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Pension fund ownership of UK stocks hits record low

Pension funds held their lowest level of UK stocks on record at 1.6pc
Pension funds held their lowest level of UK stocks on record at 1.6pc - REUTERS/Hollie Adams

Pension fund’s share of Britain’s stock markets has fallen to a record low, official figures show, as they seek more profitable returns overseas.

Insurance and pension funds’ proportions in UK quoted shares slumped to 4.2pc in 2022, according to the Office for National Statistics (ONS).

It was the lowest proportion jointly held by them on record. The proportion has been falling since 1997, when the combined ratio owned was 45.7pc of UK equities.

Pension funds alone held just 1.6pc, the lowest figure on record.

The ONS said the fall may be because companies are “expecting more profitable returns on overseas shares” as well as changes in pension fund regulations.

The data show that at the end of 2022, shares in quoted UK-based companies listed on the London Stock Exchange were worth a total of £2.42trillion.

The proportion of UK shares held by overseas investors increased to a record high of 57.7pc of the value of the UK stock market.

Read the latest updates below.


06:21 PM GMT

Signing off

Thanks for joining us today. Chris Price will be back tomorrow morning with the latest markets news. In the meantime, I’ll leave you with a couple of business stories from this afternoon:

The Telegraph's Obituaries Editor, Andrew M. Brown, making real sourdough bread, 2013
The Telegraph's Obituaries Editor, Andrew M. Brown, making real sourdough bread, 2013 - Geoff Pugh

06:10 PM GMT

Qatar's wealth fund selling nearly half its stake in Barclays

Qatar’s sovereign wealth fund is to raise as much as £517m from selling nearly half its stake in Barclays, according to a Bloomberg report.

The sale represents 2.4pc of Barclay’s entire share capital.

Barclays' HQ at Canary Wharf, London
Barclays' HQ at Canary Wharf, London - Simon Dawson/Bloomberg

05:59 PM GMT

Virgin Galactic shares plunge 15pc after Branson rules out further investment

Shares in space travel business Virgin Galactic have plunged today on the New York Stock Exchange after Sir Richard Brason ruled out putting any more money into the venture.

The entrepeneur told the FT that his conglomerate doesn’t “have the deepest pockets after Covid, and Virgin Galactic has got $1bn, or nearly. It should, I believe, have sufficient funds to do its job on its own.”

Richard Branson ringing the First Trade Bell to commemorate Virgin Galactic's first day of trading on the New York Stock Exchange on October 28, 2019
Richard Branson ringing the First Trade Bell to commemorate Virgin Galactic's first day of trading on the New York Stock Exchange on October 28, 2019 - Johannes Eisele/AFP/Getty

05:39 PM GMT

Zuckerberg sells £146m of Meta stock after share price rally

Mark Zuckerberg has sold $185m (£146m) of Meta shares, his first such sales in more than two years, after its stock rebounded as he ramps up spending on philanthropic projects. Matthew Field reports:

The share sale comes after Mr Zuckerberg announced plans in September to build a $250m artificial intelligence (AI) supercomputer to find cures for diseases. The resource will provide scientists access to models of healthy and diseased human cells to accelerate medical research.

The billionaire’s Chan Zuckerberg Initiative, founded with his wife Priscilla Chan, has already pledged billions of dollars to life sciences research.

The Meta chief executive and Ms Chan launched the programme in 2015, pledging to give away 99pc of their stock in the technology company to good causes. The billionaire currently owns over $117bn in Meta stock.

On Wednesday last week, the Meta founder’s personal trust, as well as entities linked to the Chan Zuckerberg Initiative, offloaded tens of millions of dollars in stock.

The sales were his first since November 2021, when Meta’s stock had collapsed more than 70pc in less than six months, falling below $100. Since then, the company’s share price has rebounded and it is currently trading at around $315.

The Chan Zuckerberg Initiative, launched in 2015, currently has assets of over $6bn.

