10 things you need to know in markets September 14

Lighting
designers Motoko Ishii and Akari-Lisa Ishii present a two-day
special light show on the Eiffel Tower to celebrate the Japanese
cultural season and 160 years of diplomatic relations between
France and Japan in Paris, France, September 13,
2018.

REUTERS/Charles
Platiau

Good morning! Here’s what you need to know in markets on Friday.

1.
Bank of England Governor Mark Carney told senior government
ministers that a no-deal Brexit would probably see interest rates
rise rather than fall, according to people familiar with the
matter. Bloomberg reports that Carney, who joined a
cabinet meeting Thursday to outline the BOE’s planning for a
turbulent exit from the European Union, told those present that
crashing out without an agreement would lead to a fall in the
pound and higher tariffs, pushing inflation higher.

2.
China will not buckle to US demands in any trade negotiations,
the major state-run China Daily newspaper said in an editorial on
Friday, after Chinese officials welcomed an invitation from
Washington for a new round of talks. China and the
United States are set to return to the table with the threat of
new US tariffs looming after Treasury Secretary Steven Mnuchin
extended the invitation to counterparts in Beijing.

3.
British pub chain JD Wetherspoon’s full-year profit rose 16.5% as
it saw more customers during the football World Cup and a record
heatwave. Reuters reports that pre-tax profit after
exceptional items rose to £89 million in the year ended July 29,
from £76.4 million a year earlier. Like-for-like sales climbed
5%.

4.
UBS expects London to lose at least 25% of its euro clearing
volumes as a result of Brexit and thinks the losses could be even
greater in the event of a disruptive exit from the
EU. UBS said in a note on Thursday that it expects
the London Stock Exchange’s London Clearing House (LCH) to suffer
a “25% loss of market share of the euro-denominated clearing
market.”

5.
Britain’s Co-operative Group, the mutually-owned
supermarkets-to-funerals group, reported an 86% rise in
first-half profit, driven by a strong food sales performance and
the purchase of the Nisa convenience chain. Reuters
reports that the country’s biggest mutual group, which also
operates legal services and insurance businesses, said pretax
profit was £26 million in the 26 weeks to July 7, up from £14
million in the same period last year.

6.
Goldman Sachs announced a big shakeup to its leadership team
Thursday as incoming CEO David Solomon moved to put his
management team in place before taking over from Lloyd
Blankfein. Goldman named John Waldron, one of three
co-heads of the investment banking division, to president and
chief operating officer, and effectively Solomon’s No. 2,
according to memos the firm sent to employees on Thursday.
Waldron’s new role will become effective October 1.

7.
Asian shares nudged higher on Friday as moves by the United
States and China to resolve a bitter trade dispute and a sharp
interest rate hike in crisis-hit Turkey supported global risk
appetite. Japan’s Nikkei closed up 1.19%, the Hong
Kong Hang Seng is up 1.09% at the time of writing (7.25 a.m.
GMT/2.25 a.m. ET), and the Shanghai Composite is up 0.05% at the
same time.

8.
Ross McEwan, the Royal Bank of Scotland’s chief executive, has
been accused of deliberately misleading MPs in order to avoid
disclosing a police investigation into an alleged bribery scandal
at the bank’s restructuring unit. The Times reports
that Nicky Morgan, chairwoman of the Treasury select committee,
said that Mr McEwan had purposefully “withheld information of
relevance and interest” when he was questioned by the committee
in January about the bank’s disgraced Global Restructuring Group.

9.
Third-quarter markets revenue at JPMorgan Chase & Co is down
by a small percentage from a year earlier after adjusting for tax
law changes, Chief Financial Officer Marianne Lake said at an
investor conference on Thursday. Lake said the
revenues look like they will be down by a “mid-single” digit
percent.

10.
Shares of Cirrus Logic fell nearly 4% on Thursday after news that
Apple would no longer include a free headphone converter dongle
with iPhones. According to Barclay’s, the move will
hurt Cirrus Logic, which makes analogue chips used in Apple
devices.