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Apple leapfrogs Nvidia as value soars by $150bn

The Apple logo on a mobile phone screen in front of a computer screen displaying Apple Intelligence logo yesterday
The 'Apple' logo on a mobile phone screen in front of a computer screen displaying Apple Intelligence logo yesterday - Hakan Nural/Anadolu via Getty Images

Apple’s stock market value surged by almost $150bn (£112bn) and hit a new record high the day after it announced a deal to add ChatGPT to hundreds of millions of iPhones.

Shares in Apple climbed by 5pc on Tuesday, valuing the technology business at more than $3.1 trillion, leapfrogging rival Nvidia and closing the gap on Microsoft, the world’s most valuable listed company.

The gains came after Apple revealed a host of updates to its iPhone software, iOS, that will be powered by artificial intelligence (AI). These included tools that will use AI to redraft and edit emails or blog posts, an app for creating synthetic artwork and customisable AI-emoji.

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The tech giant also disclosed a deal with OpenAI, the developer of popular chatbot ChatGPT, which will plug the start-up’s machine-learning smarts into Apple’s Siri voice assistant as well as across its iPhone software for free. This should allow Siri to respond to more complicated queries when called upon.

Rather than being contained to a separate app, Apple’s AI advances - which it dubbed “Apple Intelligence” - will be featured across its iOS smartphone software - from iMessages to photos.

Apple has been facing questions over whether it had fallen behind rivals in the race to adopt AI technology in its gadgets. The launch of OpenAI’s ChatGPT bot in late 2022 has created a groundswell of interest in AI and Google and Microsoft each unveiled new software updates that rely on the technology last year.

Both had made moves ahead of Apple, with Google adding its Gemini chatbot app to its smartphones, while Microsoft has worked with OpenAI to develop its Copilot technology that plugs into its Windows operating system.

Apple has also endured falling iPhone sales, with revenues from its flagship product dropping by 10.5pc in its latest quarter.

However, its latest product announcements sent Apple’s shares as high as $205. Dan Ives, a technology analyst at Wedbush Securities, said the new product’s features should “spur an AI-driven iPhone upgrade cycle starting with iPhone 16”.

Richard Windsor, an independent technology analyst, said: “This is an answer to the critics who have accused Apple of having nothing when it comes to generative AI services, but it remains to be seen if these offer a boost to the quality of the user experience in the Apple ecosystem.”

Read the latest updates below.


06:16 PM BST

Signing off...

Thanks for joining us today. Chris Price will be back in the morning before the London markets open to cover the latest business news.

I’ll leave you with news that Argentina’s monthly inflation rate is expected to come in at 4.9pc in May in a potential boost for its president Javier Milei.

The figure comes from a Reuters poll of analysts published today, suggesting an inflation rate that would be the slowest rise since the end of 2022.

Mr Milei has made inflation-busting a key focus since taking office in December during a major economic crisis. Argentina’s annual inflation, near 300pc, is the highest in the world.

Mr Milei has cut public spending in an attempt to avoid hyperinflation and has pledged a zero fiscal deficit policy, boosting markets and investor sentiment even as the real economy has creaked.

The Indec statistics agency is scheduled to release the official data on Thursday.

Javier Milei gestures during a commemoration of the 214th anniversary of the May Revolution that led to the independence from Spain, last month
Javier Milei gestures during a commemoration of the 214th anniversary of the May Revolution that led to the independence from Spain, last month - Diego Lima/AFP via Getty Images

06:05 PM BST

Trump ally urges Jeremy Hunt to investigate Shein’s ‘slave labour and sweatshops’

A US senator in the race to be Donald Trump’s presidential running mate has urged Jeremy Hunt to investigate claims Shein uses “slave labour and sweatshops”. Hannah Boland reports:

Marco Rubio, who has been named as a potential Republican vice presidential candidate, sent a letter to the Chancellor this week calling for an investigation ahead of Shein’s potential £50bn London stock market listing.

In a letter sent to Mr Hunt this week, seen by The Telegraph, Mr Rubio said he felt a “duty of friendship” to warn Britain over the risks associated with allowing Shein to join the London Stock Exchange.

Mr Rubio highlighted concerns about “unethical and irresponsible business practices”, adding: “Slave [sic] labor, sweatshops, and trade tricks are the dirty secrets behind Shein’s success.”

The letter, which was also sent to Nikhil Rathi, chief executive of the Financial Conduct Authority, comes amid mounting pressure on ministers and officials to increase scrutiny of Shein.

Read the full story...


05:49 PM BST

British cloud company suffers share price drop despite posting higher revenues

Shares in a British cloud computer company that supplies the Government fell today amid sluggish growth.

Iomart, which owns 12 data centres around the country with customers including the BBC and BT, told investors that its profits for the year to the end of March had risen 2pc to £8.7m, while turnover had jumped 10pc to £127m.

However, it cut its final dividend by 14pc to 3p a share compared with the previous year.

Lucy Dimes, the executive chairman, said: “We paid an interim dividend of 1.94p per share to shareholders in January 2024 and the Board is now proposing to pay a final dividend of 3.00p per share taking the total for the year to 4.94p. This would represent the maximum pay-out ratio under our stated dividend policy of paying up to 50% of adjusted diluted earnings per share. We believe this is appropriate given our funding position, robust business model and strength of our balance sheet.

The shares dropped 3.5pc today.


