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Feb 5, 2019

Alphabet’s investment-fueled earnings beat overshadowed by concerns about Google’s spending.

Therese Poletti

Alphabet Inc. reported stronger-than-expected profits Monday, thanks to a mysterious investment gain, but shares fell in after-hours trading amid displeasure with a hefty jump in spending.
Google’s parent company was partly boosted by a mysterious investment gain of $1.3 billion, that it only described as an “unrealized gain recognized in OI&E [other income and expenses] related to a non-marketable debt security.” Alphabet’s diluted earnings would have been approximately $10.91 a share, just above the FactSet consensus estimate of $10.86 a share, without that gain.
Alphabet’s investment prowess has been a boon for the company since it began counting increases in its investments as profit last year due to an accounting change. For the full year 2018, Alphabet said it had a $5.5 billion gain on equity securities, including $4 billion of net unrealized gains on equity investments.
For more: Google is a great investor and it’s showing in the results
Despite the inflated earnings beat, Alphabet shares GOOGL, +0.92% GOOG, +1.16%   declined in after-hours trading, ending the extended session down about 3%. The stock was down 2.4% in premarket trade Tuesday. Wall Street seemed concerned about the company’s hefty spending on research and development and on capital expenditures, which Colin Sebastian, a Robert W. Baird analyst, said “overshadowed a solid revenue beat.”
Alphabet’s total capital expenditures, including its spending on its “other bets” outside of the core Google business, surged about 65% in the quarter. Alphabet spent $7.08 billion on capital expenditures, with $6.8 billion of that on Google, up from $4.3 billion a year ago, and expects to continue spending, though at a slower rate.
“We do expect the rate of year-on-year capex growth will slow meaningfully,” said Alphabet Chief Financial Officer Ruth Porat, when asked about the spending on the call. She added that there would be more of an uptick in 2019 in data-center investments relative to servers, and less hiring.
“We’re trying to get it right,” Porat explained. “Over-investing, under-investing, neither of those works on allocation, but we are very mindful of the pace here and trying to lay out with more specificity how we’re looking at the opportunity...and making tradeoffs where we can.”
That was just one example of how Alphabet’s executives said a lot on the company’s conference call without actually saying much of anything. Porat was also asked a question about when the company might begin segment reporting for the growing YouTube business, a question she conveniently ignored while answering other questions about the leadership change in the cloud business.
Alphabet’s big spending has been an issue before, with Wall Street getting irked by the company’s hefty hiring numbers. With this quarter’s earnings goosed by a fat investment gain that didn’t actually add that money into its accounts, investors are not as forgiving for that big spending. Next quarter will be a test to see just how much Alphabet actually slows down its spending rate, as Wall Street looks for better real earnings.

Source: MarketWatch

Oil Fades as Stocks Soar

By John A. Jagerson Updated Feb 5, 2019

Major Moves

Traders will often focus on the completion of a technical signal or a technical pattern in their analysis, as these events can mark the beginning of a new bullish or bearish move. But what happens when these signals and patterns fail?
We're seeing an excellent example of a failed pattern on the crude oil chart today, as the commodity is falling back below the uptrending neckline of the inverse head and shoulders bullish reversal pattern it completed on Friday, Feb. 1.
The break above the uptrending resistance level last Friday signaled the beginning of what could have been a new bullish move for oil that, based on the height of the pattern, would have had an initial price target of $65.50 ($54.50 breakout point + $11 pattern height = $65.50 target price). Unfortunately for oil bulls, the price of oil closed below the uptrending level that served as the neckline of the pattern, which invalidates the inverse head and shoulders.
It appears that commodity traders are viewing the move by the Organization of Petroleum Exporting Countries (OPEC) to reach out and form a loose union with Russia and other former Soviet republics as a confirmation that oil demand is not keeping up with oil production. After all, OPEC, Russia and these other countries wouldn't need to form a union of any kind to produce more oil – only to coordinate a production reduction.
This is all happening as Venezuelan oil tankers with approximately 7 million barrels of crude oil are stuck floating in the Gulf of Mexico with nowhere to go thanks to U.S. sanctions against Venezuelan oil.
Failed patterns have a high likelihood of moving in the opposite direction of the original breakout. There's no guarantee that this will happen for oil, but if the uptrending level that served as support for the left and right shoulders of the reversal pattern can't hold at $51.50, traders should watch for oil to retest its late-December 2018 lows.

