planned to accelerate a move towards “a leaner, faster” structure. It is also closing a Scottish store.

Full story here

10am: M&G hunts UK Mortgages

M&G Investment Management has launched a hostile approach for UK Mortgages on behalf of one of its managed funds, M&G Specialty Finance Fund.

Its decision to go hostile is based on the rejection of several attempts at a recommended cash offer, including the latest one at 67p per share valuing the company at £183m.

The offer represents a 21% premium to the UKML closing share price of 55.5p on Friday.

Under the proposal, UKML shareholders are also entitled to receive and retain the 0.375p per share dividend for the fourth quarter.

M&G Investment Management, part of the £250 billion asset holding M&G Group, said it “hopes to engage with the UKML board with a goal of securing a recommended transaction”.

8.30am: London opens lower

The FTSE 100 dipped at the open as investors remained nervous over rising coronavirus cases in the US.

London’s lead index was trading 1.03% or 64.7 points lower at 6225.6

7am: Markets

Spread betters expect markets to open lower after European leaders failed to agree on a stimulus package to help revive the bloc’s economies which have been hammed by the coronavirus.

Brent oil was trading at USD42.84 a barrel. The Japanese Nikkei 225 index is flat while in China, the Shanghai Composite is up 2.5%, and the Hang Seng index in Hong Kong is flat.

6am: Dividends cut

Companies cut dividend payouts to shareholders by almost £22bn in the three months to the end of June, according to Link UK’s dividend monitor.

Full story here

Today’s agenda


* Aviation campaign: Trade union Unite Scotland launches a campaign to ‘Save Scotland’s Airports’ as the nation’s civil aviation industry faces immense pressure due to the Covid-19 pandemic.  Companies and airlines, such as BA, Menzies Aviation and Swissport, operating at Aberdeen, Edinburgh and Glasgow airports have redundancy consultations under way which threaten about 1,500 jobs. 

Cutbacks in the aviation and aerospace industries could deliver a £320m blow to the economy, according to research by the Fraser of Allander Institute commissioned by Unite and published last week.

* Cheap labour: More than 90 retailers, MPs, peers, investors, and public bodies call on the Home Secretary, Priti Patel, to halt the exploitation of garment factory workers in the UK. A joint letter, coordinated by the British Retail Consortium, demands the introduction of statutory licensing of garment factories to ensure they meet their legal obligations to employees and are ‘Fit to Trade’.

* Spanish travel: Scottish government is expected to confirm whether travellers from Spain will continue to be subject to quarantine

* Hong Kong: Foreign Secretary Dominic Raab will make a statement on Hong Kong

* Trade Bill: MPs will consider 31 pages of amendments setting out post-Brexit terms

Today’s top Daily Business headlines

Supply disruption a new hazard as profits hit

£50m hotel to replace Debenhams in Princes St

Johnson heads to Scotland as ‘power grab’ row deepens

PwC hired on £200k deal to advise on ferries fiasco

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