05:23 PM BST

FTSE 100 has worst day in nearly two months

London’s FTSE 100 fell 1pc today, weighed down by financial stocks tracking broder losses in European markets as political uncertainty spooked investors and weakness in industrial miners further weighed on the market.

The benchmark FTSE 100 index’s decline marked its worst day in nearly two months while the mid-cap FTSE 250 index slipped 0.9pc after touching its lowest in over a month.

Non-life insurers fell 2.7pc, the worst hit sector, while bank stocks lost 2.3pc.

Susannah Streeter, head of money and markets at Hargreaves Lansdown, said:

What we are seeing is a knock-on effect about the political uncertainty emanating from France that has affected banking stocks.

There is a real concern (that) the far right parties are enjoying a surge of popularity across Europe and with their more populist policies, which is a higher spending, that has led to concerns for the financial sector.

Industrial miners recorded their worst day in over a month, declining 1.9pc. They fell in tandem with copper prices that hit a seven-week low on a stronger dollar, rising inventories and weak indicators in China. Data showed that the British unemployment rate rose to 4.4% in April from 4.3%.

Focus is now on a key inflation reading in the United States on Wednesday, followed by the Federal Reserve’s next decision on interest rate cuts.


05:21 PM BST

FirstGroup reports bumper profits after boost from Lumo

FirstGroup reported bumper profits on Tuesday, pointing to the contribution of two of its rail companies that could escape nationalisation under Labour plans.

It told investors that its two open access train companies, which operate without a management contract from the Government, had performed strongly. Labour has said that such operators “will remain where it adds value and capacity to the rail network”.

Lumo, which runs between London and Edinburgh, saw revenues jump 42pc in the 53 weeks to the end of March, while Hull Trains, which connects London and Hull, had 40pc higher revenues.

FirstGroup warned that nationalisation was a “principal risk” for the business but said there was “considerable scope to grow” open access services.

Underlying profits jumped 40pc to £136.8pc.


05:14 PM BST

Footsie closes down

The FTSE 100 dropped 1pc today. Hikma Pharmaceuticals was the biggest riser, up 2.2pc, followed by Rentokil Initial, up 1.4pc. The biggest faller was copper miner Antofagasta, down 4.3pc, followed by Standard Chartered, down 4.3pc.

Meanwhile, the FTSE 250 fell 0.9pc. The top riser was Oxford Instruments, up 7.1pc, followed by vending machine operator ME Group, up 4.7pc. The biggest faller was magazine publisher Future,d own 5.2pc, followed by Wag Payments, down 4.3pc.


04:26 PM BST

Boeing sales tumble with no orders for the 737 Max for the second month in a row

Boeing received orders for only four new planes in May - and for the second straight month, none for its best-selling 737 Max, as fallout continues from the blowout of a side panel on a Max during a flight in January.

The results released today compared unfavourably with Europe’s Airbus, which reported orders for 27 new planes in May.

Boeing also saw Aerolineas Argentinas cancel an order for a single Max jet, bringing its net sales for the month to three.

The dismal results followed poor figures for April, when Boeing reported seven sales - none of them for the Max.

Boeing hopes that the slow pace of orders reflects a lull in sales before next month’s Farnborough International Airshow, where aircraft deals are often announced.

Boeing, based in Arlington, Virginia, delivered 24 jetliners in May, including 19 Max jets. Ireland’s Ryanair got four and Alaska Airlines took three. Airbus said it delivered 53 planes last month.

Despite the slow pace of recent sales, Boeing still has a huge backlog of more than 5,600 orders.


04:24 PM BST

British biotech pays £5m over claims Covid tests were faulty

A British biotech business that produced thousands of Covid-19 tests during the pandemic has agreed to pay the Government £5m to settle claims they were defective. Hannah Boland reports:

Novacyt said it had struck a deal with the Department of Health and Social Care ahead of a High Court trial scheduled to take place this week.

Under the settlement, Novacyt is making a £5m payment to the Government. Shares in Novacyt plunged almost a fifth on the news. The company has lost around 95pc of its value since early 2020.

It brings an end to a lengthy and bitter row between the Government and Novacyt over the Covid-19 tests, which centred around claims that the tests “failed at an unacceptable rate”.

The Department of Health and Social Care launched a lawsuit against Novacyt and subsidiary Primer Design Ltd in early 2022, suing them for £145m over claims they breached their 2020 contract by selling the Government thousands of PCR tests which failed at “unduly high” levels.

Novacyt was paid to deliver 288,000 kits per week to the NHS at the height of the pandemic in early 2020.

However, concerns about the kit were raised by the Government’s validation group, which assessed how sensitive tests were and whether they produced false negatives.

The tests were never rolled out by the NHS.

Novacyt and Primer Design had claimed evidence suggesting their tests failed to spot Covid-19 was “seriously and obviously flawed”.

They argued that errors had been made in assessing the laboratory results.

Novacyt and Primer Design had launched a counter claim for £70m over three unpaid invoices.

Following the settlement, the cases will now no longer proceed to trial. Neither party made any admission of liability or wrongdoing in respect of the claim or counterclaim or otherwise.


04:16 PM BST

French AI champion valued at $6bn just year after foundation

A French rival to OpenAI co-founded by an ally of Emmanuel Macron has secured a valuation of almost €6bn (£5bn) a little over a year after it was founded. Matthew Field has the details:

Mistral, a Paris-based start-up launched in April 2023, has secured more than €600m from investors including US venture capital fund General Catalyst, Nvidia, Samsung and Salesforce.

