News updates from July 9: Powell hails progress in tackling US inflation; Moscow court orders arrest of Alexei Navalny’s widow

Tesla shares closed higher for the 10th consecutive session, its longest winning run in just over a year and one of its longest on record.

The electric-vehicle maker’s stock rose 3.7 per cent on Tuesday to a nine-month high, taking its gain over the past 10 sessions to 43.7 per cent and leaving it up 5.5 per cent this year.

It is Tesla’s longest winning run since its record 13-day streak that topped out on June 13 2023. It also ranks as one of four such streaks in the stock’s history that have lasted 10 or more sessions, according to a Financial Times analysis of LSEG data.

No other stock in the Magnificent Seven — the group of Big Tech companies in which Wall Street includes Tesla — has achieved a winning streak longer than 12 sessions, according to FT analysis. Apple is the one to top out at one dozen.

Donald Trump has demanded that European countries contribute some $100bn to Ukraine in order to “equalise” US support for Kyiv.

Trump posted on Truth Social moments before US President Joe Biden was set to kick off the 75th Nato summit in Washington. He took credit for Nato’s current strength, saying “billions of dollars” poured into the alliance after he as president urged members to contribute more, but he said Nato allies are not pulling their weight with Ukraine.

“The US is paying most of the money to help Ukraine fight Russia. Europe should at least EQUALISE! They owe more than 100 Billion to do so,” he wrote.

As a bloc, European countries have committed more to Ukraine than the US has, according to the Kiel Institute for World Economy. Europe has allocated at least €102bn to Ukraine since 2022, while the US has allocated €74bn.

The S&P 500 closed at a record high for the fifth session in a row as bond yields edged higher and as investors looked ahead to the next round of inflation data due on Thursday.

The S&P 500 and the Nasdaq Composite both closed 0.1 per cent higher on Tuesday. The S&P has risen for six sessions in a row, its longest positive run since a January streak of the same length. The Nasdaq’s minor gain helped it to sixth record-high close in a row.

In government debt markets, the 10-year Treasury yield inched up 0.03 percentage points to just under 4.3 per cent, as the price of the debt instrument slipped lower.

Europe’s first new heavy-lift rocket in almost 30 years lifted off from its launch pad near Kourou in French Guiana on Tuesday, ending a year-long crisis over the region’s ability to fly its own satellites into orbit.

Ariane 6, four years late and heavily subsidised to ensure it can compete against Elon Musk’s SpaceX, lifted off at about 4pm local time. The lower stage separated smoothly about eight minutes into the flight, after the Vulcain engines were cut off and reignited. It now begins a three-hour mission to carry 17 satellites and experiments into orbit, and to test its innovative reigniteable engine.

The launch restores Europe’s independent access to space. After the retirement of Ariane 5 last July, the collapse of collaboration with Russia’s Soyuz, and delays to the smaller Vega-C rocket, the bloc has been without its own launch capability.

Stress levels are increasing among European Central Bank staff, according to a poll, which found almost 40 per cent of its employees are at risk of burnout and 9 per cent have suicidal thoughts.

The survey results, seen by the Financial Times, show workplace anxiety in the ECB has increased in recent years. Some staff say they suffer from exhaustion, while others feel they lack control, are treated unfairly or are offered inadequate support.

The findings of the poll, which was carried out in April and May at the request of the ECB’s staff committee, elected by workers at the central bank, have prompted union officials to call for workers’ wellbeing to be taken more seriously.

Read more here

US stocks were muted in afternoon dealings on Tuesday, after Federal Reserve chair Jay Powell said the central bank had made “considerable progress” in its fight against inflation but was awaiting more data before cutting interest rates.

Wall Street’s S&P 500 gauge and the technology-heavy Nasdaq Composite were both 0.1 per cent higher after lunchtime in New York. Those small gains helped the indices to hit intraday records, with the Nasdaq crossing 18,500 points for the first time.

In government bond markets, the 10-year Treasury yield edged up 0.03 percentage points to 4.3 per cent, reflecting a small drop in the benchmark debt instrument’s price.

Tulip Siddiq, a longtime ally of Sir Keir Starmer, is to be appointed City minister in the new Labour government, continuing with the portfolio she held in opposition, according to senior Labour insiders.

Siddiq has been a familiar figure in the financial services sector since her appointment to the shadow City minister brief in December 2021. 