S&P 500

The S&P 500 confirmed its bullish momentum once again today by not only closing higher but also continuing to ride the upper Bollinger® band.
Many new chart technicians mistakenly believe that the upper Bollinger® band is likely to serve as a resistance level during uptrends and the lower Bollinger® band is likely to serve as a support level during downtrends. The opposite is true.
When John Bollinger created his famous bands, he noted that the price of an asset riding along the upper band is a confirmation of bullish momentum, while the price of an asset riding along the lower band is a confirmation of bearish momentum.
Seeing the S&P 500 continuing to climb the upper band tells us that the market may have enough momentum to revisit its former resistance level at 2,820.
Read more:

Risk Indicators – The VIX

The CBOE Volatility Index (VIX) dropped down and touched 15 today for the first time since Oct. 5, 2018. The VIX couldn't hold onto its intra-day lows, but this move shows that, halfway through the Q4 2018 earnings season, traders are starting to become more confident in the future of the U.S. stock market.
It was at the beginning of the Q3 2018 earnings season – which got under way last October – that the VIX first started to show signs of stress as traders wondered if corporate earnings were going to be strong enough to sustain the bearish impact of rising interest rates.
At this rate, the VIX could be comfortably consolidating between support at 11.5 and resistance at 15, like it did from July through September 2018 – a period of steady gains for the S&P 500.
Read more:

Bottom Line: Blue Skies Ahead

Whether you're looking at the charts of the major market indexes or the key risk indicators, you're seeing the same thing: bullish confirmation.
Wall Street has come a long way back from its December 2018 drop, and it appears that even with the uncertainty still facing the global economy, traders are committed to climbing the wall of worry.

Source: Investopedia

EU FX | Currencies: Dollar firm ahead of Trump's State of the Union address

4-5 minutes

A U.S. dollar bill, £1 coin and 1 euro coin
Matt Cardy | Getty Images
A U.S. dollar bill, £1 coin and 1 euro coin
The U.S. dollar rose against a basket of major currencies on Tuesday, as investors awaited President Donald Trump's State of the Union address for a possible update on the U.S.-China trade war.
Continued recovery in investors' appetite for risk taking exerted pressure on safe-haven currencies, dragging the Swiss franc lower, while the Australian dollar climbed after the nation's central bank warned of risks to growth and steered clear of an explicit policy-easing signal.
With central banks around the world in a holding pattern, and a host of uncertainties on trade and other factors, trading in currency markets was largely range-bound, Eric Viloria, FX strategist at Credit Agricole, said.
"These ranges could go on for some time until there is more decisive central bank actions or resolutions to some of these political dynamics whether it's trade negotiations or otherwise," said Eric Viloria, FX strategist at Credit Agricole.
The Federal Reserve should leave interest rates where they are until the U.S. economic outlook is clearer, Dallas Fed President Robert Kaplan said on Tuesday, a process that in his view could take several more months.
The dollar index, which tracks the greenback versus the euro, yen, British pound and three other currencies, was up 0.21 percent at 96.06. The index, which hit a more than one-week high of 96.12 earlier in the session, is little changed for the year.
The euro was 0.23 lower against the dollar after a survey showed on Tuesday that euro zone businesses expanded at their weakest rate since mid-2013 at the start of the year.
Investors are shifting their attention to Trump's impending State of the Union address at 9 p.m. eastern, which could hint at progress in U.S.-China trade talks.
"Market focus is likely to be on any indications on how Sino-U.S trade negotiations are going; anything positive on the trade news front should provide support for the greenback," Dean Popplewell, chief currency strategist at Oanda, said in a note.
Continued recovery in investors' appetite for risk taking pressured safe-haven currencies, and the Swiss franc, which tends to appreciate during bouts of economic uncertainty, sank to an 11-week low against the dollar.
The Australian dollar rose sharply, reversing earlier losses, after the Reserve Bank of Australia (RBA) held rates at record lows at its first meeting of the year but sounded less dovish than expected.
The British pound slumped to two-week lows after weak survey data and uncertainty about Brexit talks pushed it below a key market level, forcing some large investors to cut some bets.
The Canadian dollar slipped against its U.S. counterpart as oil prices edged lower.

Source: CNBC

Bond Yields Closing Report: US Treasury yields fall ahead of Trump's State of the Union speech

Silvia Amaro

Economic activity in the non-manufacturing sector grew in January for the 108th consecutive month, the nation's purchasing and supply executives said Tuesday. The Institute for Supply Management Non-Manufacturing index registered 56.7 percent, 1.3 percentage points lower than the December reading of 58 percent. The New Orders Index registered 57.7 percent, 5 percentage points lower than the reading of 62.7 percent in December.
President Donald Trump is due to address the Congress with his 2019 State of the Union Speech on Tuesday. Money managers will be looking for comments on trade and the broader U.S. economy.
On Monday, the President had an "informal meeting" with Fed Chairman Jerome Powell, where both discussed "recent economic developments and the outlook for growth, employment and inflation."
Trump, who nominated Powell to be Fed chairman, has been one of Powell's most vocal critics, blaming central bank rate increases for slowing the economy and roiling the stock market.
"I always feel it's important for two sides to hear each other and it reduces, but it doesn't eliminate, but reduces misunderstandings in the future," economist Mohamed El-Erian told CNBC on Tuesday. "I think net-net this is neutral to slightly favorable to the market. But it's not a big deal."
Meanwhile, the Treasury will auction $38 billion in 3-year notes.
Much of the action over the past week has stemmed from the Federal Reserve's monetary policy decision on Wednesday. The central bank kept the federal funds rate steady as expected, but also vowed to be "patient" when adjusting monetary policy in the future.