Mistral, which was founded by Arthur Mensch, Timothee Lacroix, Guillaume Lample and the former French digital minister Cédric O, has developed a digital chatbot that competes with OpenAI’s ChatGPT.

Technology giants including Microsoft, Google and Amazon have been ploughing billions of dollars into artificial intelligence (AI) start-ups such as OpenAI.

Mistral represents one of the sole European businesses considered to be in close competition with OpenAI and its Silicon Valley peers.


04:10 PM BST

Disgraced former BHS bosses face costs of up to £179m over retailer’s collapse

Former BHS directors are facing liabilities of up to £179m after a damning High Court judgment over failures during the collapse of the high street chain. Hannah Boland reports:

In a landmark decision, Mr Justice Leech said Lennart Henningson, a former director for BHS, and Dominic Chandler, BHS’s former general counsel, were liable for wrongful trading, misfeasance trading and misfeasance.

The charges relate to how they managed the retailer in the run-up to appointing administrators. Wrongful trading occurs when directors are found to have kept a business trading when it was clear that it was insolvent and would not be able to avoid liquidation.

It is closely linked to misfeasance, which is a term used to refer to wrongdoing by directors that may have caused loss to a company.

The High Court judgment follows a lengthy battle by BHS’s liquidator FRP to recoup money for creditors, which has included agreeing settlements with the retailer’s former owner Sir Philip Green. Sir Philip sold BHS in 2015 for £1 to Dominic Chappell, a former racing car driver.

The retailer went into administration a year later, leaving a pension black hole of £571m and resulting in 11,000 job losses. Sir Philip later agreed to pay £363m into the BHS pension scheme, following calls for him to be stripped of his knighthood.

In its wrongful trading case, FRP had claimed that BHS directors ran through the remaining cash and property assets of BHS through “a mixture of incompetence and greed”.

The London judge, in his ruling, said the directors’ actions had breached the threshold for wrongful trading. Mr Henningson and Mr Chandler have been told to each pay liquidators an initial £6.5m.

However, the High Court judge suggested that the potential liability for wrongful trading could be as high as £45.5m and up to £133.5m for misfeasance trading. He said he would be giving both Mr Henningson and Mr Chandler the opportunity to make submissions on what the appropriate measure of equitable compensation should be, given the scale of the potential penalties and the fact that this was a developing area of law.

A closed BHS store in Glasgow, 2022
A closed BHS store in Glasgow, 2022 - Emily Macinnes/Bloomberg

04:03 PM BST

New iPhone AI to get iPhone sales out of the dollrums

Artificial intelligence will mean the iPhone 16 - expected this autumn - will prove a hit with Apple users who have otherwise been resistent to upgrades, an analyst has said.

Dan Ives, a Wedbush Securities analyst, noted that 270m iPhones have not been upgraded in four years. He said:

We estimate 15pc-plus of the Apple installed base will upgrade to iPhone 16 as Apple Intelligence is the killer app many have been waiting for.

Apple’s iPhone revenue for its financial year to September 2023 was $200.6bn (£157.7bn), down from $205.5bn the year before.


03:52 PM BST

Musk urges shareholders to back his bumper pay as voting edges towards a close

Elon Musk took to X this afternoon to urge Tesla shareholders to back a bumper $56bn (£44bn) payment for running the electric car manufacturer, with just two days left for voting.

The serial entrepreneur wants to move the incorporation of the company from Delaware to Texas, after a Delaware judge, Kathaleen McCormick, ruled against the incentive plan, describing it as “unfathomable”.


03:35 PM BST

Handing over

As uncertainty grips the markets, you can be certain you will get all the latest updates here as I hand over the reins to Alex Singleton for the rest of the day.

The FTSE 100 remains down 1.1pc, with the pound up 0.2pc against the euro, which is worth 84.4p. Sterling is down 0.1pc against the dollar at $1.272.

US stocks have joined the European sell-off as markets took a cautious approach ahead of a Federal Reserve decision and inflation data.

The Dow Jones Industrial Average was down 0.6pc, the S&P 500 was down 0.4pc and the Nasdaq Composite was down 0.1pc.


03:17 PM BST

Apple shares hit new record high amid plans to integrate ChatGPT

Apple shares have risen to a record high after the tech giant announced a deal to integrate ChatGPT into the iPhone, iPad and Mac.

Shares in the world’s most valuable company gained 3.5pc in early trading to hit $199.83.

As part of its generative AI announcements on Monday, Apple said that alongside its new Apple Intelligence system that will allow users to access generative AI-powered tools almost anywhere within their devices, it would give users the option to send a query to ChatGPT to take advantage of its own spectrum of knowledge.

The surge in interest comes despite Tesla chief executive Elon Musk warning he could ban Apple devices from his companies over what he called an “unacceptable security violation”.

Apple chief executive Tim Cook revealed his company's AI plans during its annual Worldwide Developers Conference
Apple chief executive Tim Cook revealed his company's AI plans during its annual Worldwide Developers Conference - NIC COURY/AFP via Getty Images

03:09 PM BST

Alaska Airlines loses appeal in £125m Virgin trademark dispute

Alaska Airlines has lost an appeal in a $160m (£125m) trademark case with Virgin Group after a ruling last year that Sir Richard Branson’s company was entitled to royalties even though the US airline no longer uses the Virgin brand.

The British group successfully argued that Alaska is liable to pay a roughly $8m “minimum royalty” payment every year until 2039.

It said a 2014 trademark licence agreement between Virgin and Virgin America Inc, which was acquired by Alaska’s parent company in 2016, required the annual payment even if Alaska stopped using its branding.

