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tv   BBC Business Live  BBC News  January 3, 2018 8:30am-9:00am GMT

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this is business live from bbc news with sally bundock and ben thompson. changing the rules — europe gets to grips with the biggest changes to the financial system since the financial crisis. live from london, that's our top story on wednesday, 3rd january. the eu is aiming to protect investors and boost competition but can the lengthy new rules really be made to work? also in the programme: the united states blocks the billion dollar takeover of moneygram by china's alibaba because of national security concerns. and cutting the cables. retailers are among the winners. and cutting the cables. we meet the boss of one firm that's bringing wireless
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charging to the masses. so, is it finally time to say goodbye to tangled wires and bulky chargers? and global car sales hit a new record, despite taxi apps and big investment in public transport. so we want to know — will owning a car ever become a thing of the past? let us know if you've got rid of your car. let us know. use the hashtag bbc biz live. hello and welcome to business live. i'm getting rid of mine this month, that's the car! the most significant changes to europe's financial system since the financial crisis come into force today. the eu's new rules are known as mifid two and are intended to protect investors, giving them better value for money and making europe's financial services industry more competitive.
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now, one of the biggest changes centres on the research investors use to decide which shares to buy and sell. it will now have to be charged separately rather than bundled with other financial services. and to improve transparency, all parties to financial transactions will have to provide a unique number known as a legal entity identifier to make any trades. 368,000 were issued between october and december — that's a huge jump that's being attributed to these changes. but it's already proving to be expensive — banks and asset managers are believed to be spending more than $2 billion implementing the new rules. matthew mcloughlin is the head of trading at the investment firm liontrust asset management. welcome to the programme. sally,
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outlining the details there and clearly this is a response to the financial crisis. i wonder how significant it is. how will this be being viewed in the city and elsewhere? sure, you can probably say how long it has taken together to put together. it has taken seven yea rs. to put together. it has taken seven years. the documents themselves contain1.7 years. the documents themselves contain 1.7 million paragraphs of new and updated rules. it is the biggest change we have had in the financial markets for the last decade in europe. sally touched on what it might mean for the banks. what will it mean for us? what difference will i see? sure. everybody in the studio and at home, they have pensions or some type of savings. all this money goes into stocks and the stock market, the bond market and otherfinancial instruments and it is a considerable amount of money. so, you need laws and we've learnt from history, 2008, strict laws around how the money is managed and governed. and i think
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todayis managed and governed. and i think today is the day when this piece of legislation comes into play. so whether you know about it or not, todayis whether you know about it or not, today is going to be an important day for investors as they will be gaining extra protection. you talked about how complicated it is. how many pages there are to wade through. is everybody ready? are all the banks in a position to say, "today is the day, we're good to go!’ "today is the day, we're good to go." that's an interesting question. we'll find out later today is the real answer. i would like to think the majority of people are ready or nearly ready. i'd like to think so, but i think there is a lot more work to do. it all sounds good in theory, doesn't it? this is a regulators trying to keep up with the banks. the banks got ahead of themselves and they were coming up with trading platforms that the regulators weren't aware of. it all sounds great, but are there any dangers. does this limit banks? one of the main dangers is the cost of implementing it. for brokers and
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asset managers. it is expensive business. so, if these costs create barriers to entry for the market then you might see fewer new incumbents coming to the market. that might less bring innovation and less competition. you might see possibly prices rising. that's the opposite of what it was designed to do, i hope that's not going to be the case, but time will tell. we will keep a close eye on that. matthew, thank you. let's take a look at some of the other stories making the news. the uk's international trade secretary liam fox is in china to try to strengthen business links for the country after brexit. it comes as the financial times reports that britain could be looking atjoining a trade deal between pacific nations that was scrapped after president trump withdrew the united states. britain's financial watchdog has confirmed it is investigating infrastructure giant carillion.
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the company, which has been forced to issue a string of profits warnings, says it's being investigated over the "timeliness and content" of announcements made between december 2016 and july 2017. that covers a period for the firm in which its share price slumped and its chief executive quit. the firm is building part of the uk's new high speed rail line hs2. spotify is being sued over falgations that it used thousands of songs without paying the relevant music publishers. the united states has blocked the sale of money transfer firm moneygram to a part of china's internet giant aliba ba. it was a deal worth $1.2 billion.