Facebook's Mark Zuckerberg testifies on Capitol Hill in Washington, 2018
Facebook's Mark Zuckerberg testifies on Capitol Hill in Washington, 2018 - Andrew Harnik/AP

05:01 PM GMT

FTSE closes in the red

The FTSE 100 was down today, by 0.22p to 7512.96m, led by declines in mining stocks. Anglo American was down 3.74pc, while Glencore was down 3.07pc. The biggest risers were Rolls-Royce, up 3.14pc, and JD Sports, up 2.84pc.

The FTSE 250 - made up of companies with more of a UK focus - was down 0.26pc. 888 Holdings jumped 19.05pc amid takeover speculation, while Auction Technology Group (publisher of Antiques Trade Gazette and creator of  online auction platforms) was up 6.22pc. Cab Payments was down 4.43pc while engineering firm Senior was down 3.64pc.


04:53 PM GMT

UBS sells private jet used by former Credit Suisse chairman to break Covid rules

UBS has attempted to draw a line under Credit Suisse’s controversial past by selling the private jet that its former chairman used to break Covid lockdown rules. Michael Bow reports:

The Swiss bank, which combined with its smaller rival earlier this year, recently sold Credit Suisse’s Dassault Falcon 7X, which Sir António Horta-Osório had used to fly to the UK to watch the Wimbledon tennis final and the European Championship final on the same day in July 2021.

Sir António breached the Covid lockdown rules because restrictions at the time required anyone entering the UK from a higher risk country to quarantine for 10 days.

UBS and Credit Suisse now rely on commercial aircraft to fly their bosses around the world. The Financial Times first reported the sale.

According to an internal investigation, Credit Suisse found that Sir António had breached Covid regulations twice in 2021.

After the Wimbledon trip, Sir António was found to have again breached Covid rules when he flew out of Zurich just days after arriving in London.

At the time, Switzerland had a 10-day quarantine rule in place that meant he should not have been travelling.

After stepping down in January 2022, Sir António said: “I regret that a number of my personal actions have led to difficulties for the bank and compromised my ability to represent the bank internally and externally.”

Credit Suisse and UBS declined to comment.

Antonio Horta-Osorio, as chairman of Credit Suisse, during a television interview, 2021
Antonio Horta-Osorio, as chairman of Credit Suisse, during a television interview, 2021 - Bloomberg

04:43 PM GMT

Saudi Arabia signals longer supply cuts amid sliding oil price

Opec’s supply cuts can “absolutely” go on beyond the the first quarter of 2024, the Saudi energy minister Abdulaziz bin Salman Al Saud has said.

The comment comes after the price of oil slid last week despite the attempt by the Opec cartel on Thursday to hike the price.

While Saudi Arabia and Russia both committed to deepen production cuts through to March next year, Angola refused to scale back supplies further. A lack of consensus meant countries were able to announce cuts on a “voluntary” basis.

The price of Brent Crude, the international benchmark, is down by 1.48pc today.


04:28 PM GMT

Spain hopeful despite setback for EU trade deal with South America

A trade deal that the EU has been trying to secure for a quarter of a century could be signed by the end of year, the Spanish government has suggested.

The EU reached an in principle agreement for a free trade agreement in 2019 with the Mercosur bloc, but the detail has still to be agreed. The Mercosur bloc has Argentina, Brazil, Paraguay and Uruguay as its core members.

The deal received a setback this week after further negotiations planned for this week were axed as a result of the election of Javier Milei in Argentina, who takes up office on December 10.

Were a deal to be signed, it would make it easier for South American beef, poultry, sugar and ethanol to enter Europe, and help European exporters of wine, cheese, cars, chemicals and machinery.

A source within the economic ministry of Spain told Reuters:

There are windows of opportunity to reach a successful conclusion, including before December 31, and we remain hopeful that it can be achieved before that date

Spain is currently in the position of chair of the Council of the European Union.