A judge at London’s High Court ruled last year that the minimum royalty was “a flat fee payable for the right to use the Virgin brand, whether or not that right is taken up”.

Alaska Airlines, which had argued that an agreement requiring it to pay $8 million a year for trademarks it has no intention of using was “commercially nonsensical”, tried to overturn that ruling.

But the Court of Appeal in London rejected its appeal today, with Judge Stephen Phillips saying in a written ruling that Virgin’s interpretation of the agreement was correct.

Alaska Airlines has lost an appeal against a $160m ruling in favour of Virgin
Alaska Airlines has lost an appeal against a $160m ruling in favour of Virgin - REUTERS/Mike Blake

02:51 PM BST

World Bank raises growth prediction for global economy

The World Bank has upgraded its outlook for the global economy, estimating that it will expand 2.6pc this year on the strength of sustained growth in the United States.

The bank’s latest outlook marks an increase from the 2.4pc growth for 2024 it had predicted in January.

It would match the global economy’s 2.6pc expansion in 2023.

The agency cautioned that global growth remains sluggish by past standards, that the poorest countries are struggling under the weight of heavy debts and high interest rates and that increased trade barriers endanger prosperity worldwide.

The brutal wars in Ukraine and Gaza are inflicting further pressures on regional economies.


02:34 PM BST

Wall Street falls at opening bell

US stock indexes fell as investors turned cautious ahead of crucial inflation data and a policy announcement from the Federal Reserve expected on Wednesday.

The Dow Jones Industrial Average fell 72.33 points, or 0.2pc, at the open to 38,795.71.

The S&P 500 opened lower by 7.79 points, or 0.2pc, at 5,353.00, while the Nasdaq Composite dropped 32.10 points, or 0.2pc, to 17,160.42 at the opening bell.


02:30 PM BST

Former Cabinet Office boss becomes EDF chairman

EDF Energy has recruited Sir Alex Chisholm, formerly one of the most senior officials in Whitehall, as chairman of its UK business.

The French state-owned energy giant said Sir Alex will join next month after the Government’s Advisory Committee on Business Appointments gave the hire the green light.

He was previously permanent secretary at the Cabinet Office, meaning he was the most senior figures at the central government department aside from elected ministers.

Sir Alex said his appointment comes “at a time of great change and opportunity in the energy sector”. He said:

EDF continues to invest in nuclear, wind, solar and battery infrastructure to offer customers secure, clean and affordable electricity.

I look forward to getting to know all parts of the company, and to helping EDF serve the needs and priorities of the UK.

He arrives as EDF faces potentially spiralling costs and delays on its Hinkley Point C nuclear plant, which is being built in Somerset.

Sir Alex Chisholm was the permanent secretary at the Cabinet Office from 2020 until April this year
Sir Alex Chisholm was the permanent secretary at the Cabinet Office from 2020 until April this year - Christopher Pledger

02:08 PM BST

FTSE 100 on track for biggest fall in two months

The FTSE 100 has now sunk more than 1pc amid the Europe-wide sell-off triggered by Emmanuel Macron’s snap election.

The drop in the UK’s blue-chip index is the biggest one day decline since April 16.

The biggest faller is miner Antofagasta, which is down 4.2pc amid falling iron ore and copper prices.


01:50 PM BST

Former NatWest boss joins private equity

Dame Alison Rose, the former chief executive of NatWest who was forced to quit in the wake of the Nigel Farage debanking scandal, has got a new job.

She has been hired as a senior adviser to Charterhouse, the private equity group which used to own AA and Saga. Financial News first reported the story.

Dame Alison took up the job in April at the firm, which manages about £5bn of assets.

Dame Alison Rose has taken a job at private equity group Charterhouse
Dame Alison Rose has taken a job at private equity group Charterhouse - Dominic Lipinski/PA Wire

01:31 PM BST

Mortgage arrears at highest level in nearly a decade

The value of mortgages with arrears has risen to a near 10-year, as borrowers feel the pain from high interest rates.

Our senior economics reporter Eir Nolsøe has the details:

New figures from the Bank of England show the value of mortgages with arrears rose by 4.2pc in the first three months of the year to £21.3bn from the previous quarter.

The rise marks a 44.5pc increase from a year earlier and brings it to the highest level since July to September 2014.

The figures suggest that even as mortgage defaults remain low by historical standards, borrowers are struggling amid 16-year-high interest rates.

It comes as the lending to borrowers with large loans relative to how much they earn hit the lowest level since 2016, suggesting borrowing costs are pricing out buyers with lower earnings.

Bank of England figures show mortgage arrers are at their highest level since 2014
Bank of England figures show mortgage arrers are at their highest level since 2014 - Victoria Jones/PA Wire

01:13 PM BST

French borrowing costs on track to surge by most since pandemic

French government borrowing costs are on track for their biggest increase since the pandemic after Emmanuel Macron called a shock snap election.

France’s 10-year bond yield - the return the government promises to pay buyers of its debt - jumped 6.5 basis points to 3.3pc after surging 12 basis points a day earlier.

Monday’s rise was its biggest one-day jump in 11 months and if today’s gains hold it would be the biggest two-day jump in French bond yields since March 2020.

It has left the difference between French and German government borrowing costs at its widest point since 2020.


12:57 PM BST

Wall Street on track to fall ahead of inflation figures

US stocks are expected to fall when trading begins as investors hold back ahead of inflation figures and the next interest rate decision by the Federal Reserve.