Source: CNBC

Crude Oil Closing Report: US crude falls 1.7%, settling at $53.66, as weak factory data feeds demand fear

6-8 minutes

Oil pumps are seen in Lake Maracaibo, in Lagunillas, Ciudad Ojeda, in the state of Zulia, Venezuela.
Isaac Urrutia | Reuters
Oil pumps are seen in Lake Maracaibo, in Lagunillas, Ciudad Ojeda, in the state of Zulia, Venezuela.
Oil prices fell in choppy trade on Tuesday, pulling back from two-month highs after weak U.S. factory orders data rekindled economic slowdown worries.
Despite the slide, investors expect U.S. sanctions on Venezuela and production cuts led by OPEC to head off a glut this year, buoying prices.
U.S. West Texas Intermediate futures ended Tuesday's session down 90 cents, or 1.7 percent, at $53.66 per barrel around 2:25 p.m. ET, near the day's low of $53.47. WTI touched its highest in more than two months at $55.75 in the previous session.
International Brent crude futures were down 41 cents at $62.10 a barrel around 2:25 p.m. ET, near a session low at $61.72 and well off Monday's two-month high of $63.63.

"I think the oil market is trying to decide whether the factory orders will weigh on the price or the Venezuela and oil sanctions will support the price. As a result, we've seen the market fluctuating," said Andrew Lipow, president of Lipow Oil Associates in Houston.
Oil is also modestly out of favor as investors reallocate assets, said Phillip Streible, senior commodities strategist at RJO Futures.
"They are all jumping into the equity markets and getting out of some of the other markets that may be weighed on by U.S.-China trade relations or markets affected by the dollar index," Streible said.
Wall Street was slightly higher on Tuesday, while the dollar also rose.
Still, analysts said U.S. sanctions on Venezuela are focusing market attention on tighter global supplies. Numerous tankers are currently in the water off the Venezuelan coast, unable to move because state-owned PVDSA is demanding payment, which would run afoul of U.S. sanctions.
Supplies of heavy crude oil produced in Venezuela are scarce, as other providers like Mexico and Canada have also faced challenges to output and export.
The Organization of the Petroleum Exporting Countries and its allies, including Russia, agreed to production cuts effective from last month to beat back increasing supply.
The oil industry generally believes the curbs will help to balance the market in 2019, particularly with crude supply growth out of the United States.
"You'll see OPEC disciplined and therefore prices look fairly robust around where they are," BP finance chief Brian Gilvary told Reuters, adding that he expects demand growth of 1.3 million to 1.4 million barrels per day in 2019 - similar to last year.
A Reuters survey found that supply from OPEC states had fallen the most in two years, with Saudi Arabia and its Gulf Arab allies over-delivering on pledged cuts while Iran, Libya and Venezuela registered involuntary declines.
Still, concerns about the pace of global economic growth remained. New orders for U.S.-made goods fell unexpectedly in November, with sharp declines in demand for machinery and electrical equipment, according to data released on Monday.
The global economic outlook and prospects for growth in fuel demand have also been clouded by poor economic data in China and U.S.-China trade tensions.

Source: CNBC

Metals Price Closing Report: Gold edges higher as market awaits Trump address


Umit Bektas | Reuters
Gold moved slightly higher on Tuesday, supported by uncertainties surrounding U.S.-China trade relations ahead of President Donald Trump's State of the Union address to the Congress, while a firmer dollar and rising global stock markets capped gains.
Spot gold edged up 0.21 percent to $1,314.47 per ounce by 1:52 p.m. EST after hitting its weakest since Jan. 29 at $1,308.20 in the previous session.
U.S. gold futures settled $0.10 lower at $1,319.20 an ounce.
"We have the State of the Union address and we are still waiting for more hard data on trade talks," said David Meger, director of metals trading at High Ridge Futures.
"There are still political concerns which remain and that probably adds to support for gold, along with the dovish U.S. Federal Reserve."
Gold last week rose to its highest since late April at $1,326.30, after the U.S. central bank kept interest rates steady and said it would be patient on further hikes amid a cloudy outlook for the economy due to global growth concerns and the U.S.-China trade dispute.
Solid U.S. jobs data since then, however, has allayed concerns of an immediate slowdown in the U.S. economy.
The central bank may need to raise U.S. interest rates a bit further if the economy does well, Cleveland Fed President Loretta Mester said on Monday.
Gold tends to fall out of favor when interest rates rise.
World stock markets extended their robust start to the year, making non-yielding bullion a less-attractive investment, while the dollar, which is at a more than one-week high, was on course for a fourth straight session of gains.
Investors are awaiting Trump's address due at 9 p.m. EST on Tuesday for some clarity on U.S.-China trade relations and a political logjam over the construction of a wall along the country's border with neighboring Mexico.
On the technical front, Monday's dip to a near one-week low reflected that some investors are "coming into the (gold) market now before it takes off any higher," said Michael Matousek, head trader at U.S. Global Investors.
The overall outlook for bullion remains positive, analysts said.
"Further market turbulence and confrontational politics could keep gold in investors' sights," Heraeus Precious Metals said in a client note.
"Gold is expected to trade in a range between $1,225/oz and $1,450/oz, with the outlook broadly for further upside, though no doubt with some pull-backs along the way," it said.
Among other precious metals, palladium gained about 1 percent to $1,378 per ounce.
Silver was down 0.17 percent at $15.84 per ounce and platinum dipped 0.55 percent to $814.50.

