Charlotte Street Partners

DAILY BRIEFING

DAILY BRIEFING

The case for space

Written by Katie Armour, senior associate 
Edited by Katie Stanton, associate partner
25 March 2021

Good morning,

When the US government passed the coronavirus relief package in January, an obscure committee amendment within it put a duty on the Pentagon to publish a report on UFO sightings within 180 days.
 
The motivation for this is spectacularly unclear but time is almost up. The unclassified report must be published by the start of June, and yesterday the former US national intelligence director John Ratcliffe said the findings would be “difficult to explain”.
 
Talking to Fox news, he claimed there were “a lot more sightings than have been made public”, including unknown items that had been travelling at speeds that “exceed the sound barrier without a sonic boom”. 
 
Conspiracy theorists worldwide will unite in their delight that so much new content is coming their way, but they’re not the only ones invested.
 
News on earth has been rather heavy of late and I can’t help thinking that’s maybe why so many governments are turning their attention to space.
 
Yesterday, it was Britain’s turn. A near £7bn commitment to “research, development and experimentation” in space was one of the centrepiece announcements of the Ministry of Defence’s new paper – Defence in a Competitive Age.
 
The strategy is the military contribution to Downing Street’s wider integrated review of defence, security and foreign policy. Defence Secretary Ben Wallace has said it will turn hollow forces into credible ones.  
 
It’s an £188bn plan that will see old tanks, warships and aircrafts retired and personnel numbers cut by 10,000 by 2025. It’s also a plan that points to some of our greatest weaknesses.
 
Billions will go to securing our “digital backbone”, investing in our surface and submarine fleet to protect an increasingly vital network of subsea cables, and the creation of a new surveillance satellite constellation.
 
Going through the details Wallace talked of technological proxies and proliferation. He said we needed to keep “adapting to the threat” and “protect new domains”.
 
Is this the biggest hint yet that the wars of the future will be set in space? Maybe so. But as the British Army contracts to levels smaller than the reserve force of the US Air Force, it’s right to question its continuing fitness to deal with more mundane threats back here on earth. Get that wrong and this review may well be branded a waste of space.

News

Nicola Sturgeon was cleared of breaching any of the provisions of the ministerial code in the independent inquiry into her involvement in the Alex Salmond saga. The report, led by James Hamilton QC, stated that the first minister had given an “incomplete narrative of events” to MSPs but concluded that was a “genuine failure of recollection” rather than deliberate. Scottish Conservative leader Douglas Ross voiced disagreement with Hamilton’s assessment and has said his party will continue with plans to hold a vote of no confidence in the first minister today.

The US, the UK and the EU moved as one unit yesterday in imposing sanctions on four Chinese officials over the treatment of the Uighur Muslims in Xinjiang. The four individuals are directly involved in the internment camp system. They will face travel bans and have overseas assets frozen. Beijing retaliated yesterday evening stating that the measures were “based on nothing but lies and disinformation” and stressing that the sanctions would “severely” undermine their ties with the European bloc. (£)

Boris Johnson has warned that the third wave of coronavirus currently causing great damage across parts of the EU “will affect us too”. He stressed that Brits should be “under no illusion” that it would “wash up on our shores as well”. The overseas travel ban has been extended until July due to third wave fears and people who attempt to leave the country will face £5,000 fines. (£)

Business and economy

New figures from HMRC have shed light on the collapse of UK food and drink exports post-Brexit. Whisky, cheese and chocolate producers have suffered most dramatically. The combination of Brexit and the closure of hospitality outlets in Europe meant chocolate exports declined by 68%. The department for environment, food and rural affairs blamed the collapse on a “unique combination of factors” but stressed that overall freight volumes were “back to normal levels since the start of February”.

A new report by researchers at Legal & General and Demos has suggested that a hybrid model of remote and office working post-pandemic could revive local economies. The study argues that hybrid working has created more opportunities in rural areas and could “turbocharge” hopes for regional growth and regeneration. (£)

Columns of note

James Kynge sets out in the FT how and why he thinks western distrust of Beijing grows as digital trade expands. He notes how British intelligence agencies are eager to curb the use of Chinese smart city technologies by local authorities in case they are deployed for surveillance, but at the same time highlights China’s role as a global innovator, pointing out that the patent awards to Chinese companies by the European patent office grew by 10% in 2020, faster than any other major economy. (£)
 
Simon Jenkins argues in The Guardian that David Cameron’s lobbying on behalf of Greensill should be investigated as part of a wider investigation into cronyism and covid contracts. He suggests the lack of accountability around the pandemic procurement process is a “financial outrage” and should form one strand of the eventual inquiry.

