Today's business and finance round up 27th July 2021

View this email in your browser

27th July 2021

Good morning It probably won’t come as a surprise but a survey suggests more than 40% of adults in England have gained weight during the pandemic, with the average gain being around 3kg or half a stone. Public Health England have kicked off a campaign to get the country back in shape for the summer. As the saying goes “sun’s out, guns out”.

Today's stories

• Amazon’s job ad sends Bitcoin higher

• Mixed futures for UK challenger banks

Yesterday's market moves

FTSE 100  0.0%    7,025 FTSE 250  +0.2%   22,933

UK markets started the week in a muted fashion, barely budging. Airlines were in demand after The Times reported that the UK may drop quarantine requirements on travel from France next week because the spread of the Beta variant has been contained. In the US, the big focus this week is on Big Tech, with Amazon, Google, Apple, Facebook, Microsoft, Paypal and Tesla all due to report. Together they speak for 24% of the S&P 500 and 45% of the Nasdaq. And together, they could determine whether markets push higher still or come off the boil.

CRYPTOAmazon’s job ad sends Bitcoin higher What’s going on?Amazon has used the untraditional route of posting a job ad to hint at its plans to accept Bitcoin payments in the future.Over the weekend the ecommerce giant published a job vacancy for a cryptocurrency and blockchain lead.Speculation over this hiring sent Bitcoin and other cryptocurrencies 10% higher.Why is this important?

Amazon is looking for someone who can “leverage domain expertise in blockchain, distributed ledger, central bank digital currencies and cryptocurrency”.Digital currencies have had a tough time lately with regulatory crackdowns in China and growing concerns on their environmental impact, taking the shine off their valuations.Tesla CEO, Elon Musk, also sent the crypto market into a tailspin in May when he announced his company would no longer accept Bitcoin as payment again over environmental concerns.Acceptance by Amazon could be gamechanger for the digital currency sector. At the moment very few companies accept Bitcoin and other cryptocurrencies as payment. Amazon presents a huge opportunity – it stocks hundreds of thousands of items, has millions of customers, and generated sales of nearly $400bn last year.

TakeawayBitcoin may be increasingly popular with Millennial and Gen Z investors but recent actions taken by China to curb its usage has raised doubt over its long-term adoption by wider society. It’s also very susceptible to wild swings in value, this gives further ammunition to critics who say cryptocurrencies are too volatile and have no intrinsic value.

FINTECHMixed futures for UK challenger banks

Just a few years ago, supermarkets adding financial services was all the rage. In the wake of the Global Financial Crisis in 2008-9, consumer trust in banks were at a low, this led to many grocers entering the financial services sector to challenge traditional high street banks.Tesco, M&S and Sainsbury’s, started offering a wide range of products including current accounts, mortgages and loans. But this trend seems to be coming to an end. Yesterday Tesco announced that it will close all 213,000 of its current accounts as it estimates that only about 12% are being used as main bank accounts.It follows M&S, who revealed earlier in the year that it too would close its current accounts in August.Tesco’s announcement came on the same day as news of expansion emerged for two British digital challenger banks. Starling, the banking app for personal and business accounts, announced its first acquisition – buy-to-let mortgage specialist, Fleet Mortgages. The deal, worth £50m, is part of the company’s plan to expand into lending. Sky News reported that Zopa, the digital bank known for pioneering peer-to-peer lending, was in talks with investors over a possible £100m cash injection. The company is rumoured to have hired investment bank JP Morgan to advise on funding which could pave the way for a public market listing in the next couple of years. 

Stat of the day

Mark Zuckerberg spends $23m a year on personal security. Jeff Bezos spends £1.6m and Apple’s Tim Cook spends $470k.

Other stories to keep you in the loop

• Ryanair forecasts 100m passengers in financial year as bookings soar

• Burger King UK owner puts sale on the table

• Selfridges for sale: Iconic department store goes on market for £4bn

• Air travel yet to meaningfully restart, says UK industry

• China’s nuclear power firm could be blocked from UK projects

• Armani sales bounce back in pandemic rebound

Forward to Friend