It’s somewhat baffling, and perhaps even more worrying, how so much can go on in a week surrounding Brexit and yet so little progress can be made. Following two votes and a whole load of debates, the UK is not much closer in determining what and how it will leave the EU at the end of March. What we do know from this week though, is that more companies continue to leave the UK in fear of the implications of the departure.
Away from the Brexit drama, Donald Trump’s plans to build his border wall re-entered the spotlight this week as it effectively caused the US Government shutdown. Also, Netflix and Ryanair both saw their prices fall following the release of an earnings report and a forecast cut respectively.
Brexodus and a Brexican standoff after Government suffers colossal defeat
The Brexit puns could keep on coming, but there’s not too much to laugh about in terms of the UK’s departure from the EU… especially for Theresa May.
Tuesday saw her deal that was agreed with the EU voted down in catastrophic fashion, signifying the largest loss by a government in the history of UK politics. Just 31.86% of MPs in the House of Commons voted in favour of the deal, despite fellow Tories making up 330 of the 650 members of the House. Rebels temporarily abandoned their allegiance to May and the party to vote down the deal.
A vote of no confidence of the Prime Minister was then launched by Jeremy Corbyn directly after the result. May survived this the following evening, but that did little to salvage the damage the meaningful vote result inflicted the night before.
May promised to speak to all party leaders about how to come to a resolution regarding the deal, but with Corbyn not willing to speak to May until she ‘can rule out no deal,’ the UK faces a Brexican standoff.
A number of different scenarios could now happen, but the exact future and path the UK will take is not clear. What is clear though, is that a Brexodus is occurring. Phillips and Jaguar Land Rover are just two of many firms to recently indicate significant jobs cuts made as a result of Brexit uncertainty. Many more could follow suit if a deal is not struck soon.
Having said that, some UK firms seem to still be prospering. Lloyds for instance, recently reported they were creating 2,000 jobs as part of a digital renovation.
Trump’s wall is back on the agenda… but the Americans are paying for it
The U.S Government shutdown doesn’t look to be coming to an end anytime soon. It came about after spending plans could not be agreed between Trump and the Democrats in Congress. The main issue is regarding the President’s notorious Mexican-border wall, and how he wants funding for it to tighten immigration controls. No agreement for that has been met, meaning Trump continues to refuse to sign the necessary finance bill. As a result, the US Government has experienced the longest shutdown in its history.
As declared throughout his election bid, the Mexicans (supposedly) were going to pay for the wall, but plans have since been revised and the official line now states the US taxpayer will fund the project. This is all coming straight off the back of trade tensions with China that heavily affected some US companies, and a long-term resolution still hasn’t been found.
Ryainair’s cheap fares blamed for forecast cuts
A cut in profit forecasts for Ryanair has come off the back of fares being reduced over winter, says chief executive Michael O’Leary. The airline’s stock price fell nearly 5% this morning in reaction to the news, and given that O’Leary says further fare reductions could be imminent, this may continue to fall in the coming weeks.
Netflix price falls despite impressive figures
Similarly to how the pound grew stronger directly following the meaningful vote result, Netflix’s price has fallen today, despite the fact strong figures have been released for the Christmas period. It fell over 5%, despite enjoying more profit and subscriber sign-ups than expected, as revenue figures fell short of many analysts’ predictions. Netflix attracted 8.8 million new (paying) subscribers over the holiday period, with exclusives such as Black Mirror’s ‘Bandersnatch’, ‘Birdbox’ and ‘You’ all proving to be popular watches.
Graph showing recent price of Netflix.