The S&P 500 and the Nasdaq posted record closing highs on Monday in a choppy session, boosted by shares of Nvidia after its 10-for-one stock split.

Nvidia dipped 0.3pc in premarket trading, while shares of Apple lost 0.4pc after investors were left unimpressed by the long-awaited AI strategy presented at its developer conference on Monday.

Markets are readying for Wednesday’s release of the consumer prices index for May, along with the conclusion of the Fed’s two-day policy meeting.

The central bank is not expected to change rates, but will release its updated economic projections and the so-called “dot plot” indicating where policymakers think interest rates are heading.

Markets are pricing in a 54.4pc chance that the Fed’s first rate cut will happen in September, according to the CME’s FedWatch tool.

In premarket trading, the Dow Jones Industrial Average was down 0.4pc, while the S&P 500 and Nasdaq 100 were down 0.3pc.


12:49 PM BST

Abba Voyage creator in talks to create Elvis hologram show

The creator of Abba Voyage is said to be in discussions to create a new hologram show that will bring Elvis Presley back to life.

Our reporter James Warrington has the details:

Pophouse, a Swedish entertainment firm co-founded by Abba star Björn Ulvaeus, is exploring plans to launch a live show featuring the singer in avatar form.

The company has held talks with Sony Music, which owns the rights to Elvis’ songs, as well as Authentic Brands Group, which owns his image and likeness, to partner on the project.

If confirmed, it would be the second Elvis hologram show to go into development in recent months.

Read how media companies and rights owners look to emulate the enormous success of Abba Voyage.

Swedish entertainment firm Pophouse is in talks with Sony Music, which owns the rights to Elvis' songs
Swedish entertainment firm Pophouse is in talks with Sony Music, which owns the rights to Elvis' songs - Gary Null/NBC/NBCU Photo Bank via Getty Images

12:20 PM BST

UK markets slump amid Europe-wide sell-off

The FTSE 100 has lost ground as European stocks extended a sell-off fuelled by EU political uncertainty.

The UK’s blue chip index was last down 0.9pc on the day, while the Cac 40 in Paris was down 0.9pc and the Dax in Frankfurt had dropped 0.6pc.

The midcap FTSE 250 was down 0.4pc.

Tickmill Group analyst Patrick Munnelly said investors were “carefully assessing the impact of right-wing parties’ success in the European Union and its potential effects on the bloc’s unity”.

Far-right parties performed well in weekend EU Parliament elections, prompting French President Emmanuel Macron to call a snap parliamentary vote and sparking political turmoil in his country.

Ratings agency Moody’s has warned that Macron’s move could lower France’s credit score because it raises the risk of “political instability”.


11:54 AM BST

Rishi Sunak launches Tory manifesto

Rishi Sunak is unveiling the Conservative Party’s general election manifesto at Silverstone as he attempts to get the Tory campaign back on track.

The series of election pledges include 30 hours of free childcare, spending 2.5pc on defence by 2030, abolishing stamp duty on homes worth up to £425,000 for first time buyers and another 2p cut to National Insurance.

Jack Maidment is covering the manifesto launch in our politics live blog, and you can watch it below:


11:37 AM BST

Pound at 22-month high against euro

Sterling has hit a 22-month high against the euro following the move to the far-right in the European Parliament elections and Emmanuel Macron’s decision to call a snap poll.

The pound was up 0.3pc against the single currency, which is worth 84.3p.

Sterling was up 0.1pc versus the dollar to $1.274 as investors await US inflation data and the outcome of the Federal Reserve policy meeting on Wednesday.


11:11 AM BST

Oil holds after biggest jump since March

Oil held the biggest jump since March ahead of an Opec report that will provide a snapshot on the market outlook.

Brent traded down 0.1pc below $82 a barrel after surging 2.5pc on Monday, while West Texas Intermediate was above $77.

The Opec report will be followed by a Short-Term Energy Outlook from the US later on Tuesday, and a monthly release from the International Energy Agency on Wednesday.

Crude rallied on Monday as traders decided to “buy the dip” after the biggest weekly loss since early May following a decision by Opec+ to restore some supply later this year. The selloff prompted the group to clarify it could pause or reverse production changes if needed.

Yeap Jun Rong, market strategist with IG Asia, said: “Market participants are hoping to tap on some optimism around upcoming summer demand.”


10:47 AM BST

French borrowing costs outpace European rivals

The difference between French and German government borrowing costs has reached its widest point since October after Emmanuel Macron announced a snap election in the wake of his party’s humiliating defeat in Europe.

The yield on 10-year French bonds - the return that the government promises to pay buyers of its debt - has risen to 3.28pc, compared to 3.1pc before the poll was announced.

It is rising at the fastest pace among major European economies today and has hit its highest level since November.

By contrast, the 10-year yield on German bunds, the benchmark for the continent, stands at 2.65pc.

The yield on UK gilts has fallen today to 4.28pc after a sale of government debt attracted a record £104bn of bids, according to Bloomberg News.


10:33 AM BST

Moody’s warns of French credit downgrade after Macron’s election shock

France’s government faces a potential downgrade in its credit rating after Emmanuel Macron announced a shock snap election.

Ratings agency Moody’s warned that “potential political instability is a credit risk” in France, where the “debt burden is the highest among similarly rated peers”.

The President called the poll following a humiliating defeat in the European Parliament elections to Marine Le Pen’s National Rally.