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it is the highest profile chinese deal to be rejected by washington since donald trump came to power. christine hah is following the story from our asia business hub in singapore. christine, tell us more. well, the company that was going to buy moneygram is company that was going to buy moneyg ram is aliba ba's company that was going to buy moneygram is alibaba's mobile credit and payments arm subsidiary and moneygram and payments arm subsidiary and moneyg ram thought the and payments arm subsidiary and moneygram thought the — alibi bab ba faces competition at home. this was really quite important for them. the deal was announced a year ago. they submitted it for approval and finally the moneygram ceo said it has become clear that the us authorities won't let it go through and part is due to security concerns over us users data. china, the
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chinese foreign ministry spokesman today came out and said that they really hope the us can create a level playing field for chinese firms, but it shows a toughening sta nce firms, but it shows a toughening stance that the us has taken. it is not the only deal that has been blocked and it won't be the last. injapan we had no action. a public holiday in tokyo. elsewhere in asia, we saw gains across board following another record breaker the night before in the us. we had technology stocks surging again state side and that fuelled the sentiment in asia. let's look at europe. in london, it is the retailers that are headed high. you can see the ftse down a little bit, but actually the likes of next and marks & spencer's are doing well. next coming out with better than expected pre—christmas sales. next is seen as a bellwether for the high street. does it imply
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that maybe our retailers had a better time than we perhaps thought? there was a concern about the high street stores ahead of christmas. so we will see how that plays out, but for now, next coming out with brighter news than we predicted. but across—the—board, in brighter news than we predicted. but across—the—boa rd, in europe, brighter news than we predicted. but across—the—board, in europe, a mixed picture emerging right now. and samira hussain has the details about what's ahead on wall street today. on wednesday the federal reserve, america's central bank will release the minutes from its last meeting in december. now at that meeting the committee members raised interest rates by 0.25% to a 0.5% and it marked the third rate rise for 2017. so investors will be looking at the minutes for more hints about any other rate rises that could be coming in 2018 and any new insight on the new us tax code and its economic impact. now, also happening the drugstore chain rite will report a drop in revenue, but the company's bottom line is likely to improve as it moves ahead with the process of selling 1932 of its outlets to walgreens boots alliance.
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joining us isjeremy stretch, head of currency strategy at cibc world markets. hi, jeremy. happy new year. i put oil on the board. iran is in the headlines and normally when we talk about the middle east and particularly places like iran or iraq, we talk about oil because you expect to see a spike in prices. it's not quite happened. but there is still a bit of confusion, isn't there? indeed. we're seeing numbers with the six as the big figure and i think that's quite important because, of course, we have seen this sort of maintenance of oil prices in a a0 to 60 range over the course of the last two or three yea rs. we course of the last two or three years. we are pushing towards the top end of that range. we haven't seen disruption yet, but because the issues raise those geopolitical fears in the region that is causing an increased degree of tension and we are waiting for the latest
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infa ntry we are waiting for the latest infantry data out of the us which may show that stockpiles are falling. we are in a global synchronised recovery. that's driving up demand for oil and if there is going to be disruption to there is going to be disruption to the supply then that could create instability in terms of prices and that would have inflationary consequences and it could have an impact on sell tral banks. so, having said all of that, and you you neatly wrapped up everything from the growth forecast to what central banks are doing to oil and share markets. what's ahead this year, do you think? well, i think as far as this year is concerned, i think there is still this perpetuation of a global synchronised recovery, but what we are seeing central banks outside of the us looking to maintain or looking to row back a bit in terms of the monetary stimulus. we have seen interest rates going up in the us over the course of the last couple of years, we have seen an interest rate hike
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in the uk and other places such as canada raising rates. we are starting to see other central banks starting to see other central banks starting to see other central banks starting to say there is no requirement to have such exceptionally easy monetary policies, we are going to see central banks stepping back a little bit and that's going to make it more interesting to see how the financial markets can actually operate on their own as it were. so moving away from the training wheels or the stabilisers which have been supporting markets. will the attention be off central banks to a degree? i feel in 2017 we were just watching them all like hawks really? i'm not saying, i wouldn't say that the attention is off, but it is switching to different central banks. so, growth, still looks to be firm both in 2018 and in 2019, but the question is how are the financial markets going to be able to operate as we start to see less stimulatetry performance from those central banks. we have seen the
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federal reserve hike interest rates in two years. it is the turn of others to step up to the plate. jeremy, thank you. you're really upset, you love talking about central banks. i do. it is upset, you love talking about central banks. ido. it is one upset, you love talking about central banks. i do. it is one of my favourite things. i will keep doing it. i don't care! she will! still to come, cutting the cable. we meet the boss of one firm that's bringing wireless charging to the masses. so is it finally time to say goodbye to tangled wires and bulky chargers? i hope so. you're with business live from bbc news. the latest news from ryanair. you might be surprised to hear this. ryanair passenger numbers were up again by 3% in december. that's despite the chaos from the cancelled flights and the pilot rota fiasco. it comes as ryanair confirmed it applied for a british