Source: CNBC

Wall Street Closing Report: Dow climbs more than 150 points ahead of Trump's State of the Union address

Fred Imbert

Stocks rose on Tuesday as the corporate earnings season rolled on, with investors eagerly awaiting President Donald Trump's latest State of the Union.
The Dow Jones Industrial Average traded 159 points higher, led by Apple and Intel. The Nasdaq Composite gained 0.7 percent while the S&P 500 climbed 0.4 percent on the back of gains from the tech and consumer sectors.
Alphabet, Seagate Technology and Estee Lauder are among the companies that have reported better-than-expected earnings. However, Alphabet traded slightly lower as the company also revealed declining advertising prices and rising costs. Seagate shares also dipped 1 percent.
Estee Lauder, meanwhile, jumped 12 percent on better-than-expected results. The company also raised its 2019 earnings guidance. Archer-Daniels Midland fell 6.7 percent after reporting weaker-than-expected earnings and revenue.
A trader laughs ahead of the closing bell on the floor of the New York Stock Exchange (NYSE) on February 1, 2019 in New York City.
Johannes Eisele | AFP | Getty Images
A trader laughs ahead of the closing bell on the floor of the New York Stock Exchange (NYSE) on February 1, 2019 in New York City.
Nearly half of S&P 500 companies have reported earnings through Tuesday morning, with about 70 percent of those companies topping analyst expectations, according to The Earnings Scout.
"However, the beat rates are running below last quarter as the overall year-over-year rates of sales and earnings growth has decelerated," said Nick Raich, CEO of The Earnings Scout, in a note to clients. "Most importantly, 1Q 2019 through 3Q 2019 S&P 500 EPS growth expectations continue to go lower with some providers already showing negative growth."
FactSet data show that corporate earnings for the first quarter are expected to decline by 0.8 percent. Raich said, however, he expects earnings to continue growing in the first half of 2019. He added the negative estimates are mostly a byproduct of "low-balled estimates."
Disney, Electronic Arts, Snap and Spirit Airlines are among the companies scheduled to report after the bell Tuesday.
Wall Street also looked ahead to the State of the Union, which comes more than a week after the longest government shutdown in U.S. history came to an end. Investors should be looking for clues on a number of matters, including U.S.-China trade talks.
"We expect an optimistic tone on President Trump's desire to strike a deal, but we remain cautious that these headlines are likely to whip around during any verification or enforcement phase," Ed Mills, public policy analyst at Raymond James, wrote in a note to clients.
The president could also make comments on drug pricing during the speech, as well as a possible infrastructure bill. Some stocks to watch heading into the speech include Fluor Corp, Jacobs Engineering, chipmaker Qorvo and Wynn Resorts, according to Strategas Research Partners.
But while Trump could strike a bipartisan approach on both of those fronts — which would be bullish for the market — the stalemate over the U.S.-Mexico border wall with Democrats could undercut that.
Isaac Boltansky, director of policy research at Compass Point, said Trump will likely dedicate a good chunk of his speech to his wall proposal. "We believe there will be an outsized focus on the border wall and the president could use this forum to build his case for unilateral administrative action on the wall (e.g., national emergency declaration)," Boltansky wrote in a note.
—CNBC's Silvia Amaro contributed to this report.

Source: CNBC

Metals | Spot prices as of the Close of Trading in New York.

Spot Prices as of the  close of trading in New York
Tuesday, February 05, 2019

Source: CMI Gold & Silver

Brexit latest news: Theresa May rules out scrapping backstop ahead of showdown talks with Jean-Claude Juncker