Investors are worried that Mr Macron’s gamble could allow Ms Le Pen to seize control of the French National Assembly, the country’s parliament, and therefore tax and spending.

National Rally has not released an official manifesto yet but traders fear Ms Le Pen will be more free-spending than the President at a time when France’s deficit stood at 110.6pc of GDP in 2023.

Moody’s anticipates this could rise to almost 115pc of GDP by 2027, leaving France “more susceptible to a rising cost of funding”.

In a note to clients, Moody’s analysts said: “The outlook, and ultimately the ratings, could move to negative if we were to conclude that the deterioration in debt affordability – which we measure as interest payments relative to revenue and GDP – will be significantly larger in France than in its rating peers.”

Marine Le Pen's National Rally could seize control of France's parliament and Moody's has warned that an increase in the country's deficit could leave it susceptible to higher interest payments
Marine Le Pen's National Rally could seize control of France's parliament and Moody's has warned that an increase in the country's deficit could leave it susceptible to higher interest payments - REUTERS/Gonzalo Fuentes

10:18 AM BST

China premier to visit Australia in bid to improve trade ties

China’s Premier Li Qiang will travel to Australia this weekend on the highest-ranking visit in seven years, Canberra announced, as the two nations’ trade ties improve despite their strategic rivalry in the Pacific.

Li’s four-day trip, which begins Saturday, comes after Beijing lifted most of the trade barriers it had imposed several years ago on Australian exports including coal, timber, barley, and wine.

The Chinese premier’s visit “represents another important step in stabilising our relationship with China,” Prime Minister Anthony Albanese told a news conference.

He said: “Australia continues to pursue a stable and direct relationship with China, with dialogue at its core.”

Australian Prime Minister Anthony Albanese will host China's Premier Li Qiang
Australian Prime Minister Anthony Albanese will host China's Premier Li Qiang - HOW HWEE YOUNG/EPA-EFE/Shutterstock

09:54 AM BST

Labour uncertainty puts future of Port Talbot steel making at risk, says owner

Tata Steel has said it is “apprehensive” that its plans to close its blast furnaces “may be put in peril” by an incoming Labour government.

The steelmaking giant said it will continue with its restructuring plans in the coming months, costing thousands of jobs in South Wales, despite the Labour Party urging it to delay the decision until after the General Election.

Tata said: “The company confirms that it will continue with the announced closure of the heavy end assets and restructuring program at Port Talbot in the coming months.”

Tata is moving to a greener form of production, using an electric arc furnace - which needs fewer workers, leaving jobs at risk. The plan involves investing £1.3bn in greener technology.

“Over the last three years (Tata Steel has) worked hard to develop a sustainable future for Tata Steel UK and the Port Talbot Plant,” the statement said.

The company urged political parties “to adhere to and safeguard the agreed terms” of its plan to restructure its UK operations.

Tata has insisted the reduction in roles, which was first announced in January, is necessary to stop the company from making £1m a day in losses.

Alasdair McDiarmid, assistant general secretary at the Community union, said: “It would be wrong for Tata to make irreversible decisions before such a consequential election.”

Tata said it will close the blast furnaces at the Port Talbot steelworks in South Wales
Tata said it will close the blast furnaces at the Port Talbot steelworks in South Wales - Ben Birchall/PA Wire

09:41 AM BST

FirstGroup issues warning on Labour renationalisation as profits grow

Bus and train company FirstGroup has cautioned about the possibility of renationalisation of UK railways if Labour wins the General Election.

Both the Conservatives and Labour have put forward plans to overhaul UK railways, with Labour pledging to renationalise nearly all passenger rail services within five years if it emerges victorious at the polls next month.

Labour has said it would look to fold existing private passenger rail contracts into a newly created public body as they expire.

FirstGroup warned: “A change of UK Government could lead to policy changes resulting in the renationalisation of the National Rail contracts within the First Rail division as the expiry dates of our various agreements with the Department for Transport are reached.”

The company runs three major UK train operating companies - Avanti West Coast, Great Western Railway and South Western Railway - as well as two open-access passenger rail services, Hull Trains and Lumo.

Chief executive Graham Sutherland insisted that a rebound in passenger numbers, alongside improvements to stations and trains, “demonstrates that the UK rail industry works best as a public-private partnership”.

FirstGroup added that industrial action, which has plagued the UK rail sector in recent years, remains a challenge.

It posted a 27pc jump in underlying operating profits to £204.3m for the year to March 30 - though this was helped higher by an extra week’s trading and the receipt of higher variable fees in First Rail than the previous year.

First Group operates to Avanti West Coast mainline
First Group operates to Avanti West Coast mainline - Christopher Furlong/Getty Images

09:21 AM BST

Record long-term sickness ‘now a threat to Britain’s growth’

The number of people who said they could not work because of long-term sickness rose by another 55,000 to 2.83m, according to the Office for National Statistics.

Our deputy economics editor Tim Wallace has the latest:

The rise in long-term sickness means the worklessness crisis has reached a scale that threatens to undermine the economy’s growth potential, according to Tony Wilson, director of the Institute for Employment Studies. He said:

This Parliament has seen the largest rise in economic inactivity and largest contraction in the size of the workforce since comparable records began in 1971.

And this just isn’t happening in other countries, with the UK virtually the only developed economy where the employment rate has fallen since the Covid-19 pandemic.

We need to address this urgently because when employment stops growing the economy stops growing too.

Reforming employment support needs to be a top priority for the next Parliament, so that more people can get access to the help that they need to get back into work and get on in work.