Argentina's President-elect Javier Milei waves during a session at the Argentine Congress in Buenos Aires on November 29
Argentina's President-elect Javier Milei waves during a session at the Argentine Congress in Buenos Aires on November 29 - Juan Mabromata/AFP/Getty

04:07 PM GMT

Infrastructure buyouts likely to rise in 2024, says KKR

The private equity house KKR - famous for its leveraged buyouts of companies such as RJR Nabisco - says dealmaking in the intrastructure sector will grow next week.

The company is currently involved in the purcase of Telecom Italia’s landline network, Netco - Italy’s version of BT Group’s Openreach.

Higher interest rates have meant the common private equity approach of funding the purchase of companies with debt is trickier than it was. But Raj Agrawal, KKR’s global head of infrastructure, has told investors (according to a letter seen by Bloomberg News) that infrastructure assets with “entrenched customer bases, strong market
positions, and contractual and regulatory protections” can provide investors with protection during difficult economic ties.

“Inflation and rising interest rates exacerbated a valuation gap between buyers and sellers and froze many traditional credit markets,” he said.

Trading information for KKR is displayed on a screen at the New York Stock Exchange
Trading information for KKR is displayed on a screen at the New York Stock Exchange - Brendan McDermid/Reuters

03:51 PM GMT

Bulb creditor Sequoia receives £50m payout from energy supplier’s collapse

Bulb creditor Sequoia will receive a £50m payout as it scrambles to claw back a loan, two years on from the energy supplier’s collapse. Melissa Lawford has the details:

The Sequoia Economic Infrastructure Fund (SEQI) has secured a further £25m in cash from Bulb’s administrators, meaning it has now recovered £50.3m from an outstanding loan when Bulb went into Special Administration.

However, this is still nearly £5m short of the £55m loan that SEQI lent to the energy supply in 2018.

Bulb, which once supplied energy to 1.5m customers, collapsed in November 2021 in the early months of the energy crisis.

As wholesale energy prices soared, a total of 29 suppliers went bust because they had not forward-bought their gas and electricity, and they were unable to pass on the price increases to customers because of the cap on energy bills.

Steve Cook, director at Sequoia’s investment management company, said: “Although lengthy, this successful process demonstrates the defensive nature of infrastructure assets with strong recovery potential for lenders.”

Of the newly agreed £25m, SEQI will receive £9m of this “shortly” and the remaining £16m “in or shortly after” September 2024.

In total, SEQI has recovered £39m in cash as well as £11.3m in shares of Zoa Technologies, a software company set up to redevelop Bulb’s consumer technology and licence it to energy supply companies in the UK and abroad.

The SEQI fund is London-listed in the FTSE 250 index and invests in private loans and bonds for economic infrastructure.

Bulb’s joint administrators did not respond to a request for comment.


03:30 PM GMT

Handing over

I’ll sign off at this stage and leave you in the hands of the ever reliable Alex Singleton.

After the recent cold snap, the woolly jumpers were out in force over the weekend - and no doubt they will be again for Christmas Jumper Day on Thursday in aid of Save the Children.

The charity’s ambassador Myleene Klass paid a visit to Story Knits, a second-hand jumper pop-up store in Covent Garden, London, which was launched as part of the annual campaign.

Save the Children ambassador Myleene Klass during a visit to Story Knits, a second-hand jumper pop-up store in Covent Garden
Save the Children ambassador Myleene Klass during a visit to Story Knits, a second-hand jumper pop-up store in Covent Garden - Lucy North/PA Wire

03:20 PM GMT

Starmer says economic growth requires 'competitive' taxes

Sir Keir Starmer said delivering growth is the “path to public service investment and keeping taxes competitive”.

He told the Resolution Foundation conference in London:

It will be a hard road to walk - no doubt about it.

Anyone who expects an incoming Labour government to quickly turn on the spending taps is going to be disappointed.

Inflation, debt, taxes are now huge constraints. Of course we will make different choices.”

We will be ruthless when it comes to spending every pound wisely.

He told the conference he was offering “a counsel of realism, not despair”.

Sir Keir also called the Autumn Atatement a “fiscal sleight of hand”, which “showed the Government is quite prepared to salt the earth of British prosperity, in pursuit of its political strategy”.