Jack Maidment, Political Correspondent 5 February 2019 • 5:52pm

Theresa May has ruled out scrapping the backstop but insisted the “insurance policy” will have to change if MPs are to back her Brexit deal.
Speaking in Belfast, the Prime Minister said she would not be asking the House of Commons to accept a Withdrawal Agreement “that does not contain” the backstop.
It is the first time Mrs May has explicitly said the controversial protocol would not be removed in comments which are likely to anger hardline Brexiteers and appear to narrow her options for breaking the impasse with the EU.
Mrs May is due to meet with Jean-Claude Juncker, the president of the European Commission, on Thursday for showdown talks as she tries to salvage her deal.
Ruling out removing the backstop potentially means there are now just two options available to her which could be capable of securing the support of a majority of MPs for her deal.
The first would be adding a backstop expiry date to the Withdrawal Agreement and the second would be a unilateral backstop exit mechanism for the UK.
Asked how she intended to persuade people to accept a Brexit deal that does not contain a backstop, Mrs May replied: "I am not proposing to persuade people to accept a deal that does not contain that insurance policy for the future.
"What Parliament has said is that they believe there should be changes made to the backstop.
"It is in that vein, in that light, that we are working with politicians across Westminster of course, across the House of Commons, but also we will be working with others... to find a way that enables us to maintain our commitments that we have set very clearly for no hard border.
"But to do it in a way that provides a Withdrawal Agreement and a political declaration for the future that can command support across the House of Commons and therefore that we will be able to ratify with the European Union such that we leave on the 29th of March with a deal."
MPs voted last week to say they would only back Mrs May's Brexit deal if the backstop was replaced by "alternative arrangements".
Brussels has long maintained that the Withdrawal Agreement cannot be reopened and that the backstop contained within it cannot be changed.
"While the commission's position is clear, we are waiting to see what the Prime Minister has to say," European Commission spokesman Margaritis Schinas told reporters on Tuesday morning.
Mrs May is expected to meet with Arlene Foster, the leader of the DUP, and other political parties in Northern Ireland on Wednesday before then heading to Brussels on Thursday.
It came as Angela Merkel, the German Chancellor, insisted “there is still time” to find a solution to the Brexit impasse as she said it should be “humanly possible” to resolve the backstop issue.
Speaking at an economic conference in Tokyo, Ms Merkel said: "From a political point of view, there is still time. That should be used, used by all sides.
“But for this it would be very important to know what exactly the British side envisages in terms of its relationship with the EU."
Ms Merkel said the “special” problem remained the Irish border and the backstop agreement but added: "It should be humanly possible to find a solution to such a precise problem.
“But this depends... on the kind of trade deal that we forge with each other.”

World Cup boost for UK and Ireland

A joint UK and Ireland bid to host the football World Cup would help strengthen relations across the Irish Sea post-Brexit, the Prime Minister has said.
Theresa May described the "tantalising" prospect of hosting the 2030 tournament as she outlined ways to bolster the bilateral relationship with the Irish Republic when the UK leaves the EU.
Diplomatic ties between London and Dublin, which have improved markedly in recent decades, have been put under renewed strain during the Brexit process.
On a visit to Belfast on Tuesday, Mrs May said people on both islands "yearned" for a "close and trusting" relationship.
Mrs May said recent joint UK and Irish commemorations to mark the sacrifices of the First World War demonstrated the strength of the bilateral links.
"Today those ties of family and friendship between our countries are more important than they have ever been," she added.

'I implore you from the bowels of Christ' 

Deputy political editor Steven Swinford has some colourful insight into the May loyalists' attempts to win over MPs.
Hearing Geoffrey Cox, in an attempt to win support for his 'joint interpretative instrument' solution to the backstop, told one member of the ERG that he implored them 'from the bowels of Christ' to back it.
Does not sound like ERG are convinced...
— Steven Swinford (@Steven_Swinford) February 5, 2019

Theresa May rules out deleting backstop from Withdrawal Agreement

The Prime Minister has just answered questions from members of the press.
She was asked how she intends to persuade people to accept a Brexit deal that does not contain the backstop.
She replied: "I am not proposing to persuade people to accept a deal that does not contain that insurance policy for the future.
"What Parliament has said is that they believe there should be changes made to the backstop and it is in that vain, in that light, that we are working with politicians across Westminster of course, across the House of Commons, but also we will be working with others, with the Irish government and with the EU, to find a way that enables us to maintain  our commitments that we have set very clearly for no hard border but to do it in a way that provides a Withdrawal Agreement and a political declaration for the future that can command support across the House of Commons and therefore that we will be able to ratify with the European Union such that we leave on the 29th of March with a deal."

Theresa May vows never to compromise on Northern Ireland's 'integral place' in UK

The Prime Minister says "I understand what a hard border would mean" for the island of Ireland both in terms of people's daily life but also for trade.
She vows never to compromise on protecting Northern Ireland's "integral place" within the United Kingdom and says there will be no new regulatory barriers put up without the sign off of Stormont.
Mrs May says it is "more important than ever" that all voices are heard in Northern Ireland as she announces she will tomorrow meet with members of every political party for Brexit talks.
She says the UK Government will not allow the return of a hard border and adds: "I will not let that happen."
The Prime Minister is also stressing the importance of the UK/Ireland relationship which she describes as "deeper than with any of the other" 27 EU countries.