She has stressed the need for stability and continuity, largely embracing reforms introduced by former Tory chancellor Jeremy Hunt.

“We are not coming in and ripping up all the legislation,” she told the Financial Times in December. At the time, she added there was a perception that Labour had been “sneering at business” under Jeremy Corbyn’s Labour party, but the relationship had been transformed under Starmer’s leadership. 

French stocks notched up their biggest one-day drop since mid-June as talks to form a government continued following Sunday's inconclusive second-round vote.

The Cac 40 in Paris closed 1.6 per cent lower on Tuesday. That was its biggest fall since June 14, just days after President Emmanuel Macron’s decision to call a snap parliamentary election ushered in a bout of volatility for the country’s financial markets.

Every sector in the index finished in negative territory at the end of the trading session. Software company Dassault Systemes closed 5.5 per cent lower after cutting its forward guidance, while banks BNP Paribas and Société Générale lost 2.9 per cent and 2.6 per cent, respectively.

The region-wide Stoxx Europe 600 fell 1 per cent — also its biggest drop since mid-June — dragged lower by energy groups and industrials. Germany's Dax shed 1.3 per cent and London's FTSE 100 fell 0.7 per cent.

A Moscow court has charged Yulia Navalnaya, widow of Kremlin critic Alexei Navalny, with participating in an “extremist association” and ruled to arrest her in absentia.

Navalnaya, who is no longer in Russia, has promised to continue her husband’s work since his death in a Russian prison earlier this year and is now the chair of his Anti-Corruption Foundation, an investigative group also based outside of Russia. 

Russia outlawed the group as well as Navalny’s nationwide network of activists in 2021, labelling them extremist. 

US stocks barely budged while Treasuries slipped slightly as Federal Reserve chair Jay Powell said “more good data” is needed before the central bank deems inflation on track to return to its 2 per cent target. 

Wall Street’s benchmark S&P 500 and the tech-heavy Nasdaq Composite were 0.2 per cent and 0.4 per cent higher as Powell delivered prepared remarks to the US Senate Banking Committee on Tuesday. Both indices were trading at similar levels before Powell began to speak.

Yields on interest rate-sensitive two-year Treasuries rose 0.02 percentage points to 4.64 per cent, reflecting a small decline in prices. Yields on 10-year Treasuries rose 0.04 percentage points to 4.31 per cent. 

Ireland’s government has announced plans for an €8.3bn budget for 2025, including a nearly 7 per cent increase in public spending, prioritising health and tax measures ahead of a general election widely expected this autumn.

The financial package, to be presented to the Dáil, Ireland’s parliament, on October 1, earmarked an additional €1.5bn in funding for the health service and €1.4bn in tax measures designed to protect workers from higher taxes arising from wage inflation.

Ireland’s election is not due until March but the main opposition party, Sinn Féin, has recently plunged in opinion polls, which many analysts believe could tempt the government to go early.

Sir Keir Starmer has called on MPs to “replace the politics of performance with the politics of service” in his first speech in the House of Commons as UK prime minister.

“The need to restore trust should weigh heavily on every member here, new and returning alike,” he said.

“We all have a duty to show that politics can be a force for good. So whatever our political differences, it’s now time to turn the page, unite in a common endeavour of national renewal and make this new parliament a parliament of service.”

Starmer was speaking shortly after Sir Lindsay Hoyle was re-elected as speaker of the House of Commons.

US stocks rose in early trade on Tuesday as investors looked ahead to the start of earnings season and crucial inflation data due out later this week.

Wall Street’s blue-chip S&P 500 gained 0.2 per cent shortly after the New York opening bell, with Nvidia, Airbnb and Micron Technology among the best performing stocks. The tech-dominated Nasdaq Composite rose 0.4 per cent. 

PepsiCo, Delta Airlines, and banks Citigroup, JPMorgan and Wells Fargo are among the first S&P 500 companies due to release their latest results on Thursday and Friday. But “for broader market influence, [consumer price inflation and producer prices] are probably going to be the true drivers of price action,” said Mike Zigmont, head of research at Harvest Volatility Management.

Talks between new health secretary Wes Streeting and junior doctors were “positive and constructive”, according to people close to the British Medical Association, bolstering hopes a line may be drawn under the lengthy industrial action.

