14th January 2020

Written by Sabina Kadić-Mackenzie, Associate Partner

Edited by Harriet Moll, Creative Director

Good morning,

On this very day in 1236, King Henry III married Eleanor of Provence. Famed for her beauty, she was dark-haired, dark-eyed and hard-headed. Despite her devotion to the monarch and vice versa, Eleanor was loathed by her subjects. She was reportedly often attacked by angry mobs who pelted her with stones, mud and rotten eggs. For historical context, Eleanor came in the middle of a crisis of identity for the royals and her husband was determined to quickly nip any animosity towards his queen in the bud. It didn’t work. The more the king loved her, so her influence over him grew. So too, did her unpopularity. Moving on from the history lesson, a similar tale has unfolded since another royal Henry married Meghan Markle in 2018. Although she hasn’t been pelted with rotten eggs, the actress-turned-duchess has endured the modern-day equivalent by way of Britain’s tabloids and social media, culminating in a “bombshell” announcement that the couple plan to step back as “senior members” of Britain's royal family. Yesterday, five days after “Megxit” was unceremoniously announced without the prior consent of the Queen, an unprecedented royal summit took place at Sandringham involving Prince Charles, Prince William and Prince Harry, with Meghan said to be on speakerphone. The result? The “firm” “reluctantly” agreed to a period of “transition” for the couple, with the Queen stating that while she would have preferred them to remain full-time royals she was “entirely supportive” of the plan. But whether you care about the family drama that has played out since “a 35-year-old man told his granny he was moving abroad” (as one of my colleagues put it) or not, there are long-term implications to what is unfolding. Consider the constitutional changes required for such a transition as well as the wishes of 2.4 billion people of the Commonwealth and crucially, the financial arrangements for the couple. The optics of funding royals who have stepped back from public duty to any extent will have crossed her majesty’s mind, or at least that of her PR advisors. But one hopes it was Britain’s global reputation as an inclusive, tolerant, diverse and welcoming nation that was front of mind at Sandringham yesterday. Rightly or wrongly, in the wake of the turmoil, the royals and wider Britain stand accused of everyday racism. From onlookers around the world and closer to home. It’s an accusation no family wants written into its history. In the coming days and weeks, not for the first time, the royals and the Queen specifically will need to measure her communications carefully. Conscious of their part in another important moment in royal history, they will want to ensure that unlike the royal crisis of identity during Henry III’s reign, the House of Windsor is remembered for embracing change and modernising the monarchy, and not nipping it in the bud.

News

The five Labour leadership hopefuls to reach the next round of the contest after passing the threshold of 22 backers are Sir Keir Starmer, Rebecca Long-Bailey, Jess Phillips, Lisa Nandy and Emily Thornberry. Starmer, the shadow Brexit secretary, was the clear favourite among MPs, with 89 nominations, while Rebecca Long-Bailey, the favoured candidate of many Jeremy Corbyn allies, came second on 33. The winner of the Labour leadership contest will be announced on 4 April. This year’s Academy Awards nominations have been announced, with Todd Phillips’s Joker up for eleven trophies including best picture, best director, and best actor for Joaquin Phoenix. Once Upon A Time… In Hollywood, The Irishman, and 1917 follow with ten nominations each. Britain’s Cynthia Erivo is up for the best actress award for her performance in Harriet alongside Saoirse Ronan for Little Women, Bombshell’s Charlize Theron and Judy star Renee Zellweger. A study has found that the world’s oceans were warmer in 2019 than at any point in recorded human history. According to the Record-Setting Ocean Warmth Report, the ocean’s temperature was approximately 0.075C above the 1981-2010 average. The findings also remark that the heating was distributed across the world’s oceans, with the Atlantic Ocean and Southern Ocean having absorbed the most heat.

Business and economy

The United States will drop China’s “currency manipulator” designation ahead of a trade deal between both countries, according to a US Treasury official. Donald Trump had made the controversial decision of tagging China with that label last summer when tensions between Washington and Beijing escalated. The signing of the agreement is expected to take place this week and aims to halt the Sino-American trade conflict. (£) Google’s parent company Alphabet is set to hit the $1 trillion (£770bn) valuation mark following a share price surge backed by positive analytic coverage. Analysts raised their target prices for the Silicon Valley company, which will announce its Q4 earnings on 3 February, based on optimism about growth in its advertising division. Only Apple, Microsoft, and Amazon have achieved the trillion-dollar milestone thus far. A US delegation has warned the UK government against using Huawei technology in Britain’s 5G network, saying it “would be madness”. American officials are seeking to pressure No 10 on the issue ahead of the UK’s decision this month on whether to allow the Chinese tech giant to supply “non-core” parts for its network. Boeing’s new CEO, Dave Calhoun, has said that he is confident in the future of the business, but conceded that the company must improve its culture to “build on strengths”. In an email sent to all employees, Calhoun has vowed to listen to them, customers and regulators, and to get approval for the 737 Max, which has been grounded since March after 346 people died in two fatal crashes, to fly again.

