The downfall of Ted Baker

• The downfall of Ted Baker

• X shuts down operations in Brazil

• KSI & The Sidemen’s earnings revealed

_{Leading the agenda}

Buyers return to property market

📍 Top line: The UK housing market, which had been experiencing a lull, is showing signs of renewed activity as autumn approaches. The number of prospective buyers contacting estate agents surged by nearly 20% in August, compared to July, suggesting a potential revival in the market.

This increase in buyer activity follows the Bank of England's recent decision to cut interest rates for the first time in four years. The rate cut appears to have boosted confidence among potential homebuyers, with Tim Bannister, a director at Rightmove, noting a "welcome late summer boost in buyer activity."

The average two-year fixed mortgage rate has decreased to 5.18%, down from around 6% earlier in the summer. However, any further reductions in borrowing costs are expected to be gradual, as the BOE is anticipated to adopt a cautious approach to future rate cuts.

🏠 What’s happening to prices: The average asking price for new sellers dropped by 1.5% in August, a decrease of £5,708, bringing the average price to £367,785, according to Right Move. This decline is typical for August, as the property market tends to slow down during the summer months

_Business

Ted Baker to close final stores

📍 Top line: The last remaining 31 Ted Baker stores are set to close this week, putting over 500 jobs at risk. This follows an earlier wave of closures in April, which saw 15 stores shut and 245 jobs cut.

A potential licensing deal between Authentic Brands Group, Ted Baker’s US owner, and Mike Ashley's Frasers Group has stalled, leaving the brand's future uncertain. If the deal had gone through, Ted Baker would have joined other brands under Frasers Group, like Flannels and Jack Wills.

This follows the collapse of the company behind Ted Baker's UK operations, No Ordinary Designer Label (NODL), which went into administration in March.

📉 What went wrong: Ted Baker has been grappling with significant challenges over the past few years, as it faces intense competition and the industry's shift towards online trading. Once a leading name in British fashion, the brand has struggled to maintain its market position in a rapidly changing retail landscape. The UK fashion industry has also faced a challenging year, exacerbated by an unseasonably cold spring and early summer, which affected consumer demand for seasonal clothing and the ongoing cost of living crisis has further strained the sector.

Elsewhere in Business:

👕 Boohoo is taking bold action to address product quality problems by withholding payments from manufacturers it claims are responsible for a large number of faulty goods. The situation adds to the difficulties confronting Boohoo, including poor trading performance, intense competition from Chinese rivals, and a steep drop in its share price—over 90% from its pandemic highs. In May, Boohoo reported widening annual losses of £160 million, up from £90 million the previous year, and a 17% decline in turnover to £1.5 billion.

🍿 Disney’s latest blockbuster, Deadpool & Wolverine, has made history by becoming the highest-grossing R-rated film of all time. surpassing Warner Bros.' Joker. With domestic ticket sales reaching $516.8 million and an impressive $568.8 million from international markets, the film's global total now stands at over $1.085 billion.

^Markets

_Economy

UK facing £3bn shortfall in tourist spending

📍 Top line: While other industries have regained or bettered pre-Covid levels of activity, the UK’s tourism industry is struggling to recover from the pandemic.

According to The Times, the UK is attracting almost three million fewer visitors annually, resulting in a £2.8 billion reduction in spending compared to 2019.

The Centre for Economics and Business Research (CEBR) has attributed the poor recovery of the tourism industry to a “general cautiousness surrounding international travel”. However, Britain’s main competitors are expected to experience growth in the sector this year, suggesting that the UK’s reputation as a tourist destination could be diminishing.

📉 Where has been affected? Brighton has seen the greatest tourist drop-off, down 32 per cent on 2019, with Newcastle next most impacted at 26 per cent. Oxford and Bath’s tourism income are 23 per cent and 22 percent lower respectively. For cities and businesses that rely heavily on visitors from overseas, these figures represent a significant dent to income.

Other cities, however, have enjoyed a boost to tourist numbers. Liverpool, Manchester, Edinburgh and Inverness have all benefitted from an increase in visitor’s footfall - although at rates of less than 10 per cent.

Elsewhere in the Economy:

🇺🇸 Goldman Sachs economists have revised their outlook on the likelihood of a U.S. recession in the next year, lowering the probability from 25% to 20%. This adjustment comes after the release of recent retail sales and jobless claims data, which indicated continued economic resilience.

🇮🇱 Israel's economic growth slowed significantly in the second quarter of 2024, with GDP rising by just 1.2% on an annualised basis, down from a revised 17.3% in the previous quarter. This slowdown was much worse than expected, as economists had forecasted a growth rate of around 5%. The ongoing war with Hamas has severely impacted key economic sectors, particularly exports and investments.

_{Job of the day}

💼 Global management consultancy firm McKinsey is now hiring for its Associate Intern scheme. The successful applicants will spend 8-10 weeks in one of the firm’s global offices helping private and public clients solve complex problems and challenges. More details here.

_Tech

Elon Musk’s X shuts down operations in Brazil

📍 Top line: Elon Musk's social media platform X (formerly Twitter) is shutting down its operations in Brazil due to escalating tensions with the country's judiciary. The decision follows a legal battle with Alexandre de Moraes, a judge on Brazil's Supreme Federal Court, who had issued orders that Musk claims required the platform to engage in "illegal secret censorship" and turn over private information.

According to Musk, the closure of X's Brazilian offices is necessary to protect the safety of the company's staff, as they were allegedly threatened with arrest if the platform did not comply with these demands.

Despite closing its local offices, X will continue to be accessible to users in Brazil for the time being.

Elsewhere in Tech:

💸 KSI and the Sidemen have been recognised as some of the wealthiest gamers in the UK, making it onto the inaugural Sunday Times Gaming Rich List. They rank 21st with a collective fortune of £50 million, showcasing their significant success beyond just gaming, including ventures in YouTube, music, and boxing.

📱 Fortnite’s mobile app has return to iPhones in the EU and Android devices worldwide after it was removed from the app stores in 2020 due to a dispute over payment systems. The EU's new Digital Markets Act has forced Apple to allow third-party app stores, allowing the launch of the Epic Games Store. Epic Games is planning to bring Fortnite back to UK iPhones by late 2025.

_{On this day}

In 2004 - Google Goes Public: Google Inc. had its initial public offering (IPO) on the Nasdaq Stock Market, transforming it into one of the world's most valuable companies.

Beyond The Biz

🇺🇸 US Secretary of State Anthony Blinken has arrived in Israel for talks over a potential ceasefire and a hostage-release deal in Gaza. This is the American’s 9th trip to the region since war broke out, and he is expected to meet senior leaders, including Benjamin Netanyahu, before travelling on to Egypt.

🌕 UK skies will be lit up tonight by a rare blue supermoon. The phenomenon occurs when the Moon’s orbit brings it closer to Earth, making it appear larger and brighter. Take the chance to see it tonight as the next one won’t be until 2037!

🎥 French actor Alain Delon, an iconic figure in cinema known for his roles in classics like "Le Samouraï" and "The Leopard," has died at the age of 88. Delon's death was announced by his three children, who stated that he passed away peacefully at his home in Douchy, France, surrounded by family.