Streeting and representatives from the doctors’ union discussed why previous talks went wrong and how they can navigate past those issues, according to people briefed on the discussions. They will meet again next week.

Those briefed on the BMA’s position said they appreciated Streeting’s “sense of urgency to resolve the dispute [which] was shown by how quickly we were invited to DHSC after the general election”.

They noted that the BMA had not been invited to DHSC, to meet former health secretary Victoria Atkins, for almost six months. 

A Labour-commissioned review into a new flagship £7bn “national wealth fund” has called for the money to be spent through an existing body at first to ensure “speed to market” of investment cash.

The wealth fund is a major plank in Labour’s “green prosperity fund” along with a new state-owned GB Energy to invest in low-carbon electricity projects and money for insulating millions of homes. 

In March, Rachel Reeves, who is now chancellor, commissioned a taskforce — to examine how best to implement the NWF — made up of leading figures from the UK financial services sector  — including former Bank of England governor Mark Carney, who now chairs asset manager Brookfield.

The group said that the NWF’s capital should initially be managed and deployed by an existing organisation or organisations in Britain to ensure “speed to market” with the UK Infrastructure Bank the most obvious “fit”.

The price of coffee is set to soar further as climate change, shipping disruptions and new EU regulations drive up costs for roasters, according to the chair of Italian coffee group Lavazza.

“Coffee prices are not going to go down, [they’re] going to stay very high” said Giuseppe Lavazza. “The coffee supply chain is dramatically under pressure”.

The price of London robusta coffee futures, the global benchmark, has risen strongly over the past year. Lavazza said the price of coffee on UK supermarket shelves had gone up about 15 per cent compared to 2023.

Coffee roasters had been forced to put up their prices and reduce their profit margins as the cost of the raw material had surged, said Lavazza, attributing this to falling supplies as a result of climate change.

Dyson is axing about 1,000 jobs in the UK, more than a quarter of its workforce in the country. 

Staff at the vacuum cleaner and air filter manufacturer were told on Tuesday morning about the redundancies, which are part of a wider move to reduce the company’s 15,000-strong global workforce, according to people familiar with the matter. 

The job cuts are a blow to the UK and come on the same day that the new secretary of state for business, Jonathan Reynolds, gathered more than 100 business leaders on a call to set out his priorities. 

Read more here.

Powell: Federal Reserve chair Jay Powell will deliver his semi-annual testimony before the Senate committee on banking, housing and urban affairs. Lawmakers are expected to grill Powell on monetary policy and the economy.

Fedspeak: Fed governor Michelle Bowman is due to deliver remarks at a conference on financial inclusion. Bowman, who is a voter on the Fed’s rate-setting committee, warned in late June that the central bank may have to raise interest rates again if inflation does not budge from its current level.

The number of non-doms in the UK rose by 7 per cent to 74,000 in the 2022-23 tax year, according to data released by HMRC on Tuesday.

The data also shows that they paid £8.9bn in tax in the year — up 6 per cent on the previous year.

Non-doms — or non-domiciled people — are UK residents deemed to have their permanent home or “domicile” outside the country and so may not need to pay UK tax on foreign income or capital gains

Labour has promised to scrap the non-dom status and replace it with a new system, a move which has led to increased reports of wealthy non-doms leaving the country.

Shareholders in Hipgnosis Songs Fund have backed a $1.6bn takeover bid from US private equity group Blackstone, bringing to an end six years on the British public market for the UK music rights owner.

Investor support for the offer has come despite moves by a group of US and UK hedge funds to acquire a potential blocking stake in Hipgnosis since the takeover deal was agreed with the board earlier this year.

In response, Blackstone made clear last month that its offer — which followed a bidding war against a rival private equity-backed group — was final. The group needed three-quarters of the votes at a meeting held on Monday to approve the deal. Almost all shareholders voting at the meeting backed the takeover.

Former Labour prime minister Tony Blair warned that if the UK government does not embrace the potential of AI, “the future is one in which we’re going to be poorer”.

“The only long term solution . . . is the full embrace of this technology revolution,” he told the BBC’s Today Programme, arguing that around 40 per cent of tasks done in the public sector could be performed by machine learning technology.

He said the government could ramp up the use of AI by changing its procurement systems.

Blair also argued that the UK’s NHS could be transformed from a system that focuses on cure to prevention if it finds a way to harness the data at its disposal.

