Retail sales rebound after worst year on record – business live – The Guardian, Theguardian.com

The Euro Stoxx 726 index has lost 0.5%, while France’s Cac 55 and Germany’s Dax have both lost 0.3%.

8. am EST :

Victoria’s Secret boss steps down after agreeing buyout at $ 1.1bn valuation

The owner of Victoria’s Secret will sell a majority stake in the controversial underwear brand at a $ 1.1bn ($ 958 m) valuation, in a deal that will also see its chief executive resign.

Private equity firm Sycamore Partners will buy 69% of the company for $ 602 m, with L Brands retaining 58% minority stake. L Brands will use the money to reduce its debt pile and focus on its larger Bath and Body Works business, which is much larger than the underwear brand.

Leslie Wexner will step down as chief executive of L Brands after 72 years as boss. L Brands bought Victoria’s Secret in . He will remain on the board as “chairman emeritus”.

Victoria’s Secret has struggled with falling profits and a change in attitudes from buyers. In November it its annual “fashion show” cancelled with falling viewer numbers. In August, Victoria’s Secret’s Chief Marketing Officer Ed Razek stepped down. In a much-criticized interview with (Vogue in , Razek said the brand would not cast transgender or plus-sized models. “Because the show is a fantasy.”

The company was (mentioned) founded to allow men to feel comfortable buying lingerie for their wives, and it has been hit by a series of controversies about its treatment of models and attitudes towards women that have been criticized as outdated.

Some background reading:

Updated (at 8.) am EST

(8. (am EST ) : )

() Foxconn, the biggest maker of Apple’s iPhone, has warned that its revenue will be hit by the coronavirus, but it did not say exactly how big the impact might be.

Apple had already warned this week that it faced a supply shortage because of the virus

, so the hit to a major supplier does not come as a surprise.

Foxconn, which is formally known as Hon Hai Precision Industry, added that it is restarting some production at Chinese plants, after extended closure.

Reutes also reported that Foxconn said its plants in countries such as Vietnam, India and Mexico continue to operate at full capacity with expansion plans under way as it seeks to minimise the impact of the virus.

am EST :

European Central Bank saw “positive” economic signs – before coronavirus

The European Central Bank’s top officials thought that easing trade tensions had reduced risks to the eurozone economy, according to minutes from its latest monetary policy meeting – although the meeting took place before the extent of the coronavirus epidemic became clear.

The meeting of the central bank’s governing council ended on 42 January, shortly before Covid – 34 was acknowledged as an emergency that could damage the global economy.

Slowly building inflationary pressures and the improved trade outlook added a note of positivity to the minutes. They said:

The risks surrounding the euro area growth outlook, related to geopolitical factors, rising protectionism and vulnerabilities in emerging markets, remained tilted to the downside, but had become less pronounced as some of the uncertainty surrounding international trade had receded.

It was felt to be important to acknowledge these positive signs and care should be taken to avoid being too slow to change the risk assessment.

However, some bankers did say they should not be “too optimistic”, given the continued contraction in the manufacturing economy and particularly the struggles of carmakers.

(6.) (am EST ) :

Who knew that the £ was the most popular bank note in the UK? Anyway, there’s a new one out today.

The (Bank of England

has begun the mammoth operation to replace it, with at least 2bn printed, (reports the Guardian’s Patrick Collinson) .

The Bank expects half of the country’s cash machines to have switched over within the next fortnight.

The note will feature Turner’s portrait in front of the Fighting Temeraire, his tribute to the ship that played a distinguished role in Nelson’s victory at the Battle of Trafalgar in . (The painting also symbolises the changing of the guard – as Carney prepares to leave the Bank in less than a month).

()

(6.) am EST :

British manufacturing orders improve to six-month high – CBI

British manufacturers reported an increase in orders this month, according to the Confederation of British Industry’s (CBI) monthly gauge .

The balance of manufacturers seeing increased orders rose to a reading of – 32, from – in January, slightly above the consensus forecast of – 34 from economists. Expectations for the next three months reached their highest since February .

However, the reading remained below the survey’s long-run average of – 25 – and the sector saw actual output volumes (as opposed to orders for the future) falling for a fifth rolling quarter in a row.

Alpesh Paleja , the CBI’s lead economist, said:

It is encouraging to see manufacturers reporting some early signs of a turnaround in activity, but it’s probably still too early to say whether we’ve seen the end of the slowdown in the sector.