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air operating licence. a move that could be required if it's to keep its small domestic uk service operating after brexit. let's speak to peter morris, chief economist at the aviation consultancy, ascend. good to see you, peter. what do you make of rya nair‘s good to see you, peter. what do you make of ryanair‘s numbers? good to see you, peter. what do you make of ryanair's number57m good to see you, peter. what do you make of ryanair's numbers? it shows that it make of ryanair's numbers? it shows thatitis make of ryanair's numbers? it shows that it is not for no reason that they have become the biggest, most successful carrier in europe. they have been able to flex their business model and to expand across different routes all the way across europe and beyond and so they are dependant on individual markets becomes less and less. so they have been able to get to, i think, it is 95% load factors in december which is unheard of in the airline industry. so, they, you have to say they must be doing quite a lot right. brexit poses some questions. as we
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touched on in the introduction, they have now applied for this license which would allow them to keep operating their domestic service in the event of a hard brexit. can you explain the domestic service. what do they do? that is roots like from sta nsted to do they do? that is roots like from stansted to belfast or stansted to edinburgh and so on. but it is interesting. if you look at the schedule for this quarter compared to last year, you will see there is a cut in ryanair seats of something like 75% year—on—year. so their dependence on the uk market has actually reduced, particularly the uk domestic market. peter, thank you. peter morris giving us his take on the numbers from ryanair. a reminder if you want any more information on any of the stories we are covering, check out our website. this brings together all of the
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bbc‘s business journalism this brings together all of the bbc‘s businessjournalism including results from next and what the results from next and what the results tell us. also the story we brought you earlier about carillion under investigation from the financial conduct authority. details on the website. financial traders across europe are grappling with the sweeping new eu rules which came into effect today, which are supposed to protect you and me the investor, and boost transparency. the regulations come into force today but there are questions about whether banks and financial institutions are ready. many in the uk, france and germany said they are ready but elsewhere it is a slightly different picture. let's have a look at the markets in europe. last night we had a record close on wall street. there was a strong session in asia. but in europe, it is fairly mixed. london notjoining the party at the moment. some of the analysis
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does suggest the introduction of those regulations has put a damper on markets in europe today. banks and institutions have got to put things into effect and there is concern about smaller trading companies and how they are affected by this. we've all been there... out and about and suddenly your phone's battery dies. a perfect excuse not to be able to get in touch! and unless you're going to carry a tangle of wires and a bulky plug, it means you're out of luck. so that's why the market for wireless charging has exploded. it's expected to be worth $37.2 billion by 2022. it's expected to grow by aa% between 2016 and 2022. one big player in the market is aircharge. it's got 25,000 charging points in a0 countries. most of them operated in collaboration with clients
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like mcdonald's, starbucks, costa coffee, virgin atlantic and major hotel chains. we'rejoined by steve liquorish, the founder of aircharge. steve, nice to see you. welcome to the programme. we have touched a little bit on how it works. just explain it to us. i have brought my props with me. so this is what people might see. visually, it's sort of looks like a coaster. what you're seeing is this sort of thing being built in by furniture manufacturers like ikea. the automotive industry is putting charges into vehicles. it is a drop and charge solution. when you see the furniture, you see the coaster and that defines where you drop your phone on
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to charge the phone. the point is that i would simply have to put my phone on like that,... and that is transmitting power. the idea is to build an ecosystem globally so we can forget the wires and we have many to plug in. aircharge or an early mover in this market and consequently have become the world's largest deployer of public charging. 0ne largest deployer of public charging. one of the important thing is the industry has been waiting for is to come up with an industry standard. now we have the two big players, the handset manufacturers samsung and apple are playing in the same sandpit. when apple launched its iphone ten, your company was up there in lights and that is something you were surprised to see but what a fantastic moment for aircharge in terms of brand recognition. you describe yourself as one of the early movers. was luck, something you stumbled across backin luck, something you stumbled across back in asia in 2013? personally, i
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have always enjoyed technology be not technology for technology's sake. it made perfect sense. i made the analogy with hydration. we all drink water little and often all day. we are becoming reliant on devices and if we can have any ecosystem that is ubiquitous, a bit like hydration for your phone, if you look around restaurant, i can see people's phones, so why not have them charging while you are sat down and on trains, planes and automobiles etc? the makers of phones are making the batteries so good and much more better developed so good and much more better developed so that they last that much longer, so so that they last that much longer, so we're not always running out of battery. consequently screens are becoming brighter, we are consuming more and more media over our electronic devices, and consequently this battle between how much we use the devices and how quickly the battery technology can move forward is pretty, it is not catch up at the