French stocks led European indices lower on Tuesday as investors mulled a period of political gridlock following Sunday’s inconclusive election.

The Cac 40 in Paris fell 0.9 per cent, with tech and energy stocks among the worst performers. Germany’s Dax lost 0.5 per cent but London’s FTSE 100 rose 0.2 per cent. The region-wide Stoxx Europe 600 fell 0.4 per cent.

The euro was steady against the dollar at $1.0824.

The single currency “appears to be waiting for cues from French coalition talks, with scenarios ranging from a left-wing government to a market-friendly technocrat prime minister,” said analysts at ING.

Shares in pharma group Indivior slumped by 37 per cent on Tuesday morning after it warned that sales and profits for the year would be lower than expected.

Sales of Sublocade, its treatment for opioid addiction, and Perseris, a treatment for schizophrenia, will both be lower than the company had previously forecast. The company said it would stop selling Perseris because the product is “no longer financially viable”.

Adjusted operating profits for the year will come in at $285mn-$320mn, down from previous expectations of $330mn-$380mn.

BP expects to take an impairment charge of up to $2bn to its second-quarter results, partly because of a review of refining activities in Germany it announced in March.

The energy major said on Tuesday that it expects its second-quarter results to be hit by “post tax asset impairments and one-off contract provisions of between $1bn and $2bn”, which includes the hit from the scaling back of refining operations at the Gelsenkirchen refinery from 2025, due to high costs and declining demand for fuels.

BP also said that lower refining margins would hit its earnings by $500mn to $700mn.

Global recruitment firm PageGroup has warned on profits, as geopolitical tensions and economic uncertainty continued to hit the jobs market.

Announcing a 12 per cent slump in second-quarter gross profits to £224mn, the UK-listed company, which operates in 37 countries, said it continued to see “challenging” market conditions.

“We experienced a softening in activity levels through the quarter, particularly in terms of new jobs registered and number of interviews,” said the group in a statement.

“Given the weaker than expected trading in June, recent increased geopolitical and macroeconomic uncertainty and consequently a more cautious view for [the second half], the board now expects full year 2024 operating profit to be in the region of £60mn”

Analysts had previously been expecting profits of about £90mn.

Thames Water has urged financial regulator Ofwat to agree to a business plan that will make the company “investable”, as it vowed to raise new equity.

The company, which provides water and sewage services to about 16mn households, has spent the past year fighting to stave off collapse and temporary nationalisation.

Reporting annual results on Tuesday, chief executive Chris Weston said he continued to believe that a “market led solution that increases financial resilience is in the best interests of all stakeholders, but it is dependent on securing a final regulatory determination that is deliverable, financeable and investable, as well as affordable for our customers.”

Chinese stocks declined on Tuesday even as Japanese indices hit record highs, driven by gains in companies with exposure to artificial intelligence demand.

Hong Kong’s Hang Seng index dropped 0.5 per cent as the Hang Seng Mainland Properties index, which includes Chinese developers with listings in the city, shed 4.9 per cent.

China’s benchmark CSI 300 edged down 0.1 per cent. Shares in two of the country’s largest state-owned lenders, Bank of China and Industrial and Commercial Bank of China, have declined 10 per cent in the past week.

In Japan both the benchmark Topix and exporter-oriented Nikkei 225 hit record highs as the share prices of companies with AI exposure rose.

China and Belarus began joint military exercises in a region next to Poland on Monday ahead of the annual Nato summit in Washington, according to the countries’ defence ministries.

The operations are “near Brest”, China’s ministry of defence said. Brest borders Nato member Poland and is just 200km from Warsaw.

China and Belarus said the exercises, named “Attacking Falcon”, are “anti-terrorist operations”. According to Belarus, they are practicing “night landing, overcoming water obstacles, and conducting operations in a populated area”.

Belarus is closely aligned with Russia, which has military stationed in the country. Last year Russian President Vladimir Putin announced Russia would move tactical nuclear weapons to Belarus, which joined the China-led Shanghai Cooperation Organisation last week.

Australia, backed by key allies including the US, UK and Japan, has accused a Chinese state-backed cyber hacking group of targeting the country’s government and private sector networks and detailed its methods. 

The move to name and detail the actions of the group APT40 by the Australian Signals Directorate is unprecedented and was made less than a month after Li Qiang, China’s premier, visited Australia to rebuild ties. 