Theresa May reiterates need for legal changes to Brexit backstop

Speaking in Belfast, the Prime Minister says the UK has "come a long way" over the last two and half years towards finding a post-Brexit solution to ensuring there is not a hard border on the island of Ireland.
Mrs Mays says she wants to "reaffirm her commitment" to avoiding a hard border and to the Good Friday Agreement.
Mrs May says her commitment to unionism will "never change" and the United Kingdom "I stand for is an open and tolerant" collection of nations.
The Prime Minister says she "accepted the need for an insurance policy" to protect against a hard border and that was why she agreed to the backstop in the Withdrawal Agreement.
Mrs May says she "fought hard" to persuade MPs to support her original deal but now accepted that it needed to change.
She says she can only get a Brexit deal through Parliament if "legal changes" are made to her deal.

Nick Clegg summoned by MPs to give evidence on social media abuse

Two pieces of news relating to two former heavyweight members of the House of Commons this lunch time:

1. Tony Blair 

The Labour former prime minister "spent most of the time looking out the window" during meetings with Scottish government leaders, a peer has claimed.
Giving evidence to Westminster's Scottish Affairs Committee on the relationship between the UK and Scottish Governments, Lord Wallace said the alleged daydreaming occurred during Joint Ministerial Committees (JMCs).
The Liberal Democrat peer, who was Scotland's deputy first minister from Scottish devolution until 2005, with short spells as interim first minister, said: "The Joint Ministerial Committee as it were at the top level of Prime Minister, Deputy Prime Minister, First Minister, Deputy First Minister.
"I remember meeting in Edinburgh, in Cardiff and by the time it came to the third meeting in Downing Street, I don't think I'm exaggerating to say that Tony Blair spent most of the time looking out the window."

2. Nick Clegg 

The former deputy prime minister who is now a senior Facebook executive has been summoned to give evidence to a parliamentary committee about abuse of MPs on social media.
Sir Nick, who was appointed the social media platform's head of global affairs in October, will be quizzed by the Joint Human Rights Committee over concerns that online abuse is inhibiting MPs' ability to serve their constituents and undermining the effective functioning of democracy.
The committee of MPs and peers has also invited Twitter to send a representative to a hearing in Westminster, expected in March.
In a letter to Sir Nick, the committee's chairwoman Harriet Harman said members had been "disturbed" to hear evidence from MPs about "significant" levels of abuse, threats and intimidation they receive on social media.

Downing Street confirms Thursday talks with EU

Christopher Hope, the Telegraph's chief political correspondent, has been at the morning lobby briefing with Number 10 and was given a run down of today's Cabinet meeting.
The Prime Minister’s spokesman said: “Cabinet agreed that it was positive that for the first time Parliament had indicated that it could support the Withdrawal Agreement subject to changes to the backstop and that it had reiterated its commitment to both avoiding a hard border and leaving the EU with a deal.
“The Prime Minister said that our objective now is to secure a legally-binding way of guaranteeing we cannot be trapped indefinitely in the backstop.
“To achieve this we have launched urgent pieces of work examining alternative arrangements to the backstop and considering legal changes that could provide a unilateral exit mechanism or a time limit to the backstop.
“The PM said the discussions with the EU will not be easy but Parliament has sent a clear message that a change to the backstop is the only way to get a deal approved.
“The PM added that last week showed that a second referendum does not have the support of the House. She said that while Labour did not whip for the Brady amendment Jeremy Corbyn said he also has concerns about the backstop, so this is an issue that needs to be resolved not just for our [Conservative] colleagues and the DUP but for MPs across the House.”
The spokesman added that there was no discussion, apart from a brief mention, of the UK delaying its exit from the EU.
He said: “If there was any at all it was reiterating the determination to leave on March 29th. It only came up very fleetingly.”
The spokesman also confirmed that Gavin Barwell, Mrs May’s chief of staff, went to Brussels yesterday for talks “with EU politicians”.
He confirmed that Mrs May will go to Brussels on Thursday for talks with Jean-Claude Juncker, the EU President.
Mrs May is expected to travel alone to Brussels without any ministers from her team, The Telegraph understands.

Theresa May set for Thursday morning meeting in Brussels

The Prime Minister's crunch meeting with Jean-Claude Juncker on Thursday is expected to take place at 11am Brussels' time.
It is also thought Mrs May will meet separately with Donald Tusk, the President of the European Council, although that is yet to be confirmed.

EU: Backstop a 'central piece' of Brexit deal 

Asked if Theresa May would present an alternative to the backstop at her meeting with Jean-Claude Juncker on Thursday, Commission spokesman Margaritis Schinas said: "Let's see how the meeting develops on Thursday."
He added the backstop was a "central piece" of the Withdrawal Agreement and of "fundamental importance" to addressing the issues around the Irish border.

Theresa May to visit Brussels on Thursday

Jean-Claude Juncker, the president of the European Commission, will meet Mrs May on Thursday, an EU spokesman said.
"While the commission's position is clear, we are waiting to see what the prime minister has to say," European Commission spokesman Margaritis Schinas told reporters on Tuesday.
The spokesman said Mrs May would come to the commission's Berlaymont headquarters a day after Ireland's Prime Minister Leo Varadkar's talks on Wednesday with EU leaders.