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moment. battery technology is not catching up. it will be sometime in the future before we see the need for power to disappear. what is the biggest hindrance? we have often talked about this when we have talked about this when we have talked about this when we have talked about rechargeable cars, putting in the network. what comes first? it is a chicken and egg thing. is it the demand from consumers or is it that you can offer this stuff so people think the next phone that i buy i will buy one with wireless recharging capabilities? we reached tipping point a couple of years ago when we saw some big brands climbing on board with this technology. mcdonald's was an early mover. they saw it as a footfall driver, as a differentiator for their brand. that has encouraged the handset manufacturers. and the wireless power consortium, the industry global standard, has seen membership rocket in the last few months, since
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applejoined the rocket in the last few months, since apple joined the standard. so rocket in the last few months, since applejoined the standard. so huge things to come. i think we will all grown to expect wireless power like we do with wi—fi. if you cast your mind back to wi—fi before that scaled properly. what did we do before wi—fi? scaled properly. what did we do before wi-fi? absolutely! steve liquorish from aircharge, thank you. nowhere to hide. self—driving cars seemed like the stuff of science fiction not that long ago. but global auto giants are now developing and refining the technology, trying to work out what that future of cars will be. theo leggett got a sneak preview of one just launched by the french manufacturer renault. now, if you've never done this before, it really
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does feel quite strange. we are doing 115 kilometres an hour on the motorway, and i'm not touching anything. my colleague here has a safety setup just in case anything goes wrong, but the car is driving itself. now i'm going to do something that i've never done before and i don't think many people have. we're doing 103 kilometres per hour on the motorway and i'm going to put a virtual reality headset on. here we go. now, at the moment, i know i'm driving along the motorway. but because i've got the virtual reality headset on, i'm actually flying over a valley. i can see lakes beneath me. there are birds around me. there is a large lunar landscape up in front.
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so it's a completely different world. and what renault are trying to do here, is envisage a world in which you are doing a long journey, you don't need to drive the car, so you can turn your mind to other things. relax, sit back and enjoy the show. do as you have not seen him before. —— theo. a lot of you have been in touched about getting rid of your car. - seeing it in western europe are also seeing it in western europe outside the uk, where as people have benefited after they resent crisis, that has encouraged car sales to
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advance. jeremy, short and sweet, nice to see you. thanks for explaining that. thank you for your tweets. we will look through them later. see soon, bye—bye. good morning. we have had some lively conditions overnight thanks to storm eleanor. a very windy morning. we do have some showers to deal with as well. but the good news is, storm eleanor has moved into the north sea. behind it, still pretty windy. we will continue to see gusts of a0 to 50 mph for many of us, but up of a0 to 50 mph for many of us, but up to 70 mph for exposed areas in the west. if you are travelling, ta ke the west. if you are travelling, take care. there could be some trees down. keep up—to—date on your bbc local radio stations. generally, todayis local radio stations. generally, today is a day of sunshine and squally showers. the best of the
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brightness across parts of the south and east. north—east scotland enjoying best the of the drier and colder conditions. by about three o'clock this afternoon, a lot of dry weather across parts of southern england. the temperature is around 10 celsius. for much of wales it is a dry story as well but it will be gasly for exposed areas. some showers continuing across northern ireland, western parts of england and scotland as well. north—east scotland, pretty cold but it is dry and clear as well. through tonight, the showers will continue the journey north and eastwards. behind it we will see another weather front pushing up from the south—west. it will be breezy as well. temperatures tonight not dropping much in the south. chile across scotland getting down to about one celsius. tomorrow, the weather front will continue its journey north and eastwards. it will be breezy but nowhere near as windy yesterday. first thing tomorrow
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morning, yes for the rush—hour, we have the rain. there will be colder air across northern england and scotland. temperatures mild across the south, getting up to 13 selfies. friday will be another unsubtle day. this front is lingering across central parts of the british isles. —— friday will be another i'm settled day. colder air taking charge from the north—east so it will feel bitterly cold into the weekend, but at least there is some sunshine to look forward to. this is bbc news. i'm ben brown. the headlines at 9am: storm eleanor sweeps across the uk causing flooding, damage to homes and disruption to motorists following gusts of up to 100mph. more than 50,000 non—urgent nhs operations and procedures in england may be delayed until the end ofjanuary, due to winter pressures.
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patients who spend many hours on a trolley and these are often elderly patients, they are the sickest patients, they are the sickest patients in our department do much worse in the long—term. they are much more likely to have a poor outcome and even die as a result of their experience in the emergency department. my button's bigger than yours — donald trump warns kim jong—un the us has greater nuclear power than north korea.
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