Columns of note

In City A.M., Mark Bridgeman writes about the imminent revolution taking place within farming in the UK. Showing his suspicion over the replacement of farming for new production technologies like ferming, Bridgeman argues that agriculture has become even more efficient and has managed to meet the challenges of the day over thousands of years. The sector is now facing the challenge of bringing farming into harmony with nature, which could be done by maximising sustainability with the creation of advanced artificial intelligence enabling precise nutrient use and diet formulation, as well as remote decision-making. Crisis’ chief executive Jon Sparkes argues in The Times that society cannot accept homelessness as normal in any of its forms. With around 17,000 individuals and families currently homeless in Great Britain, the government’s announcement to unfreeze housing benefit is not enough to end rough sleeping, as current levels do not cover the true cost of rents. This shortfall in housing benefit has made people give up basic necessities to make up their rent or face eviction. Sparkes concludes that more social homes must be built while ensuring that housing benefit covers the cost of bottom-third rents in local markets. (£)

Markets

What happened yesterday?

London stocks closed in the green on Monday, with the FTSE 100 up by 29.75 to 7,617.60. The pound was weaker both against the US dollar by 0.5% at 1.2984 and versus the euro by 0.8% at 1.1657 as investors expect rate cuts following the release of data showing that the UK economy grew at its weakest pace in November since 2012. In corporate news, BAE Systems (+3.58%) rallied on the back of an upgrade at Bank of America, while Taylor Wimpey (+2.20%) was supported by upgrades at Merrill and Peel Hunt. Halma (+1.10%) finished stronger following an upgrade to “buy” at Goldman Sachs. On the downside, life insurance companies St James's Place (-1.67%) and Just Group (-7.73%) were hit by downgrades at Credit Suisse, while Homeserve (-1.22%) and Mitchells & Butlers (-2.89%) was weaker after being downgraded to “neutral” at JPMorgan. Man Group (-3.91%) was weaker after a downgrade to “equal weight” at Barclays. Across the Atlantic, all eyes were on the signing of the phase one trade agreement between the US and China.

What's happening today?

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Trading Announcements Boohoo PageGroup Taylor Wimpey

AGMs

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UK Economic Announcements (09:30) Consumer Price Index

Int. Economic Announcements (13:30) Consumer Price Index (US)

Did you know?

No children – between the age of 0 and 15 – died in traffic accidents in the whole of Norway in 2019, according to the Norwegian Public Roads Administration.

Parliamentary highlights

TODAY House of Commons Oral questions Justice (including Topical Questions) Debate on the Address Education and Local Government Adjournment Proposed closure of HMRC tax office in Cumbernauld – Stuart C McDonald House of Lords Oral questions Nuclear power capacity required to meet the Government's target of net zero emissions by 2050 - Lord Ravensdale Plans the Constitution, Democracy and Rights Commission has to engage with civil society - Baroness Bennett of Manor Castle Effect of vaping on public health - Baroness Redfern Assessment of (1) management of, and (2) overspend on, the UK's nuclear weapons programme - Lord Tunnicliffe Legislation European Union (Withdrawal Agreement) Bill - Committee stage (day 1) - Lord Callanan Scottish Parliament Scottish Government Debate Improving the Lives of Gypsy/Travellers Committee Announcements Members’ Business – S5M-20270 Richard Lyle: The Showman’s Guild of Great Britain and Northern Ireland TOMORROW House of Commons Oral questions Wales Prime Minister's Question Time Debate on the Address A Green Industrial Revolution Adjournment Ockenden review of maternity care at Shrewsbury and Telford Hospital NHS Trust - Lucy Allan House of Lords Legislation European Union (Withdrawal Agreement) Bill - Committee stage (day 2) - Lord Callanan Oral questions Ensuring safe staffing in social care and the NHS in this Parliament - Baroness Watkins of Tavistock Situation in Hong Kong - Lord Alton of Liverpool Engaging civil society in climate change issues ahead of COP26, to be held in Glasgow in November 2020 - Baroness Boycott Decision by Counter Terrorism Policing South East to include Extinction Rebellion on a list of extremist ideologies to be referred to the Prevent programme. - Lord Berkeley Legislation European Union (Withdrawal Agreement) Bill - Committee stage (day 2) continued - Lord Callanan Scottish Parliament Members' Business — S5M-19364 Alexander Stewart: The Valuable Role of Independent Prison Monitors Scottish Conservative and Unionist Party Debate Education Members’ Business – S5M-20295 John Finnie: Celebrating Scotland’s Wetlands on World Wetlands Day 2020