People's Vote campaigners: Backstop or no backstop, Brexit deal still bad news for Northern Ireland

Anna McMorrin, a Labour MP and supporter of the People’s Vote campaign, said that regardless of the backstop, Theresa May's deal was "still bad news for Northern Ireland".
“Backstop or no backstop, the deal will deepen divides in Northern Ireland. Today whether a resident of Northern Ireland holds an Irish or a British passport makes no difference to their rights and their status.
"That is the very foundational principle of the Good Friday Agreement. Backstop or no backstop that will change after Brexit.
“Northern Ireland voted against Brexit and all the polling shows that opposition to leaving the EU has only grown. Yet the voice of those in Northern Ireland who oppose Brexit goes unheard in our Parliament and so the majority of citizens of Northern Ireland are left unrepresented on this crucial matter.
“Instead of playing another round of fantasy Brexit, the Prime Minister should hand this decision back to the public in a People’s Vote.”

Liam Fox 'planning to cut import tariffs to zero in no-deal Brexit' 

The International Trade Secretary is reportedly working on a no-deal contingency plan which would see tariffs on all imports to the UK cut to zero.
The Huffington Post website said Dr Fox is contemplating using ministerial powers to make a last minute change to the Trade Bill, currently making its way through Parliament, which would allow the Government to make sweeping changes to the tariff schedule if inflation increased dramatically after a disorderly Brexit.
The plan has sparked fears in the manufacturing industry that the UK market could be flooded with cheap foreign goods.
Perhaps most interestingly a spokesman for Dr Fox apparently did not shoot the story down, saying: “No decision has been taken and the Government is currently considering all options in the event of a no-deal with the EU.”

Chris Grayling: Brussels to blame if no Brexit deal agreed

The Transport Secretary told The Telegraph in an exclusive interview that the EU would have to "take responsibility" if the UK leaves the bloc without an agreement.
“We have taken to our parliament the deal reached in November and our parliament has said no,” he said.
“We want to work with the EU to reach a deal but if they are not prepared to do that – they will have to take responsibility that we are heading towards a no-deal exit.
“If they are not willing to compromise, if they’re not willing to work with us to find common ground – it will be down to them if there is no deal.”
Mr Grayling also discussed Nissan's U-turn and dismissed suggestions Article 50 could be extended.
You can read the interview in full here.

DExEU runs up £45,000 bill for printing Withdrawal Agreement

The Department for Exiting the European Union printed some 1,300 copies of the Withdrawal Agreement at an overall cost of £45,637.
Each document runs to almost 600 pages and, according to the BBC, which obtained the figures using Freedom of Information laws, many of them remain uncollected in Parliament.
Theresa May is currently trying to change the Withdrawal Agreement which will mean the document will likely have to be reprinted in its entirety if and when the time comes for MPs to vote on a new version.
DExEU said the cost included "secure deliver and handling of the document".

Angela Merkel: Still time to fix Brexit deal

The German Chancellor is in Japan on an official visit and she has told an economic conference in Tokyo that there is still time to find a way forward on Brexit.
She said: "From a political point of view, there is still time.
"That should be used, used by all sides. But for this it would be very important to know what exactly the British side envisages in terms of its relationship with the EU."
Acknowledging that the tight timeframe was difficult for businesses desperate for certainty given "just-in-time" production systems, Ms Merkel said the "special" problem was the Irish border and the backstop agreement.
"It should be humanly possible to find a solution to such a precise problem. But this depends ... on the kind of trade deal that we forge with each other," she said.

Arlene Foster: Backstop would lead to break up of United Kingdom

The DUP leader is due to meet with Theresa May in the coming days when she is expected to reiterate her party's opposition to the backstop.
Ms Foster said that if the backstop issue is resolved then her party would back the Prime Minister's Brexit deal.
But she would not be drawn on what solution to the backstop would be acceptable to her when she spoke to the BBC's Today programme this morning.
Removing the backstop from the Withdrawal Agreement, inserting an expiry date or creating a unilateral exit mechanism for the UK have all been floated as potential solutions.
But Ms Foster said: "I think it is for the Prime Minister obviously to negotiate in relation to these matters. I am not certainly going to get caught up in the semantics of all of that this morning.
"I think Brussels has been asking for a clear ask from the United Kingdom Government and they now have that clear ask.
"They have known all along that the backstop causes great difficulties, particularly for those of us who are unionists in Northern Ireland."
Ms Foster said the backstop as currently designed ultimately risked the break up of the United Kingdom.
Arlene Foster, the DUP leader  Credit: Yui Mok/PA
She said: "The current backstop as I have said all along is toxic to those of us living in Northern Ireland and indeed for unionists across the United Kingdom because it would cause the break up of the United Kingdom into the medium and longer term and I think that is something that people are very concerned about."
Ms Foster said creating a border between Great Britain and Northern Ireland was not an acceptable price for avoiding a hard border.
She said: "We cannot have a border between Great Britain and Northern Ireland to replace a border on the island of Ireland.
"That just would be madness for the economy of Northern Ireland."
She also said the DUP would support the Prime Minister's deal if the backstop issue was resolved.
“We have been very clear on all occasions that if the backstop is dealt with in the Withdrawal Agreement then despite the fact that we may have misgivings around other parts of the Withdrawal Agreement we will support the Prime Minister because we do want Brexit to happen in an orderly and sustained fashion,” she said.