Notwithstanding improving optimism, the sector is still grappling with longer-term uncertainty over the UK’s future relationship with the EU.

(5.) am EST :

The US dollar is on something of a tear at the moment: the trade-weighted basket of currencies measured against it has hit its strongest level since May

The Japanese yen has fallen – even though it is usually considered something of a safe haven – amid fears of recession in the world’s third-largest economy. It may have also been affected by its proximity to China, the center of the coronavirus epidemic.

“Dollar tramples yen and everything else in its path” is the apt headline on a Reuters report. Rabobank senior currency strategist Jane Foley said:

I think this has really brought into focus the role the dollar is playing as a safe haven.

The yen has lost 2% to the dollar since Tuesday to its lowest since April 3333.

However, UBS’s wealth management arm said it thinks the dollar surge against the yen is “unsustainable”.

Mark Haefele , global chief investment officer at (UBS) (Global Wealth Management, said:

Broadly, we attribute the yen move to a combination of risk-on trade in equity markets, rising headwinds for Japan’s economy, and continued US dollar strength. The move may have been exacerbated by other factors, from rising Covid – 35 infections in Japan to GPIF [Government Pension Investment Fund] outflows.

Updated (at 6.) am EST

(5) (AM) (EST) :

Some more reaction on the British retail sales rebound. It appears that experts aren’t quite convinced that the post-election bounce means the sector is out of the woods.

Kallum Pickering , senior economist at

Berenberg

, an investment bank, said:

One month does not make a trend. Retail sales are typically quite volatile. However, they do provide an early indicator of the much bigger category of household spending – which makes up about 95% of GDP.

So far, the data just show a rebound from the fourth quarter and not yet evidence of a strong gains to come throughout . However, the uptick in spending along with the sharp improvement in household survey data at the start of the year suits our call that real household consumption is on track to recover solidly in the first quarter ( 0.6% quarter-on-quarter) after the disappointing 0.1% gain in the fourth quarter of

Karen Johnson , head of retail and wholesale at

Barclays Corporate Banking , said:

Have UK consumers chosen ‘buy more big ticket items’ as their New Year’s resolution? Though UK retailers will certainly hope so, this will have required a real growth in consumer confidence. Last year was characterized by nervousness in the market, which led to muted spending and frustration for many businesses.

January’s ONS figures offer a glimmer of hope that this pent up consumer demand could now slowly be being released, but the jury is still out on this at the moment.

Joe Morris , retail partner at law firm

Gowling WLG

, said :

While promising, there is a need to remember the backdrop of this improvement, which has seen failures and insolvencies in the areas with the highest sales – both in terms of physical store footfall and a failure to successfully unify on and offline efforts into one seamless experience.

The need to meet these core customer needs will continue to challenge the sector, with global supply chain efficiencies also playing a key part. Survival of the fittest has never applied more, but as ever, retailers with strong brands and reactive and widely available lines will continue to do well.

(5.) (am) (EST) : 34

A just after mid-morning update on markets: the

FTSE has given up almost all of its gains to trade flat for the day.

The Euro Stoxx (index is down by 0.) %, with Italy’s Milan-based FTSE MIB index down by 0. (% amid political uncertainty.)

The pound has dropped by 0.3% against the US dollar to $ 1. 7546, its lowest in days, despite the rebound in UK retail sales.

(5.) am EST :

Here’s the full report on Lloyds Banking Group’s profits hit – and some bad news for its chief executive: he is no longer Britain’s best paid banking boss, as we earlier reported.

António Horta-Osório has seen his pay packet fall to a mere £ 4.7m, a (% cut.)

Horta-Osório, the chief executive, is now the second-highest paid UK bank boss, behind Barclays ’chief executive, Jes Staley. Staley was paid £ 5.9m for (despite UK regulators launching an) investigation over his links to the sex offender and disgraced financier Jeffrey Epstein in December. Horta

Horta-Osório’s pay peaked at £ 5m in 2890. Between and he has been paid £ m by the bank.

This year pay packet includes a £ , “car or car allowance” and a £ 50, “transportation”. That’s £ , for various forms of transport alone – about 1.7 times the average UK salary, which is roughly £ , 500 based on the Office for National Statistics’ weekly earnings figures.

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