03:14 PM GMT

Starmer says Labour will deliver 'securonomics'

Sir Keir Starmer accused Rishi Sunak’s party of “waiting around for the genteel conditions of the great moderation to return, rather than letting go of a failed ideology”.

He said of the Conservatives: “They have refused to reassess the role of government as the careful steward in tough times.”

Instead, Sir Keir stressed the need for Labour’s brand of “securonomics”.

“No matter what is stored up for us, it will remain our north star,” he said.

Sir Keir Starmer addresses the Resolution Foundation conference
Sir Keir Starmer addresses the Resolution Foundation conference - REUTERS/Hollie Adams

03:12 PM GMT

Labour will 'deliver on levelling up' says Starmer

Sir Keir Starmer said his party would “deliver on levelling up”.

The Labour leader used the Tory-coined slogan as he addressed a Resolution Foundation conference. He said:

Broad-based growth - economic security for every community - is now the only way to a stable politics and national unity.

In short, we have to deliver on levelling up. We have to provide a more secure foundation for working people to get on, with cheaper bills, more home ownership and stronger worker rights.

But most of all - we have to provide sustained economic stability.

This isn’t just rhetoric. When politics keeps lurching, when you lose control of the economy - as this Government has done - that loads political insecurity onto the backs of working people, and family finances take the hit.


03:06 PM GMT

Covid handouts have made people less willing to work, central bankers warn

Covid handouts have made people less willing to work, a group of the world’s most senior central bankers has warned.

Our senior economics reporter Eir Nolsøe has the latest:

The Bank of International Settlements (BIS) said “workers’ preferences have shifted in favour of fewer working hours” since the pandemic.

An unwillingness to work longer hours has been most pronounced in countries that gave citizens the biggest handouts during the pandemic, it said.

The BIS called out the UK specifically, where the Government spent tens of billions supporting furloughed workers during Covid, as well as the US and Canada.

While most countries’ workforces have recovered to the levels they were at prior to the pandemic, all three developed nations are notable exceptions.

The UK’s employment rate remains 0.9 percentage points below its pre-pandemic level at 75.7pc.

Read how the BIS linked this trend to generous handouts during the pandemic.


02:51 PM GMT

William Hill owner's shares jump amid takeover speculation

William Hill owner 888 has seen its shares soar on mounting takeover speculation after the group was reportedly the target of a £700m bid approach in the summer.

The gambling giant saw its shares jump as much as 21pc higher at one stage today after it is said to have rejected a takeover proposal worth 156p a share from rival Playtech.

FTSE 250-listed Playtech tabled a written indicative approach to buy 888 Holdings in July but this was rebuffed for being too low, according to The Sunday Times.

It comes weeks after it also reportedly emerged that US betting group DraftKings had also been eyeing 888 for a possible acquisition in the summer.

Shares in 888 surged on the latest reported bid interest as investors increasingly see the group in the line of fire for an opportunistic approach.

Its shares have had a torrid past year, slumping by nearly a fifth in the past six months alone.

William Hill owner 888's shares surged as much as 21pc
William Hill owner 888's shares surged as much as 21pc - Leon Neal/Getty Images

02:34 PM GMT

Wall Street falls ahead of jobs market data

US markets have dropped as investors turned wary ahead of a slew of economic data this week that is likely to test the narrative about a cut in interest rates by the Federal Reserve early next year.

The Dow Jones Industrial Average fell 156.12 points, or 0.4pc, at the open, to 36,089.38.

The S&P 500 opened lower by 30.26 points, or 0.7pc, at 4,564.37, while the Nasdaq Composite dropped 136.37 points, or 1pc, to 14,168.66 at the opening bell.


02:15 PM GMT

Roche beefs up race to make weight loss drugs as it buys Carmot

Roche has agreed to take over unlisted obesity drug developer Carmot Therapeutics for $2.7bn (£2.1bn) as it joins a list of corporations seeking to challenge Novo Nordisk and Eli Lilly as the dominant makers of weight-loss drugs.