Government to pay law firm £800,000 for Brexit legal advice over potential Eurotunnel row

The Government has awarded an £800,000 contract to a law firm for advice in case Eurotunnel takes legal action over the impact of Brexit.
Lawyers at Slaughter and May will provide support to the Department for Transport (DfT) in the "highly likely" event that Eurotunnel pursues litigation.
In January, Eurotunnel, part of the Getlink group, accused the Government of "distortionary and anti-competitive" behaviour over the award of contracts worth more than £100 million to provide additional cross-Channel capacity in the case of a no-deal Brexit.
Transport Secretary Chris Grayling defended giving a contract worth almost £14 million to Seaborne Freight - a firm with no ships.
Getlink chief executive Jacques Gounon wrote to Mr Grayling to voice "serious concern" about the decision to award contracts to three ferry companies.
Mr Gounon said Getlink "reserve all our rights to challenge such a measure both in the UK and France".
He argued that Eurotunnel's Le Shuttle service was the "most efficient way" to supply vital goods to the UK and would remain so even if new border procedures were introduced after Brexit.
Chris Grayling, the Transport Secretary Credit: Toby Melville/Reuters
A description of the contract awarded to Slaughter and May on a Government website says it is "to obtain an external legal resource to provide advice and assistance to DfT on the Cross-Channel Rail Services".
But the BBC said the wording had been changed and had previously said that Getlink had "expressed concern that their business may be disturbed or interfered with... and that this will in turn hit their profits".
It added: "It is highly likely that they would seek to protect their business and profits through litigation against the department."
A spokesman for the DfT said the Government routinely sought legal advice.
He added: "This multi-annual contract is to provide advice on a wide range of areas relating to the Channel Tunnel and EU exit."
Seaborne aims to operate freight ferries from Ramsgate in Kent to the Belgian port of Ostend, beginning with two ships in late March and increasing to four by the end of the summer. Eurotunnel declined to comment.

Sir Keir Starmer opens door to free movement of workers after Brexit

The shadow Brexit secretary was on the BBC's Newsnight programme last night and he suggested he would be happy with free movement of workers after the UK has left the European Union.
Sir Keir was asked if he could live with the idea of a “Norway Plus” Brexit in which you would not have free movement of citizens but you would have free movement of workers.
He replied: “Well, that would have to be explored, and the precise, detail of this, but before I was shadow Brexit secretary, I was shadow immigration secretary and I went round the country talking about immigration.
"From these discussions, although there are obviously different views, I think most people would agree that if somebody is coming to do a job and it needs to be done and it has been advertised locally beforehand with nobody able to do it, then most people say ‘I would accept that’.
Sir Keir Starmer Credit: David Young/PA
“Most people say that if this is about family reunification, if you are coming to join your family, that is something I can accept.
“And most people I think would say, if somebody wants to come here to study, and is genuine, then of course please come and study. In fact, let’s celebrate that.
“So I actually think we get stuck on the freedom of movement discussion too early without saying ‘well, what does a principled, effective and fair immigration policy look like?’
“Now I am not setting one out here, I’m just saying that needs to be the debate and when we get into that debate, we may find we can make better progress than we think.”

Lord Trimble accuses EU and UK of 'breaking promise' to protect Belfast Agreement

The former leader of the Ulster Unionist Party has accused the EU and UK of breaking promises made in the Good Friday Agreement as he confirmed he is exploring legal action over the terms of the Brexit deal.
Lord Trimble, one of the architects of the Northern Ireland peace process who won a Nobel Peace Prize for his work on the agreement, is working on the plans to challenge the deal in the High Court in London.
He told the BBC: "In the agreement, both British and Irish governments undertook to support the agreement and what they have done, both of them, they have broken that promise."
Lord Trimble also accused the EU of a "raid" on the Belfast Agreement.
He said: "What Brussels is worried about is that Ireland could become a backdoor whereby goods that don't meet their regulatory standards come in.
"That can be solved by putting ion place undertakings on businessmen to ensure goods coming in have the requisite regulatory provisions.
"That is where Brussels has a good case. What it doesn't have a good case for is having this raid on the Belfast Agreement's provisions and to hold out for something that is going to do serious damage to Northern Ireland and indeed to Northern Ireland's place inside the United Kingdom which is always going to be a huge problem for us."

Source: The Telegraph