Cartoon source: The Times

Markets

What happened yesterday?

London stocks closed positively on Monday, but gains were limited as a result of the ongoing vaccine tension between the UK and the EU and the rising number of Covid-19 cases across Europe.

The FTSE 100 ended the session up 0.26% at 6,726.10 and the FTSE 250 was up 0.17% at 21,455.89. Sterling was stronger as well, gaining 0.08% against the dollar at $1.39. It also rose by 0.33% against the euro, to €1.16.

The Dow Jones industrial average was up 0.32% at close at 32,731.21, the S&P 500 was up 0.70% to 3,940.59 and the Nasdaq Composite grew by 1.23% to 13,375.54.

In company news:

Kingfisher, the owner of B&Q, saw its stock price rise by 3.61% after reporting soaring annual profits and announcing it would reinstate its dividend. The success was pinned on a “new generation of DIYers” spurred on by the pandemic.

Astrazeneca rose by 3.29% after a US trial showed the vaccine was 79% effective at preventing symptomatic coronavirus.

British Airways and Iberia’s parent firm IAG dropped 5.2%.

What’s happening today?

Finals
Alliance Pharma
Arrow Global
Cambridge Cog
Dp Eurasia
Elementis
Energean Oil & Gas
Ergomed
H&t Group Plc
Henry Boot
Judges Scientfc
Longboat Energy
Loopup Group
Luceco
M.p. Evans
Mortgage Ad
Old Mutual Lim.
Personal Group
The Pebble Gro.
Zotefoams

Interims
Essensys
Mj Hudson Grp
YouGov

AGMs
Bankmuscat Regs
Blackrock Brna
Crest Nicholson
Std Life Priv.
Wynnstay

EGMs
Uk Mortgages

Final Dividend Payment Date
Driver Grp

Interim Dividend Payment Date
BHP Group

UK economic announcements
(07:00) Unemployment Rate
(07:00) Claimant Count Rate

Int. economic announcements
(15:00) New Homes Sales (US)

Source: Financial Times

did you know

Around 300,000 cubic metres of lava have poured out of Mount Fagradalsfjall in Iceland since it started erupting last Friday. (Source: BBC)

Parliamentary highlights

House of Commons

Oral Questions
Business, energy and industrial strategy

Ministerial Statement
Future defence and security industrial strategy

Ten Minute Rule Motion
First-Aid (Mental Health)

Legislation
Advanced Research and Invention Agency Bill: Second reading

Programme Motion
Advanced Research and Invention Agency Bill

Money Resolution
Advanced Research and Invention Agency Bill

Adjournment
Automatic number plate recognition and width restrictions

Westminster Hall Debate
Government-backed insurance for live events
Reduced-risk smoking products and proposals for a smokefree society by 2030
Proposal for an outer London congestion charge
550th anniversary of the Battle of Barnet 1471
Improving the education system after the covid-19 outbreak

House of Lords 

Oral Questions
Findings of the government consultation on the proposal to add folic acid to flour
Enabling children who commit offences to be tried and sentenced according to the youth justice system
Removing anonymity from persons who post racist and grossly offensive material attacking public figures
Government proposals in ‘restoring trust in audit and corporate governance’

Statement
Human rights update

Legislation
Trade Bill – consideration of Commons amendments

Orders and regulations
Registration of marriages regulations 2021
Extradition Act 2003 (Codes of Practice and Transit Code of Practice) Order 2021
Renewables Obligation (Amendment) Order 2021

Statement
Integrated review: Defence command paper

Scottish Parliament 

Parliamentary Bureau Motions
 
First Minister’s Statement
Covid-19 reflections and next steps
 
Topical Questions
 
Ministerial Statement
Implications of the administration of Greensill Capital UK for businesses in Scotland
 
Stage 3 Proceedings
European Charter of Local Self-Government (Incorporation) (Scotland) Bill
 
Stage 3 Proceedings
Tied Pubs (Scotland) Bill
 
Members’ Business Debate
Stories of Hope report, Scottish churches provide support in lockdown

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