Brexit

07 Jun 2018

Brexit back on the boil

There have been a number of Brexit headlines across the wires yesterday, which do not make for encouraging reading on progress.

Primarily the focus is around the government’s backstop plan for Northern Ireland, a so called Temporary Customs Arrangement (TCA), which PM May had been planning to send to Brussels this Friday. The TCA is set to be published later today, ahead of the Brexit war cabinet meeting. It effectively revolves around a plan to remain part of a Customs Union with the EU for a ‘time limited’ period, whilst a solution is sought over the Northern Ireland Border. However the draft proposal has drawn the ire of Brexit Secretary David Davis, who is reportedly furious over the lack of a definite end date to the UK’s membership of a Customs Union, equally the news will not go down well with those Eurosceptics members of the Tory Party. In more Brexit news, Bloomberg broke a story yesterday that some 12 rebel conservatives have signed a paper demanding that the UK remains in the EU’s single market, in essence aligning themselves with the brand new Brexit strategy of the main opposition party, Labour. Therefore it could be a testy few days for the UK government, with the publication of the CTA and the Brexit war cabinet today and the return of the EU Withdrawal Bill to the Commons next Tuesday.
 

US trade update
 

After telling the press that President Trump will hold side meetings with Canada and France during the upcoming G& summit, White House economic adviser, Larry Kudlow, was playing the peacemaker yesterday as he referred to the heightened tensions between the US and its G7 counterparts as a ‘family quarrel’.  It has also come to light that President Trump has had meetings with over a dozen Republican Senators in recent days in order to halt some proposed legislation that may require him to seek Congressional sign off  before any tarrifs are approved.
 

Oil settles at two month lows
 

Oil prices seem to be taking on more of a consolidative tone for now, with the market likely to opt to sit on its hands until the June OPEC meeting is out of the way. Brent crude front month bounced off of its lows yesterday to close pretty much flat on the session, while in overnight trade it has held within the prior session’s trading range. At $75.84/bbl. the price is sitting nearly 6% lower than year-to-date highs, but still around 23% on a year-to-date basis. The driver of the recent selloff seems to have been unofficial reports that the US has requested that OPEC raise oil output by around 1 million barrels a day, which just so happens to be roughly the amount that will be taken out of the market due to sanctions on Iran. In this context, the June 20-21 OPEC meeting is likely to be a major focal point, with the supply situation generally supporting higher prices.
 

Kingspan: NCI Building Systems Q2 results
 

NCI Building Systems has reported Q2 figures. The company reported adj. EPS per share of 25c and total revenue for the quarter of $457.1m. Q3 company guidance for Q3 sales is now $525m to $545m v’s previous consensus of $503.8m. NCI, the second largest manufacturer of insulated metal panels in the US reported +10.2% Q2 growth in panel sales yoy ($113.4m v $102.9m). Adjusted operating income for the segment was $8.4m compared to $10.9m in the prior year. The company noted it was a period of rising input costs but attributed the fall in underlying margin to an “unusually large amount of higher margin architectural panels shipped in the prior year quarter”.
 

Origin Enterprises: New CFO appointed
 

Origin Enterprises has announced the appointment of Sean Coyle as CFO. He will take up his position on 1 September and be co-opted to the board on 1 October. Coyle is currently Group FD of UDG Healthcare plc, having previously served as MD of the group’s Healthcare Supply Chain Division. Before joining UDG Coyle was CFO at Aer Lingus and had also held senior roles at Ryanair. He qualified as a Chartered Accountant with KPMG.
 

Economic releases
 

10.00 EC GDP

13.30 US Initial Jobless Claims

16.00 UK BoE’s Ramsden speaks