Good morning. Happy New Year and welcome back to Market Loop!
If you’ve been avoiding the news for the past couple of weeks, don’t stress – today’s issue will get you caught up on the big business and finance stories you might have missed during the festivities.
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British rail workers will be on strike for much of this week, paralyzing transport and adding to the troubles piling up for Rishi Sunak’s government. The walkouts will hamper the usual return to work following the Christmas holidays and interrupt January sales that are crucial for retailers.
Later this month, nurses and ambulance workers are planning strikes, even as flu and Covid outbreaks place huge pressure on the NHS. The protests stem from growing anger over wage increases not matching 40-year high inflation of 11%. So far Sunak has stood firm with the rationale that double digit pay rises will only make inflation worse.
Strikes are one of a series of headaches for Brits with 2023 forecast to be a year of recession alongside the rising cost of living and higher borrowing costs.
Meanwhile yesterday the prime minister outlined 5 “people’s promises” which he says should serve as the evaluation criteria for the success (or otherwise) of his government. Namely: grow the economy, halve inflation, end illegal immigration via boats across the channel, cut NHS waiting lists and reduce public debt.
Tesla falls short
Tesla delivered fewer vehicles than analysts expected last quarter, missing estimates despite taking the unusual step of offering big incentives in the US and China - its two biggest markets. The company sold 405,000 vehicles in the last three months, short of the 421,000 expected by the market. While the total was a quarterly record for Tesla, the company opened two new assembly plants last year and still came up short of its goal to expand deliveries by 50%. Tesla’s quarterly delivery figures are widely seen as a gauge of demand in the overall electric vehicle market, since the Texas-based company has led the charge for battery-powered cars.
Sam Bankman-Fried, the disgraced founder of collapsed crypto exchange FTX, pleaded not guilty to criminal charges in a New York court on Tuesday. The 30-year-old, once said to be worth $27bn, was extradited from the Bahamas in December then released on a $250m bail. He’s accused of using billions of FTX customer money to cover losses at his separate investment firm, Alameda Research. Two of SBF’s former colleagues pleaded guilty in December as they opted to cooperate with prosecutors. The trial is set to begin in October and is likely to be one of the highest-profile financial fraud cases in recent history. If found guilty he faces up to 115 years in prison.
China opens up
After three years of strict zero-Covid policies, China abruptly rolled back almost all of its health and travel restrictions in an effort to quell growing public dissent over lockdowns and boost its slowing economy. Since then, infections have skyrocketed, swamping the country’s hospitals. Some models predict over a million Covid-related deaths in China this year, and many nations - including the UK - have imposed testing requirements on travellers from the country.
Housing market wobble: Mortgage approvals fell to their lowest level in two years as interest rate rises put off buyers, new Bank of England figures suggest.
Raising the wage: Sainsbury’s is giving its lowest-paid workers their third pay rise in a year, taking hourly wages to at least £11.
Staying public: Plans to privatise Channel 4 could be scrapped, according to reports.
Un-made: More than 30,000 customers of collapsed furniture site Made.com face losing £11.9m in deposits on purchases.
Cutting back: Hundreds of London tech jobs could be at risk after software business Salesforce said it would be making a wave of redundancies as part of efforts to cut costs.
Walking out: Amazon UK staff in the Coventry warehouse are set to walk out on 25 January in a pay dispute according to their union.
Unionising: A group of video game testers is forming Microsoft's first labour union in the US, which will also be the largest in the video game industry.
Fact Of The Day
This week Croatia adopted the euro as its currency and became the 27th country to join the European Union's border-free Schengen zone, which allows people to travel freely without border controls.