The statement was backed by security and intelligence agencies from the US, UK, Canada, New Zealand, Germany, South Korea and Japan.

They cited a “shared understanding” of the threat posed by a Chinese “state-sponsored cyber group and their current threat to Australian networks”. 

Asian equities with exposure to artificial intelligence demand rose on Tuesday as investors pile into the sector.

Japan’s Topix gained 0.4 per cent, with semiconductor precision toolmaker Disco, robotics group Keyence and chipmaker Tokyo Electron driving gains in the country’s benchmark index.

Taiwan’s Taiex rose 0.4 per cent in early trading as Taiwan Semiconductor Manufacturing Co gained 0.5 per cent. TSMC is the world’s largest chip foundry and a key supplier to the artificial intelligence boom.

Elsewhere in the region, Australia’s benchmark S&P/ASX 200 index rose 0.7 per cent and Singapore’s Straits Times index added 0.5 per cent.

Guangzhou R&F Properties has become the latest Chinese developer to face a legal challenge in Hong Kong’s courts after it received a winding up petition from a creditor.

The petition was brought by Seatown Private Credit Master Fund over an outstanding loan of $614mn in principal and interest, the company said in an exchange filing on Tuesday.

Multiple other Chinese developers are facing winding up petitions in Hong Kong amid a prolonged downturn in the country’s vast real estate sector.

Evergrande, the world’s most indebted developer, was ordered to liquidate earlier this year in Hong Kong, though the order has limited application in mainland China unless it is recognised by courts there.

Events: New Zealand Prime Minister Christopher Luxon travels to the US for the Nato summit. Guinea-Bissau President Umaro Sissoco Embaló, Solomon Islands Prime Minister Jeremiah Manele and Thailand’s foreign minister Maris Sangiampongsa visit China.

Economic data: Taiwan releases its June trade figures, Japan publishes data on money supply, Indonesia announces May retail sales and Australia’s July consumer sentiment index is due.

Corporate updates: Japanese semiconductor group Tokyo Electron holds a fireside chat with investors in San Francisco. Korea Electric Power Corporation holds an extraordinary meeting.

A former employee of the World Economic Forum has sued the Swiss non-profit, which runs a high-profile conference each year in Davos, and its chair, Klaus Schwab, for discrimination.

Topaz Smith, a Black woman, alleged that during her nearly two years at the forum she was denied professional opportunities because of her race and gender.

The lawsuit, filed in New York on Monday, claimed that the forum permits an atmosphere that is hostile to women and Black employees”.

In one instance, Smith alleged, she was told by a white manager to think of her boss, who was also white, as her “master”.

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The US Securities and Exchange Commission is rethinking its proposed new rules on liquidity and pricing for mutual funds, in a victory for asset managers who had argued that the regulations would drive away customers and reduce investor choice.

The SEC on Monday said in a regulatory filing made public that the Division of Investment Management was considering recommending that the rules first put out for comment in 2022 be reproposed, essentially starting the process over.

A spokesman for the Investment Company Institute, an industry lobby group, said the announcement was “encouraging”, because the original proposal was “unworkable in the US, based on flawed reasoning, and would have put the investments of millions of Americans at risk.”

The S&P 500 notched its longest winning streak in more than five months, despite a relatively muted day of trading on Wall Street that still left the index at a record high.

Wall Street’s benchmark equities index ended Monday’s session 0.1 per cent higher, notching up its fourth record closing high in a row. That represented part of a five-session winning streak, its longest run since late January.

The Nasdaq Composite gained 0.3 per cent to again finish at a record high. The index’s five-session winning streak was its longest since mid-June.

The yield on the policy-sensitive two-year Treasury lifted off Friday’s three-month low, rising 0.03 percentage points to 4.63 per cent.

Nato allies are not seeking reassurance about US President Joe Biden’s health, the White House said Monday.

Dozens of world leaders are set to arrive in Washington for the bloc’s 75th summit.

Biden will host a dinner on Wednesday for attending presidents and prime ministers at the White House and will hold a press conference on Thursday as questions swirl about his health and stamina after a poor performance debate late last month.

“We’re not picking up any signs of that from our allies at all,” US National Security Council spokesman John Kirby said on Monday. “They’re very excited about this summit.”