The world economy faces up to the likelihood of no Brexit deal, Plus another chief executive leaves a leading NZ business
BUSINESS & INVESTING WRAP:
* Markets flatline, absorbing perilous state of Europe
* Michael Hill Jeweller regains some shine
* NZX boss stays; Lion boss goes
* Chinese Airline cabin crews told to wear nappies
Markets in New Zealand, and around the world, will today be digesting the news a last minute Brexit deal looks increasingly unlikely.
Boris Johnson’s dash to Brussels to have dinner with EU Chief, Ursula Von der Leyen, aimed at breaking the deadlock has come to nothing.
Downing Street said, “very large gaps remain” and Von der Leyen confirmed the two sides were still “far apart.”
The BBC reported that the evening had “plainly gone badly” and although talks between negotiators for the two sides will continue, there appears be only a slim chance that a deal will be done before the end of the year.
The UK stops following the EU trading rules on December 31.
Von der Leyen said the dinner discussions had been “lively and interesting” but there remained major differences over fishing rights, business competition rules and how any deal would be policed.
Markets flatlining
European markets remained flat as investors absorbed the perilous state of the talks.
Australia and New Zealand sharemarkets dropped back slightly after their strong recent runs.
The NZX 50 Index was down 29 points or 0.2 percent to close at 12,860.37 on Thursday.
The excitement generated by AustralianSuper’s hostile bid for Infratil fell away with some investors deciding to take the gains and run. Infratil was down 7c to $7.18 after its 20 percent jump on Wednesday and associated stock Tilt Renewables, dropped 8.5 percent to $5.12.
The Australian Market also took a breather after 8 days of consecutive rises. The ASX200 fell 0.7 percent. Tech stocks were the worst performers, dropping a collective 2 percent but gold miners and travel firms were also down.
Michael Hill Jeweller regains some shine
Dual listed stock Michael Hill International’s trading update showed it was bouncing back strongly after Covid-19 lockdowns.
The jeweller managed same store sales growth of 7.9 percent for the 22 weeks ending November 29. Sales in Oct/Nov were even stronger with growth of 8.5 percent. Online sales doubled, while margins improved significantly.
The situation with its Canadian business is not quite so rosy. Due to provincial requirements, 14 Canadian stores are temporarily closed, and could remain closed through December, due to Covid-19 lockdowns.
On the NZX, Michael Hill shares were up 6c or 10.53 per cent to 63c.
One stays, one goes
The last weeks before Christmas often see the boards of major companies announce executive reshuffles.
The NZX board has decided to extend its chief executive Mark Peterson’s contract to April 2024.
Peterson was appointed CEO in April 2017, with an initial employment term of five years and an option to extend for a further two years. NZX said the desire for stability in leadership and maintenance of strong momentum in the business were key reasons for extending Peterson’s term.
Rory Glass, the long-serving boss of Lion NZ says he will leave the liquor company in February next year. Glass has been at Lion for 20 years, the past ten as managing director.
The company told the NZ Herald that it no longer requires a managing director and has appointed Craig Baldie, Lion’s commercial director, as its local country manager, common among multinationals.
Lion, owned by Japanese brewer Kirin, has undergone extensive restructuring in the past year and will now be run mainly from Australia.
Chinese Airline cabin crews told to wear nappies.
In one of the more bizarre bits of advice to come from a regulator, China’s aviation authorities have recommended cabin crew on charter flights to high-risk Covid-19 countries wear disposable nappies.
Crew members wearing the nappies would then be able to avoid using aircraft toilets and reduce the risk of infection.Bloomberg reports the advice is part of a 38-page list of guidelines to avoid the spread of coronavirus.
The civil aviation regulator says the recommendation applies to flights to and from countries where infections exceed 500 in every one million people.
Cabin crew are also advised to wear medical protective masks, double-layer disposable rubber gloves, goggles, disposable caps, disposable protective clothing and disposable shoe covers.
Pilots should wear masks and googles but not nappies.
