Today's business and finance round up 1st November 2021
🌎High stakes at COP26
1st November 2021
Good morning This weekend featured a double whammy of global summits. On Friday leaders from the 20 biggest economies aka G20 met in Rome. Then they travelled to Glasgow yesterday, joining delegates from 200 countries, for the much-anticipated environmental summit COP26 which we dive into below.
High stakes at COP26 Apple and Amazon earnings disappoint
ENVIRONMENTHigh stakes at COP26
What’s going on?25,000 officials, including world leaders, from almost every country in the world have gathered in Glasgow for the 2021 UN climate change conference aka Conference of Parties or COP26.
Why is this important?
“Moment of truth”, “world’s best last chance” and “last chance saloon” are just some of the stark warnings that’s been used to describe the next two weeks of climate talks between 200 countries.Back story: The first COP was in 1995 and led to the legally binding agreement to limit greenhouse gas emissions known as the Kyoto Protocol. The aim was to stop the damaging effects of climate change on the environment.The last conference, COP21, took place in Paris in 2015. There every country agreed to work together to limit global warming to below 2C and aim for 1.5C, to minimise the impacts of climate change. Following this agreement was countries agreed to reconvene in five years to revisit progress and make it stronger. Last year, however, it was postponed because of the pandemic. So how has the world done? Not that well, hence the narrative that COP26 is “make or break”. Scientists say that the last five years have been the hottest on record. Emissions are forecast to increase by 16% by 2030 but the world needs a 45% reduction by 2030 and to reach net zero by 2050 to keep temperatures below the 1.5C increase.What’s on the agenda? Discussions will focus on agreeing ambitious targets to cut emissions and reach carbon neutrality by the middle of the century. However, a new UN-backed climate report said countries’ plans to keep producing fossil fuels means they’re “dangerously out of sync” with the Paris target.TakeawayAfter 25 environmental conferences, the planet is now 1C hotter than the pre-industrial level - and rising. So could it be 26th time lucky?
TECHApple and Amazon earnings disappoint
Last week Amazon and Apple, two of the biggest names in tech, reported results for the three months to September that fell below market expectations.Amazon reported revenues of $111bn up 15% in the quarter but much lower than the 37% increase from the same period in 2020.The slowdown in growth was driven by consumers slowly returning to shopping in person and away from online. Like many companies Amazon is also facing serious headwinds from clogged up supply chains and labour shortages.Amazon intends to combat these issues by investing heavily in its delivery network, hiring 275,000 workers with incentives like $3,000 signing bonuses and free university tuition. All of which is likely to dent profits.The last three months of the year will be crucial for Amazon as it includes Black Friday and Christmas. But the company expects sales to slow even more as customers opt for physical stores over online. Apple revenue rose 29% to $83bn, below the $85bn expected by analysts, the first time it has failed to beat expectations since 2017.The company said it lost $6bn due to supply issues in the quarter. The global shortage of microchips and the Covid-related closures of factories in Southeast Asia delayed the production of iPhones, iPads and Macs. Looking ahead Apple expects that chip supply issues will continue to impact sales going into the festive season. Apple’s shares fell 5% following the announcement which meant it gave up it’s spot as the world’s most valuable company to Microsoft.
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