02/11/2015

Download Subtitles

Transcript

:00:00. > :00:00.Now for the latest financial news with Sally

:00:00. > :00:22.Europe's largest bank reports a surprise 32% rise in profits,

:00:23. > :00:25.but what does it mean for the future of HSBC's

:00:26. > :00:29.And is Fitbit losing the race in the wearable health tech sector?

:00:30. > :00:31.The competition is gaining ground but will it impact

:00:32. > :00:45.Also in the programme China adjusts to the "new normal",

:00:46. > :00:53.we'll have the latest manufacturing data and it's another contraction.

:00:54. > :00:58.I am afraid the information is going in the wrong direction, once again.

:00:59. > :01:00.HSBC has just reported its third quarter results and pre-tax

:01:01. > :01:03.profit was up 32% to $6.1 billion dollars from a year earlier.

:01:04. > :01:06.The main reason for the rise, reduced costs from fines.

:01:07. > :01:08.Remember, this is the first update since

:01:09. > :01:10.substantial cost-saving measures were announced back in June.

:01:11. > :01:14.And then there's the question of moving the headquarters

:01:15. > :01:18.Back in April, Britain's largest bank said it would begin a review

:01:19. > :01:30.of whether or not to stay in the City or move back to Asia.

:01:31. > :01:39.With me is Gemma Godfrey Investment Director, at Moo.la.

:01:40. > :01:46.You have looked at the numbers and the report, what do you make of

:01:47. > :01:49.them? It is interesting that revenues fell because they are so

:01:50. > :01:53.exposed to the Asian market to. Two thirds of their earnings are

:01:54. > :01:56.generated in Asia and the plunging stock market there meant it impacted

:01:57. > :02:07.their topline. The fact that they have done these cost cuttings, their

:02:08. > :02:12.compliance costs have risen while the rest has fallen has had an

:02:13. > :02:16.impact on their bottom line. All of those massive hits because of the

:02:17. > :02:20.barriers come of the inflation issues and so forth, that is getting

:02:21. > :02:25.less and less, but in terms of the cost savings they announced, none of

:02:26. > :02:29.that is in these numbers now. When will we start to see that the impact

:02:30. > :02:33.on the earnings in the future? They only announced in June that they

:02:34. > :02:38.were going to cut 25,000 jobs, so we are yet to see those follow-through

:02:39. > :02:40.into the numbers. If we take a step back and look at the banking

:02:41. > :02:43.industry as a whole, there are three things investors are looking at.

:02:44. > :02:50.Where's the growth going to from? Because revenues fell HSBC, we are

:02:51. > :02:52.still uncertain. Secondly, how are they going to cut costs? They have

:02:53. > :02:54.given the plans and see that through. Thirdly is how

:02:55. > :03:12.they're going to raise into it. We're not expecting an

:03:13. > :03:12.announcement this year but looking at

:03:13. > :03:19.did recently announced that they were going to be moving

:03:20. > :03:26.their investment banking relations back to Hong Kong and the reason for

:03:27. > :03:31.that is twofold. Reduced costs but also they want to reduce regulatory

:03:32. > :03:38.costs and to reduce the tax burden as well.

:03:39. > :03:42.less of a burden elsewhere, but with the banking moving, it does remove

:03:43. > :03:49.the impetus to do more of their operations in other areas. For

:03:50. > :03:59.international viewers, there is a levy imposed by the UK government on

:04:00. > :04:03.profits made in the UK by banks? It is going to go over in the next few

:04:04. > :04:07.years. That was a big amount of money going straight to the UK

:04:08. > :04:11.government. Absolutely and the thing about that is it comes back to being

:04:12. > :04:16.competitive. The argument of HSBC was, they are being penalized in a

:04:17. > :04:23.way that other international banks aren't. Thank you. Those of the

:04:24. > :04:27.numbers of HSBC which is come out in the last half-an-hour. We will be

:04:28. > :04:29.keeping you up-to-date with how the shares perform in light of this

:04:30. > :04:34.figures. -- those. Technology has made life easier

:04:35. > :04:36.in lots of different ways especially for those of you who are

:04:37. > :04:40.aiming to be healthy and active. Wearable tech keeps track of

:04:41. > :04:42.activity levels, calorie intake and even sleep - and the most popular

:04:43. > :04:46.brand on the market is Fitbit. Competitors are creeping in and

:04:47. > :04:50.in a few hours' time Fitbit will release its latest financial results

:04:51. > :04:52.which will give us an indication of the company's ability to stay

:04:53. > :05:14.ahead of the pack. Few electronic gadgets have caught

:05:15. > :05:18.on with people as fast as Fitbit. These devices help you to track your

:05:19. > :05:21.fitness eye measuring the number of stairs you have climbed, the

:05:22. > :05:26.distance you have walked and how much sleep you have had. 20 million

:05:27. > :05:32.of them are now sold annually. Last June, Fitbit floated its shares in

:05:33. > :05:38.New York and the price soared from $20 to over $50 but then fell back.

