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M&S boss urges chancellor not to ‘slap more taxes on everyday economy’![\"Sarah](\"https:\/\/www.newsbeep.com\/au\/wp-content\/uploads\/2025\/11\/Sarah_Butler_Next_Gen.png\")
Sarah Butler<\/p>\n
Marks & Spencer boss Stuart Machin said Rachel Reeves\u2019 speech yesterday has only made his customers more worried about rising taxes, as he called on the chancellor not to slap \u201cmore taxes on everyday economy, that wouldn\u2019t be a growth strategy\u201d.<\/p>\n
Speaking to journalists after the retailer reported a halving in half-year profits<\/a>, Machin expressed frustration about the delayed budget, saying \u201cwe are all waiting for the 26th\u201d with \u201cplanning for the worst with the budget and hoping for the best\u201d.<\/p>\n The chancellor will present her budget on 26 November, a month later than usual.<\/p>\n In a speech yesterday, she refused to rule out tax rises, insisting she must \u201cdeal with the world as I find it, not the world as I might wish it to be\u201d.<\/p>\n Reeves foreshadowed an income tax increase, a breach of Labour\u2019s manifesto commitment, as a result of the public finances being in a worse state than expected after \u201cyears of economic mismanagement\u201d.<\/p>\n Machin said clothing is having a tough time \u2013 partly because of ongoing issues related to the cyber-attack in April, which hit M&S sales hard, but also the warm autumn.<\/p>\n Marks and Spencer’s profits have more than halved after it took a hit from a major cyber-attack earlier this year that saw online home and fashion sales plunge more than 40% when it was forced to halt website orders for more than six weeks. Photograph: Mike Egerton\/PAShare<\/a><\/p>\n Updated at\u00a005.22 EST<\/p>\n UK watchdog extends consultation on \u00a311bn car loans compensation scheme The Financial Conduct Authority has extended its consultation on the \u00a311bn compensation scheme over the loan scandal, in a move that notably pushes the deadline onto the other side of the UK\u2019s crucial autumn budget. <\/p>\n It comes after lenders and consumer groups said they needed more time to analyse extensive market data, with the main consultation paper alone running more than 300 pages long. The deadline has now been pushed from 18 November to 12 December. <\/p>\n While an extended deadline might not sound exciting on its own, it could end up providing a bargaining chip for banks like Lloyds, Barclays and Santander UK, as the Treasury considers whether to hike taxes on the banking sector in order to strengthen the public finances. <\/p>\n Last week, banking analyst John Cronin of Seapoint Insights, wrote:<\/p>\n If the Treasury\u2019s consultation in a motor finance redress scheme context is extended, this may well give the Chancellor pause for thought before lashing more taxes onto the sector.<\/p>\n He added:<\/p>\n Indeed, it might suit the banks for the argument to be drawn out in a bank taxes context, because if the consultation is still open at the stage of the Budget, Reeves will be presumably in a bind as regards what to do.<\/p>\n The FCA said it still expects to publish final rules in early 2026, saying it will now be either February or March.<\/p>\n Share<\/a>Bitcoin dips below $100,000<\/p>\n Bitcoin dipped below $100,000 for the first time since June, but is now back up above that level.<\/p>\n The world\u2019s best-known cryptocurrency is currently trading 1.7% higher at $101,985. This is a long way from the $125,835.92 record high<\/a> hit in early October, when investors were piling into bitcoin, gold and government debt in what was dubbed the \u201cdebasement trade\u201d.<\/p>\n Share<\/a>European stock markets fall more modestly after Asia sell-off<\/p>\n Following the sell-off in Asia, European stock indices have fallen more modestly.<\/p>\n The FTSE 100 index in London has slipped by 0.1%, falling to 9,703. The Dax in Frankfurt and the Ibex in Madrid both lost nearly 0.8% while the CAC in Paris and the FTSE MiB in Milan are both down by 0.3%.<\/p>\n \u201cGlobal equity markets faced a heavy selloff on Tuesday as a cumulation of several factors have led to a rise in uncertainty and risk aversion,\u201d said Daniela Hathorn, senior market analyst at Capital.com.<\/p>\n Today, Asia kicked off the session with another round of selling pressure but the majors have been able to claw back throughout the day, leading to a more stable open in Europe. With the market\u2019s usual data feeds on pause due to the US government shutdown, investors are increasingly reliant on less predictable signals and commentary. That vacuum has heightened sensitivity to policy communication and elevated fears about how long economic and earnings momentum can hold without fresh supporting evidence.<\/p>\n The tech sector, which has been the key powerhouse behind the rally this year, was dragged down by a sharp selloff in Palantir after releasing its earnings, despite reporting a stellar quarter and improving its forward guidance. This momentum shows how investors are starting to question whether these lofty valuations need more than just good earnings to keep them going, leaving the wider equity space exposed to continued downside given the narrow breadth of the current market.