Marketing Newscast

Chancellor Rachel Reeves’ attempts to grow the economy through tax hikes are “unlikely to succeed” and more likely to “end in failure,” according to analysts at Oxford Economics. A report authored by Edward Allenby and Adam Slater collated evidence from a range of attempts by other governments to balance their budget deficits and concluded: “A number of studies suggest that fiscal adjustments centred on expenditure reductions, rather than revenue increases, have a better chance of success”. “The failure rate for adjustments based on revenue raising is high, given the risk of dampening growth prospects without yielding material improvements to the public finances,” they added, concluding that “prospects for the success of the UK’s fiscal adjustment programme look unpromising.” Allenby and Slater also warned that the split between spending cuts and higher taxes was “similar to that seen in unsuccessful adjustments,” where countries failed to narrow their budget deficits.

Corporate landlords are expected to deliver as much as a quarter of homes in each of Labour’s 12 new towns, which will each have at least 10,000 properties, The Telegraph reports. Deputy Prime Minister Angela Rayner is heading up a task force that is reviewing more than 100 potential sites. However, Marcus Dixon, head of residential research at JLL consultants, estimates that in every new town, around 2,500 homes will be build-to-rent properties managed by big institutional landlords. “These aren’t going to be towns exclusively of homeowners,” he told the newspaper. Richard Berridge, founder of Blackbird Real Estate Advisory, added investors will be “queuing up” to develop the homes as soon as the locations are announced, and that he said he has spoken to at least 15 build-to-rent investors who have expressed an interest in the new towns. A Housing Department spokesman said: “This Government inherited the worst housing crisis in living memory, which is why we are taking urgent action to overhaul the planning system and deliver 1.5m new homes as part of our Plan for Change. Our new towns will deliver thousands of new houses of all types, including homes to buy and rent”.

London is Europe’s fintech ‘unicorn’ capital, according to the latest European “unicorn and soonicorn report” produced by global research firm Hurun, which says nearly 80% of the UK’s unicorns and future unicorns are based in London. A ‘unicorn’ is the name given to privately-held startups valued at over $1bn. Of the 137 British companies included in the report, 52 operate in the fintech space, making it the best-represented industry in the UK’s unicorn landscape. This includes the UK’s highest-valued fintech unicorn, Revolut, which is now worth $45bn (£36bn) and has 18m users. Together the UK and Ireland have produced the most valuable unicorns in Europe, making up 38% of the continent’s entire unicorn value, Hurun concluded.

More gloomy jobs news: permanent placements made by recruitment firms fell for the sixth consecutive month in January, according to a survey from KPMG and the Recruitment and Employment Confederation (REC). The permanent placements index stood at 42.9 last month, well below the 50 mark which separates growth from contraction. The index for temporary roles in the capital fell to 38.6, its lowest level since April 2024.

Train drivers on London’s Elizabeth Line are to strike for 24hrs 27^th February, and on the 1st, 8th and 10th of March. 95% of members of the Aslef trade union on an 88% turnout voted to strike after rejected a 4.5% pay rise.

Thames Water has launched an appeal against regulator Ofwat’s decision to cap price increases at 35% over the next five years, saying it needs to raise more money from customers to cover the costs of investing in water infrastructure. Thames, which provides water services in the south-east of England, and is the UK’s largest water utility, said the appeal was "in the interests of our customers and the environment". Thames is already heavily in debt and seeking a green light from the courts to move forward with a £3bn rescue package from investors to avoid potential renationalisation.

Barclays is under investigation regarding anti-money laundering rules. The bank has confirmed the Financial Conduct Authority (FCA) was examining whether financial controls at its UK division had been too lax. “Barclays has been co-operating with the investigation,” it said. The FCA has declined to comment. The bank has also revealed it has put £90m to cover potential motor finance mis-selling payouts, amidst ongoing disputes following the landmark Court of Appeal ruling in October last year that found in favour of three customer that lenders were liable for paying undisclosed commission to car dealers who acted as credit brokers.

Unilever has confirmed it will spin off its ice cream business, and list it in Amsterdam. The FTSE 100 firm denied, however, that the decision is a snub to the UK, saying it will also launch secondary listings in London and New York. The Ben & Jerry's maker expects the division to float with an expected value of between €10bn and €15bn (£8.33bn and £12.49bn). Unilever’s ice cream business, which includes the Magnum and Wall’s brands, turned over €8.3bn (£6.91bn) in 2024.

Activist investor Elliott Management has taken up a £3.8bn stake in BP, becoming the oil giant’s ’s third-largest shareholder, it has been reported. It was revealed the hedge fund had taken a significant stake in the business on Tuesday.

FTSE 250 Waste management firm Renewi has agreed to be bought by Australian investment firm Macquarie Asset Management in a £707m deal.

Footwear and accessories brand Kurt Geiger is to be sold by current private equity owners Cinven to shoe brand Steve Madden for £289m. Cinven bought Kurt Geiger in 2015 for £245m, and has since expanded the business in the US. In December, it announced record growth of 17%, credited to a 54% rise in handbag sales and its US expansion.

The takeover of Learning Technologies Group (LTG) by Leopard UK Bidco (set up by US private equity investor General Atlantic) has received all regulatory clearances. The UK Government has confirmed it will take no further action under the National Security and Investment Act and the deal is now subject only to court approval, which is expected in late March. The firm said AIM-listed LTG shares would be suspended from trading on 31^st March, and the firm will be delisted on 1^st April. The workplace digital training provider agreed to be taken over in the £707m deal in December last year after being hit by "challenging" conditions.

NatWest has beaten annual profit expectations after growing its loan book and pulling in more deposits with an increase in customers. Pre-tax operating profit rose 0.3% to £6.2bn in the 12 months to 31^st December 2024 compared with estimates of £6.1bn. The bank said in its update that it could see the UK government sell the remainer of its 7% stake this year, after an attempt to do so in 2024 fell through.

Bloomberg and the Financial Times report that HSBC will initiate a fresh round of layoffs at its investment bank as early as Monday, with the first cuts carried out in Asia before being expanded to the rest of the lender's staff. The number of redundancies was not clear. The attempt to make $1,5bn in savings will largely result from HSBC’s decision to withdraw from non-core markets, the media outlets report. The bank confirmed last month it will wind down parts of its investment banking operations across the UK, Europe and North America as part of sweeping global restructuring plans, reorganising into four new divisions and splitting its businesses into Eastern and Western geographical camps. The London-based lender has already laid off scores of senior bankers and is expected to cull over 40% of its top 175 managers.

Warehousing giant Segro has reported a double-digit jump in profit driven by demand for data centres and improving investment market conditions. Adjusted profit before tax at the FTSE-100 real estate investment trust (REIT) grew 14.9% in the year ended 31^st December 2024 to £470m, after the company generated £91m of new rent, including a 43% uplift from UK rent reviews and renewals.