:05:39. > :05:41.Some investors seem to be having second thoughts about Fitbit's

:05:42. > :05:44.supposedly positive future. They arrived on the market with a very

:05:45. > :05:51.good packaged product at the right time. That so many other companies

:05:52. > :05:54.have now entered the market with similar products packaged in similar

:05:55. > :05:58.ways and there's come addition from very large organizations such as

:05:59. > :06:00.major sportswear manufacturers, not to mention the smartwatch and

:06:01. > :06:06.smartphone manufacturers who have got in on the space as well.

:06:07. > :06:11.Fitbit's two biggest challenges are a Chinese firm which sells a

:06:12. > :06:17.cutprice device and Apple which has the fitness monitoring app in its

:06:18. > :06:21.smartwatch. In summer of last year, Fitbit was still the clear leader of

:06:22. > :06:28.its field with 30% of the market. Apple had no share of it and neither

:06:29. > :06:34.had the Chinese version. Now Fitbit has sunk to 24% and Apple has 20%

:06:35. > :06:39.and the Chinese version has 17%. Does that mean Fitbit is in danger

:06:40. > :06:44.of being overtaken or can it rely on the name and has established? Fitbit

:06:45. > :06:48.has become synonymous with fitness trackers in general. When people, to

:06:49. > :06:53.me and see I am wearing all these different devices, the question is

:06:54. > :06:56.whether these are my Fitbit devices? So they have become household names

:06:57. > :07:02.just like Go-Pro has become synonymous with a wearable camera.

:07:03. > :07:10.The central strategy of Fitbit has been to build enough of a brand

:07:11. > :07:11.recognition amongst fitness fanatics that it maintains its place in the

:07:12. > :07:15.wearable technology world. We've had manufacturing data out

:07:16. > :07:18.of China and it's fallen Sharanjit Leyl is

:07:19. > :07:32.in our business hub in Sinapore. Tell us more about this. It is

:07:33. > :07:38.interesting in light of what happened last week and China

:07:39. > :07:44.desperately trying to, with a plan to reverse this trend -- trying to

:07:45. > :07:47.determine a plan. You have summed it up. This is the latest government

:07:48. > :07:52.survey and it is watched very closely. It is a gauge of how the

:07:53. > :07:57.manufacturing industry is doing in China. It is showing a reading of

:07:58. > :08:01.49.8 for October. We know any figure below 50 indicates that factory

:08:02. > :08:11.activity has contracted and that has been several months now. 'S shortly

:08:12. > :08:16.after the release, a private survey pretty much reiterated this --

:08:17. > :08:25.shortly. It to the index at 48.3. It is often considered more accurate as

:08:26. > :08:33.tiny statistics from the government can often be viewed with skepticism

:08:34. > :08:37.-- it has shown. They are growing at the weakest rate since the financial

:08:38. > :08:40.crisis and over the summer, we reported a lot about the stock

:08:41. > :08:47.market slump which impacted many other markets globally and indeed,

:08:48. > :08:52.the slowdown that was seen in demand generally. In fact, the government

:08:53. > :08:57.is tried to move away, really, from being an export led economy to being

:08:58. > :09:02.a consumer services lead one. This has all been an adaptation, at

:09:03. > :09:12.keeping issue according to many experts -- a teething issue. They

:09:13. > :09:15.have cut rates five times in the last year. Thank you.

:09:16. > :09:18.In other news: Chipotle Mexican Grill has temporarily closed 43

:09:19. > :09:20.restaurants in Washington state and Oregon while authorities

:09:21. > :09:25.People who ate in six Chipotle restaurants are among 20 cases of E.

:09:26. > :09:28.The fastfood chain said it was acting with

:09:29. > :09:31."an abundance of caution" as most of the 43 outlets were unaffected and

:09:32. > :09:40.Martin Blessing, chief executive of Commerzbank,

:09:41. > :09:45.Mr Blessing has been in charge since May 2008 and had been asked

:09:46. > :09:48.by the bank to stay on but he said it was a good time

:09:49. > :09:52.Mr Blessing helped Germany's second largest lender recover after

:09:53. > :10:07.the financial crisis and turned around its financial fortunes.

:10:08. > :10:13.Markets across Asia have been hit quite hard by the news that was

:10:14. > :10:18.mentioned recently. Markets in Japan are down around 1.5%. That is all

:10:19. > :10:24.from the, see you soon. Prime Minister David Cameron has

:10:25. > :10:27.unveiled new measures to speed up As well as cutting red tape,

:10:28. > :10:31.councils will be challenged to