US-based Carmot’s most promising drug candidate is a once-a-week injection called CT-388.

After encouraging Phase I trial results, the drug is ready to be tested on humans in the second of three trial stages, with a possible market launch in the 2030s, the head of Roche’s pharmaceuticals division Teresa Graham told Reuters.

Weight-loss drug market leader Novo Nordisk is ahead with its injection Wegovy. Overwhelming demand has left the Danish group scrambling to boost production.

Swiss multinational Roche’s shares rose 2.4pc to a six-week high amid optimism that the weight-loss market, estimated by some analysts to reach as much as $100bn, will accommodate many rivals.

“The markets are large enough for ‘me too’ products, particularly when offered at the right price,” Zuercher Kantonalbank analysts said in a note.

Roche
Roche

01:59 PM GMT

Oil falls amid doubts over Opec+ supply cuts

Oil edged lower after its declines last week amid scepticism about the strength of supply cuts announced by the Opec+ cartel.

Global benchmark Brent slipped 0.6pc near $78 a barrel after a six-week losing run, while West Texas Intermediate was down 0.7pc below $74.

It comes as European crude markets — which help set benchmark prices — are facing a supply glut due to a combination of weak regional crude demand and an influx of cargoes from the US.

Markets have also been unfazed by the announcement of an extra one million barrels per day of cuts to supplies announced by the Opec+ group of oil-producing nations last week, amid doubts about the extent to which the pledge will be enforced.


01:39 PM GMT

Wall Street edgy ahead of jobs figures

US stock indexes slipped in premarket trading as investors turned await a series of economic data this week that will indicate whether there will be cuts in interest rates by the Federal Reserve early next year.

Wall Street kicked off December on an upbeat note, extending gains from the previous month that were driven by robust earnings and expectations that the Fed was done with its rate hiking campaign.

The benchmark S&P 500 registered its highest close of the year on Friday as remarks from Fed chairman Jerome Powell bolstered the peak rates view.

Traders have priced in the likelihood that the central bank will keep rates unchanged next week, with about 61pc betting on rate cuts starting as soon as March 2024, according to the CME Group’s FedWatch tool.

However, some analysts have cautioned that markets have been too quick to price in lower interest rates.

Mohit Kumar, chief European economist at Jefferies, said: “We are not in the camp of early or aggressive cuts. Inflation has been coming down but the path towards 2pc is still long.”

A number of economic reports through the week will provide a gauge on the interest rate path as well on the potential for a “soft landing” - where the Fed manages to bring inflation under control while averting a recession.

In premarket trading, the Dow Jones Industrial Average was up 0.3pc, the S&P 500 had gained 0.4pc, and Nasdaq 100 futures were up 0.5pc.


01:09 PM GMT

Barclay family regains ownership of The Telegraph after £1.2bn Lloyds loan repaid

The Barclay family has regained ownership of The Telegraph after repaying £1.2bn in debts owed to Lloyds Banking Group.

Our reporters James Warrington and Michael Bow have the details:

The high street lender said repayment had been made in full, meaning both The Telegraph and The Spectator magazine have been released from receivership.

The move effectively ends Lloyds’ involvement in the complex sale, with ownership of both titles spinning back to the Barclay family.

The repayment was funded by a £1.2bn loan from RedBird IMI, an Abu Dhabi-backed fund that plans to take control of the titles through a complex debt-for-equity swap.

However, both The Telegraph and The Spectator will continue to be overseen by a trio of independent directors while the Government carries out a public interest investigation, amid concerns about foreign state ownership and press freedom.

Read what happens now.


12:51 PM GMT

Extend Northern Ireland protocol to whole of UK, says Bank of England official

The UK can “punch above its weight” as an economy by tweaking trade policies like the Northern Ireland protocol, according to a Bank of England official.

Policymaker Swati Dhingra said Britain should take “very ambitious” measures to boost ties with the EU, including
extending the Northern Ireland protocol to the rest of the UK.

