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October 29th Briefing: Syrian oil fields, Brexit extension, Google falls and more…

By November 1, 2019 No Comments

EU grants Brexit extension

The European Union has said that it would extend the Brexit process to January 31 after the British government requested one. It is the second extension given to Brexit after March’s deadline was furthered to October 31. Boris Johnson has to accept this under the so-called Benn Act. Mr Johnson had promised ‘do or die’ to take the UK out of the EU by October 31.

The extension can be cut short if Parliament agrees to a Brexit deal. No majority for any course exists in Parliament, so Mr Johnson is pushing for an early general election.

Hong Kong could go into recession

Hong Kong’s Chief Executive, Carrie Lam, has warned that the territory may slip into an economic contraction over the course of 2019. The protests which have engulfed the city for nearly half a year have damaged the tourism industry and depressed retail sales. Full Hong Kong GDP figures will be released on Thursday.

Ms Lam has said that $2.6bn has been pumped into the city’s economy to help struggling sectors, like tourism and retail. She also said that other stimulus efforts may be used.

Google falls after tough quarter

Early reaction to a tough quarter for Google saw shares in Alphabet, its parent company, fall by 2%. Though revenue was up $25bn, to $150bn, from last year, higher costs sent net income down to $7.1bn down from last year’s $9.1bn and well below analyst’s expectations.

Higher costs were blamed for the decline. Investment in new buildings and computing capacity have pushed up direct costs by 23%. These new investments are to handle new services, like the video game streaming Stadia which will launch this month.

US sends troops back to Syria

Troops, possibly including tanks, have been moved to the oil-rich northeastern part of the country soon after President Donald Trump had withdrawn other forces in an attempt to fulfil his promise of bringing soldiers home. The troops will be used to guard oil fields, currently controlled by the Kurdish-led SDF, from Syrian or Russian control.

The oil fields help fund the SDF’s operations, such as running prisons full of Islamic State fighters. After the weekend’s raid that killed IS’s leader, the US hopes this move will stop a resurgence of it.

TikTok owner plans IPO

Chinese startup Bytedance hopes to go public early next year when it lists on the Hong Kong stock exchange. It is currently valued at around $75bn. That valuation comes from last year’s private round, which raised $3bn from SoftBank.

Bytedance was launched in 2012 and is one of China’s biggest unicorns. It runs TikTok, the video-sharing app, as well as Toutiao, a popular app in China that is used to share content of all kinds. Bytedance, as a whole, had 800m daily active users in 2018.