<\/p>\n Compounding this data gap is a growing concern that global economic growth may be softening, with a soft PMI reading in the US adding fuel to the fire. At a time when markets have continuously been breaking record highs, modest disappointments or ambiguous indications from macro or corporate fronts are enough to trigger outsized reactions. The Federal Reserve\u2019s unwillingness to commit to further rate cuts at last week\u2019s meeting has been a clear example of that.<\/p>\n Overall, the AI-investment boom that has fuelled the rally in 2025 has created exceptionally high expectations for continued earnings growth, but recent signs of cooling demand, rising costs, and tighter policy conditions have prompted investors to question whether those valuations are still justified.<\/p>\n Share<\/a>China bans foreign AI chips from state-funded data centres \u2013 report<\/p>\n The Chinese government has issued guidance requiring new data centre projects that have received any state funds to only use domestically-made artificial intelligence chips, Reuters reported, citing two unnamed sources.<\/p>\n In recent weeks, Chinese regulatory authorities have ordered data centres that are less than 30% complete to remove all installed foreign chips, and to cancel any plans to purchase them. Projects that are at a more advanced stage will be decided on a case-by-case basis.<\/p>\n It looks like one of China\u2019s most aggressive steps yet to eliminate foreign technology from its critical infrastructure, and become self-sufficient in AI chips. It comes as trade tensions between Washington and Beijing, have eased, after a high-stakes meeting between the two presidents, Donald Trump and Xi Jinping, in South Korea last week.<\/p>\n China\u2019s access to advanced AI chips such as those made by US chipmaker Nvidia, has been a key source of friction with the US, as the two countries battle for dominance in high-end computing power and artificial intelligence. Other foreign chipmakers that sell data centre chips to China include AMD and Intel.<\/p>\n Trump said on Sunday that Washington will \u201clet them deal with Nvidia but not in terms of the most advanced\u201d chips.<\/p>\n People visit a Huawei booth during the World Artificial Intelligence Conference in Shanghai on 26 July. Photograph: Go Nakamura\/Reuters<\/p>\n The latest move by Beijing would dash Nvidia\u2019s hopes of regaining Chinese market share, while giving local rivals, including Huawei, another opportunity to secure more chip sales.<\/p>\n It is unclear whether the guidance applies nationwide or only to certain provinces, Reuters said. It covers Nvidia\u2019s H20 chips, the most advanced AI chip the US firm is allowed to sell to China, but also more powerful processors such as the B200 and H200. While the B200 and H200 are barred from being shipped to China by US export controls, they remain widely available in China through grey-market channels.<\/p>\n AI data centre projects in China have drawn over $100bn in state funding since 2021, according to a Reuters review of government tenders. Most data centres in China have received some form of state funding to help with their construction.<\/p>\n Nvidia chief executive Jensen Huang has repeatedly lobbied the Trump administration to allow the sale of more AI chips to China, arguing that keeping its superpower rival\u2019s AI industry dependent on US hardware is good for America\u2019s interests. Its current share of the Chinese AI chip market is zero, compared to 95% in 2022, according to the company.<\/p>\n Share<\/a><\/p>\n David Morrison, senior market analyst at Trade Nation, took a look at recent AI investments yesterday.<\/p>\n It looks as if traders are finally booking some profits following the strong gains seen since late April as equities bounced back following the \u2018Trump Tariff Temper Tantrum\u2019. All the major US stock indices had been marking time over the past week or so, trading just south of all-time highs hit in late October.<\/p>\n Once again, [on Monday] news of a large investment in artificial general intelligence lifted tech. OpenAI, the privately owned owner of ChatGPT, announced a $38bn investment in Amazon Web Services, giving it access to Nvidia\u2019s graphic processing units for seven years.<\/p>\n But the deal has also raised fresh questions over the circulatory nature of AI investment. Well over $1 trillion has been promised for various AI programmes, and the vast majority of this involves a very small group of tech corporations with OpenAI and Nvidia at the centre of most of it. So far, there has been precious little return on all this funding, but investors expect to reap outsized gains in future years. But some are doubting whether AI can possibly live up to the hype in terms of future returns.<\/p>\n Share<\/a>Deutsche Bank: Growing chorus of ‘whether we might be on verge of equity correction’<\/p>\n Jim Reid, analyst at Deutsche Bank, said there is talk of whether we are \u201con the verge of an equity correction\u201d.<\/p>\n The last 24 hours have brought a clear risk-off move, as concerns over lofty tech valuations have hit investor sentiment. <\/p>\n Markets compounded these losses in the early hours of Asian trading but have been rallying back in the couple of hours prior to going to print with US futures clawing back towards flat with the Kospi rallying back a couple of percentage points from early -5% plus losses.<\/p>\n On Wall Street yesterday, the S&P 500 closed down 1.17%, losing ground because of sharp losses among tech stocks, and there was a big slump for Palantir (-7.94%) after its earnings the previous day.