08:55 AM BST

UK markets rise amid hopes for interest rate cuts

The FTSE 100 has risen after rising unemployment and falling vacancies indicated the jobs market is cooling in Britain - thus keeping alive hopes of interest rate cuts later this year.

The UK’s benchmark index rose by 0.2pc while the midcap FTSE 250 was up by 0.3pc.

The pound slipped 0.1pc against the dollar and was last at $1.272.

The unemployment rate in Britain for April rose to 4.4pc from 4.3pc but wages including bonuses grew by more than expected at 5.9pc.

Traders are now expecting nearly a 60pc chance of a September rate cut by the Bank of England. The central bank meets in less than two weeks from now to take a call on borrowing costs.

Among individual stocks, Rio Tinto lost 2.2pc and was the top loser on the FTSE 100 as the mining giant said it will buy Mitsubishi Corp’s 11.7pc stake in Boyne Smelters (BSL) for an undisclosed sum.

Anglo American fell as much as 1.9pc after Morgan Stanley resumed coverage on the stock with an “equal-weight” rating.

Bucking the trend, Oxford Instruments surged 10pc to the top of the FTSE 250 after the nanotechnology tools maker reported its full-year results above estimates.


08:39 AM BST

Raspberry Pi jumps on first day of trading

Raspberry Pi shares jumped on the micro computer maker’s first day as a public company, offering a boost to London’s market for new stock listings.

Raspberry Pi shares traded at 360 pence each at the open, well above its initial public offering (IPO) price of 280 pence. The stock gained as much as 36pc.

The company, which makes low-cost computers popular with amateur coders and teachers, had a market capitalisation of about £542m after pricing the IPO at the top end of its range.

The small deal has been seen as a boost for London, which has fallen behind in this year’s revival in listings in Europe.

Raspberry Pi founder and chief Eben Upton holds company shares worth around 2.2pc
Raspberry Pi founder and chief Eben Upton holds company shares worth around 2.2pc - David Rose

08:27 AM BST

Employment data are ‘headache’ for Bank of England, say economists

The latest jobs figures have given “mixed signals” to the Bank of England, according to economists.

Rising unemployment and falling vacancies have given a sign that the labour market is weakening, which would boost the chance of rate cuts.

However, rising wages risks fuelling inflation.

Jake Finney, economist at PwC UK, said the latest ONS data “presents a headache for the Bank of England”.

He said: “A broad set of indicators suggests that the labour market is cooling but pay growth has not fallen to the extent they would like to see.”

Other economists agree, with Simon French of Panmure Gordon saying wage growth remains “too hot”:


08:10 AM BST

Heathrow breaks passenger record

In corporate news, Heathrow has recorded its highest passenger total for a 12-month period.

Europe’s busiest airport said 81.5m passengers travelled through its terminals in the year to the end of May.

That is up from 71.6m during the previous 12 months.

Heathrow recorded double-digit year-on-year percentage growth in passengers for routes connecting the airport with other parts of the UK and Europe, as well as North America and the Asia/Pacific region.

The airport had its busiest ever May with 7.2 million passengers, compared with 6.7 million in the same month last year.

Heathrow chief executive Thomas Woldbye said:

We have a winning team at Heathrow which has proven that we have put Covid firmly behind us.

Thanks to their extraordinary efforts we are now giving record numbers of people the chance to connect smoothly with the world.

Supporting 81m journeys doesn’t just help families to make wonderful holiday memories, importantly it is about the vital trade and business links a hub like Heathrow creates for the UK’s economy.

Heathrow has experienced its busiest 12-month period
Heathrow has experienced its busiest 12-month period - Akabei/iStock Editorial

08:04 AM BST

UK markets open higher despite rising wages

The FTSE 100 has shrugged off figures showing higher-than-expected wage growth in Britain.

The UK’s blue chip stock index gained 0.4pc after markets opened to 8,258.68 while the midcap FTSE 250 has risen 0.3pc to 20,500.53.


08:01 AM BST

Interest rates should be cut in August, say economists

Rises in unemployment and job vacancies should give the Bank of England confidence to cut interest rates in August despite rising wage growth, economics have said.

Thomas Pugh, economist at RSM UK, said:

Today’s data will make pretty uncomfortable reading for the MPC. But it is clear the labour market is loosening and forward-looking indicators suggest pay growth will slow, combined with a further fall in inflation in May, that should be enough to justify the Bank of England following the ECB with a rate cut in August.

The punchy 0.6pc m/m increase in private sector regular pay in April was enough to keep headline total pay growth at 5.9pc.

However, we estimate at least half of this monthly increase was due to the one-off 9.7pc increase in the national minimum wage.

Indeed, the labour market continues to loosen with employment dropping by another 139,000 in the three months to April and the unemployment rate rising to 4.4pc.

Overall, strong pay growth makes an August rate cut a little less likely, but with inflation likely back to 2pc and a big picture of slow growth, the time is right for the MPC to ease off the break.

Ruth Gregory, deputy chief UK economist at Capital Economics, added that the “stickiness” of wage growth “may not stop the Bank from cutting interest rates for the first time in August, as we are forecasting, as long as other indicators such as pay settlements data and next week’s CPI inflation release show decent progress”.


07:51 AM BST

Worklessness ‘now a threat to growth’ as long-term sickness hits record

The number of people with long-term sickness has hit a record high as worklessness reaches a scale that economists think has become a threat to growth in the economy.

