Friday Briefing: Change, reflection and business speak

Friday Briefing

James Baxter-Derrington
clock • 3 min read
James Baxter-Derrington (pictured), editor

James Baxter-Derrington (pictured), editor

Entering a new year always brings with it change, reflection and the inevitable circling back that many hope would have been forgotten.

Even in just this four-day week, with teams divided between those smart enough to remember to take annual leave and the rest of us, the investment industry has already seen all three.

Today, the typical ‘inflation falls X%' shell was ripped up, as Eurozone inflation rose to 2.9% in December, up 50bps from its two-year low in November.

Friday Briefing: 2023 or 2022, again?

German energy nudged the inflation figure higher, although core inflation continued to fall across the currency-linked region, down to 3.4%.

This begins a period of reflection on the bullish sentiment regarding cuts to interest rates, with markets having "got a bit ahead of themselves" in the tail-end of 2023, according to Premier Miton Investors CIO Neil Birrell, although he clarified "sizable cuts" were still likely.

Daniele Antonucci, Birrell's counterpart at Quintet Private Bank, offered his own reflection, arguing the Eurozone was likely already in a "mild technical recession", a factor which countered the delayed cuts scenario.

Across the Atlantic, the US jobs market remains surprisingly robust, adding 216,000 jobs in December, a factor which Hargreaves Lansdown's Sophie Lund-Yates argued may require a "heavier hand" from the Fed.

Friday Briefing: What next for Woodford investors?

Staying with the Bristol-based platform, it can add Point72 Asset Management to the list of firms which believe it's overvalued.

Headed by Steve Cohen (whose companies have an… interesting history with trading), Point72 and its European division took out a collective 1.16% net short position against the firm.

This marks the seventh position against HL, which also suffered a demotion from the FTSE 100 at the end of last year, ending a dozen years in the UK's blue-chip index (which turned 40 this week, so, party poppers and all that).

Circling back to the UK's (arguably) languid markets, TUI finally pulled the trigger and confirmed it would be seeking shareholder and regulatory approval to delist from the London Stock Exchange.

Friday Briefing: Do YOU own an Innovative Finance ISA?

The move follows an announcement from 6 December that Europe's largest tour operator (headquartered in Germany) was assessing whether its dual listing in London and Frankfurt remained "optimal and advantageous". Apparently not.

And for those seeking to reflect on potential change while circling back, the HM Treasury consultation into investment trust cost disclosure reforms closes to submissions on 10 January.

In the paraphrased words of Gravis' William MacLeod, while the mouse has been dealt with, it seems the Gruffalo has been forgotten.

As it stands, firms are offered "forbearance" regarding the disclosure of costs, meaning they'd technically be breaking the rules, but the FCA has pinky-promised they won't do anything about it.

Friday Briefing: Yet further evidence timing the market is hard

As is generally the case, the industry is after clarity and we can hope that through the combination of statutory instruments and Ros Altmann's private members' bill, this can be provided to a thriving part of the financial world which has struggled with its designation under AIFMD.

Thanks to the general election looking very much like an Autumn affair, there's even a chance to get the private members' bill over the line before parliament is dissolved and we start from square one with that particular option.

You can always pretend replying to the consultation was your new year's resolution.

This article was first published as part of the Friday Briefing series, which is available exclusively to Investment Week members each week. Sign up here to receive the Friday Briefing to your inbox each week.

More on Economics

The Christmas period failed to 'make amends for a challenging year of sluggish retail sales growth', as consumers held back spending due to weak confidence.

UK sales growth dips below average in December

British Retail Consortium

Cristian Angeloni
clock 09 January 2024 • 2 min read
The BLS noted that employment continued to trend up in government, health care, social assistance and construction, while transportation and warehousing saw dwindling total jobs.

'Stronger than expected' US jobs market shakes faith in imminent rates cuts

216,000 new jobs

clock 05 January 2024 • 1 min read
Firms expected their output price inflation to fall in the next 12 months by 1.5 percentage points from the 4.4% reported for Q4 2023.

UK businesses forecast sizeable drop in inflationary pressures

Potential rate cuts on the horizon

Cristian Angeloni
clock 04 January 2024 • 1 min read