<\/p>\n Reid added:<\/p>\n Whilst the moves were only one day\u2019s selloff, the market narrative saw a discernible shift, with a growing chorus discussing whether we might be on the verge of an equity correction. That speculation has gathered pace over the last month in particular, mainly because the Magnificent 7 has diverged from the rest of the S&P 500, which has revived questions about how concentrated this equity market now is. Indeed, whilst the Mag 7 have been advancing in recent weeks, the equal-weighted S&P 500 actually fell in October for the first time in 6 months.<\/p>\n Yesterday\u2019s decline for Palantir (-7.94%) was seen as emblematic of this shift, particularly given they\u2019d actually raised their revenue outlook the previous day. But given their share price had quadrupled in the last year, that\u2019s set the bar incredibly high for any earnings releases. In fact, the Magnificent 7 (-2.28%) led the declines yesterday, with Nvidia itself down by a larger -3.96% as some of those top-performing stocks came under scrutiny.<\/p>\n Share<\/a><\/p>\n Updated at\u00a003.47 EST<\/p>\n Thinktanks urge Rachel Reeves to overhaul \u2018broken\u2019 tax system<\/p>\n Thinktanks from across the political spectrum are urging Rachel Reeves<\/a> to use this month\u2019s budget to overhaul the \u201cbroken\u201d tax system, including abolishing stamp duty and merging income tax and national insurance.<\/p>\n The group, which ranges from the rightwing Adam Smith Institute to the leftwing New Economics Foundation, published proposals for sweeping \u201cpro-growth reforms\u201d the chancellor could introduce to \u201ctax all income from work equally\u201d.<\/p>\n A separate report on Wednesday from the National Institute of Economic and Social Research (NIESR) urged Reeves to make \u201cbrave choices\u201d and look for an extraordinary \u00a350bn of spending cuts and tax rises to triple the size of her fiscal buffer.<\/a><\/p>\n The chancellor left the door open to the first rise in the basic rate of income tax for 50 years in a speech on Tuesday<\/a> and the thinktank coalition called on her to prioritise reforming the tax system in her 26 November budget, as well as raising additional revenue.<\/p>\n In its report, NIESR argued that Reeves should grasp the nettle at the budget to build up as much as a \u00a330bn buffer against her rules.<\/p>\n The thinktank said that although factors such as stubbornly high inflation and interest rates were expected to ease, Reeves should urgently address public debt levels, including by increasing the basic rate of income tax.<\/p>\n \u201cThe trajectory of UK public debt is becoming unsustainable. Five years on from the pandemic, this is the moment to reverse that drift and start bringing debt down,\u201d said David Aikman, director of the NIESR. \u201cWithout a credible plan to reduce debt over this parliament, the UK risks locking in a permanently higher \u2013 and potentially unstable \u2013 debt ratio.\u201d<\/p>\n Share<\/a><\/p>\n Updated at\u00a003.23 EST<\/p>\n US supreme court to hear oral arguments on legality of Trump imposing tariffs<\/p>\n Donald Trump\u2019s sweeping tariffs on the world will be scrutinised by the US supreme court<\/a> today, a crucial legal test of the president\u2019s controversial economic strategy \u2013 and his power.<\/p>\n Justices are scheduled to hear oral arguments<\/a> today on the legality of using emergency powers to impose tariffs on almost every US trading partner.<\/p>\n In a series of executive orders issued earlier this year, Trump cited the International Emergency Economic Powers Act, or IEEPA, a 1977 law which in some circumstances grants the president authority to regulate or prohibit international transactions during a national emergency, as he slapped steep duties on imports into the US.<\/p>\n The supreme court \u2013 controlled by a rightwing supermajority<\/a> that was crafted by Trump \u2013 will review<\/a> whether IEEPA grants the president the authority to levy a tariff, a word not mentioned in the law. Congress is granted sole authority under the constitution to levy taxes. The court has until<\/a> the end of its term, in July 2026, to issue a ruling on the case.<\/p>\n Lower courts have ruled<\/a> against Trump\u2019s tariffs, prompting appeals from the Trump administration, setting up this latest test of Trump\u2019s presidential power. The supreme court has largely sided<\/a> with the administration through its shadow docket<\/a> to overrule lower courts.<\/p>\n Share<\/a><\/p>\n Here\u2019s our full story on M&S:<\/p>\n Profits at Marks & Spencer have more than halved after the retailer suffered a damaging cyber-attack, which is still affecting its struggling clothing and homeware business.<\/p>\n The retailer said underlying profits more than halved to \u00a3184.1m in the six months to 27 September from \u00a3413.1m a year before, after it had to halt online orders of clothing and homewares for more than six weeks.<\/p>\n The company\u2019s clothing and homeware sales slumped 16.4% in the half year. The retailer said the division had been \u201cslower\u201d to recover from the hack than its food arm.<\/p>\n M&S said that sales of fashion in stores had been \u201cimpacted by reduced availability and fewer visits linked to the absence of click and collect\u201d, and warehouse systems were now restored so \u201cboth our website and stores are improving availability, and trading is recovering\u201d.<\/p>\n![\"Kalyeena](\"https:\/\/www.newsbeep.com\/au\/wp-content\/uploads\/2025\/11\/Kalyeena_Makortoff,_L.png\")
Kalyeena Makortoff<\/p>\n