In the three months to April, there were 9.43m people who were economically inactive in Britain, meaning they are neither in a job nor looking for one.

These included a record number of people out of work due to long-term sickness, which rose 55,000 to 2.83m.

It means the worklessness crisis has reached a scale that threatens to undermine the economy’s growth potential, according to Tony Wilson, director of the Institute for Employment Studies.

He said: “This Parliament has seen the largest rise in economic inactivity and largest contraction in the size of the workforce since comparable records began in 1971.

“And this just isn’t happening in other countries, with the UK virtually the only developed economy where the employment rate has fallen since the Covid-19 pandemic.

“We need to address this urgently because when employment stops growing the economy stops growing too. Reforming employment support needs to be a top priority for the next Parliament, so that more people can get access to the help that they need to get back into work and get on in work.”

The number of economically inactive workers has risen by 883,000 people since before the pandemic.

The ONS said: “Increases in economic inactivity over the latest quarter were largely because of those aged 50 to 64 years.

“Meanwhile, the annual increase was largely because of those aged 16 to 24 years.”


07:41 AM BST

Unemployment rises and vacancies fall in sign of weakening jobs market

Although wage growth remains resilient, Britain’s unemployment rate has risen to its highest rate since the summer of 2021 in a sign that the jobs market is weakening further.

The Office for National Statistics (ONS) said the rate of UK unemployment lifted to 4.4pc in the three months to April, up from 4.3pc in the three months to March.

The latest increase defied expectations for the jobless rate to remain unchanged and sees it reach the highest level since July to September 2021.

Vacancies also dropped sharply once again, down 12,000 to 904,000 in the three months to May, marking the 23rd fall in a row.

But the figures showed regular earnings growth - excluding bonuses - remained unchanged at 6pc in the three months to April.

Pay also continued to outstrip price rises - rising by 2.9pc when taking inflation into account, which is the highest since 2002 when excluding the pandemic.

The ONS said: “This month’s figures continue to show signs that the labour market may be cooling, with the number of vacancies still falling and unemployment rising, though earnings growth remains relatively strong.”


07:34 AM BST

Bank of England ‘unlikely’ to be impacted by jobs figures, say economists

The latest official wage growth figures are “mixed” and “unlikely” to impact the Bank of England’s decision on interest rates, say economists.

Yael Selfin, chief economist at KPMG UK, said:

Wage growth remained elevated in April as the 10pc hike in the National Living Wage was enough to temporarily arrest the downward momentum in pay.

Based on today’s release, we estimate that the rise in the National Living Wage boosted the overall level of pay by around 0.1pc, although the current headline rate somewhat underestimates the impact because it is reported as a three-month average.

Overall, today’s data are unlikely to warrant an immediate shift in policy from the Bank of England. We expect the MPC to stay put at its June meeting and reassess the incoming data flow over the summer before it embarks on cutting interest rates.

NIESR associate economist Monica George Michail added that the “persistence of wage growth also raises concerns about stickier inflation, prompting the Bank of England to remain cautious about interest rate cuts”.

The Bank of England announces its next interest rate decision on June 20, when markets give a less than 10pc chance of an interest rate cut.


07:21 AM BST

Real pay rises at fastest pace since 2021

The latest employment data showed that UK average regular earnings, excluding bonuses, grew by 6pc in the three months to April, according to the Office for National Statistics said.

This was unchanged from the three months to March.

Real pay, which takes into account the impact of inflation, rose by 2.9pc when excluding bonuses, which was the highest since the three months to August 2021.

Excluding the pandemic, when furlough impacted the figures, that is the strongest since 2002.


07:11 AM BST

Good morning

Thanks for joining me. We begin with a look at the latest data on wages, which have grown at a faster pace than expected.

Total pay grew by 5.9pc in the three months to April, official figures show, in a blow to hopes of summer interest rate cuts.

5 things to start your day

1) Higher share of pensioners pay income tax than working people for first time, says IFS | The number of working-age people who are neither employed nor job-hunting has surged since Covid

2) Labour plotting wave of tax raids drawn up by IMF, claims senior Tory | Dame Harriett Baldwin warns triple lock at risk under a Starmer government

3) PwC accused of ‘deeply flawed’ audit in legal row with Lucky Strike maker | Big Four firm failed to exercise reasonable care and skill, claims tobacco giant

4) Volkswagen to sell solar panels for charging electric cars | Car giant says move will reduce costs for drivers by up to 40pc

5) IPhone users can ask AI to write their emails in deal with OpenAI | Apple announced new features as seeks to show it has an answer to rival Google’s AI tools

What happened overnight

Asian stocks were subdued as investors pondered the implications of fresh political uncertainty in European markets after right-wing gains in the EU parliament elections and a snap poll in France.

Moves were mostly modest, with MSCI’s broadest index of Asia-Pacific shares outside Japan dipping 0.5pc in thin trading.

Chinese blue chips fell 1.2pc, having been shut on Monday, while the yuan hit a seven-month low.

Going the other way, Japan’s Nikkei rose 0.3pc and South Korea stocks rose 0.4pc.

On Wall Street, the S&P 500 and the Nasdaq Composite index managed to mark their second record closing highs in four days. The S&P 500 gained 0.3pc, reaching 5,360.79, and the Nasdaq Composite gained 0.4pc, closing at 17,192.53. The Dow Jones Industrial Average of 30 leading American companies rose 0.2pc, to 38,868.04.

The yield on benchmark US 10-year notes rose to 4.469pc, from 4.428pc late on Friday.