In a paper for the Resolution Foundation conference, Ms Dhingra said: “As a small open economy that does not have the deep pockets of large trading blocs, the UK can punch above its weight in the world economy through policy design offering a regulatory comparative advantage to businesses, investors and trade partners.”

At a panel discussions, she added the UK should look at boosting ties in services given it is the world’s second-largest exporter of this trade. She said:

The Free Trade Agreements are really about goods, and it doesn’t really build on services, which is the key comparative advantage.

The UK is a services superpower — I’m not saying that lightly.


12:33 PM GMT

Pound falls ahead of US jobs figures

The pound has fallen against the dollar, which has strengthened ahead of US jobs data due throughout the week.

Sterling has fallen 0.3pc against the global reserve currency to $1.26 as investors prepare for a series of publications of figures this week that will indicate how well the American economy is faring.

Market attention has also shifted in recent weeks to when the Bank of England will begin cutting interest rates.

The Bank Rate is currently at a 15-year high of 5.25pc, but with inflation starting to cool and the economy slowing, traders think rates have probably peaked.

Nicholas Rees, FX market analyst at Monex, said: “With a limited UK data calendar, the key for sterling is going to be how markets view the divergence in central bank easing expectations between the Bank of England and other developed market central banks.”


12:17 PM GMT

Bitcoin surges after regulator's meeting over 'ETF' plans

The price of bitcoin has surged after a meeting last week between US regulators and asset manager Grayscale Investments to discuss its Bitcoin Trust.

Grayscale met with the US Securities and Exchange Commission (SEC) as it tries to turn the trust into a so-called exchange-traded fund (ETF), one of many investors who want to launch a bitcoin ETF in the US.

An ETF essentially tracks the price of an asset, in this case bitcoin.

It would therefore allow investors to bet on bitcoin without actually owning the cryptocurrency themselves.

This would essentially allow them to invest in bitcoin like it was a regular stock. They would not have to deal with a crypto exchange.


12:04 PM GMT

Boohoo shares rise as Frasers increases stake

Boohoo shares have gained as much as 5.9pc after Mike Ashley’s Frasers increased its stake in the fast-fashion retailer.

Frasers has increased its stake from 16.5pc to 17.2pc, helping list its own share price by 0.6pc.

Shares in Boohoo rival Asos, in which Frasers also holds a stake, rose as much as 6.1pc.

Boohoo shares have gained after Frasers increased its stake in the company
Boohoo shares have gained after Frasers increased its stake in the company - REUTERS/Caitlin Ochs

11:50 AM GMT

Britain's economy has a 'sprained ankle, not a broken leg', says Hunt

In a colourful section of his session at the Resolution Foundation’s conference, Jeremy Hunt insisted that the UK economy only had a “sprain” and not a “broken leg”.

The Chancellor faced a question from one audience member, who asked why the think tank was “describing an economy that has a broken leg” while the “chief surgeon” disagreed.

Mr Hunt said: “I think it’s really important not to lose our self-belief.”

He suggested that UK commentators were good at identifying problems, but added:

I’m not sure I’d describe it as a broken leg but identifying areas where we can do better.

And that is a very good thing for us that we do that. But sometimes we forget that other countries also have the things that they need to improve.

I think we shouldn’t lose confidence that we do some things absolutely amazingly. I know he’s controversial in other ways but when Elon Musk was here three weeks ago, he said there were only two centres in the world for AI, San Francisco and London.

We’ve got a lot going for us, so if we’re going to go into dealing with the sprain, rather than the broken leg, then let’s do so from a perspective of positivity.


11:36 AM GMT

Bitcoin passes $42,000 for first time since 2020

Bitcoin has hit a 20-month high as it topped $42,000 (£33,100) amid speculators piled into the digital currency.

The world’s largest digital token rose as much as 6.1pc to $42,144, its highest level since April 2020, putting it on track for its biggest annual gain since 2020.

Smaller cryptocurrencies have also moved higher, including Ether, Dogecoin and Bitcoin Cash.


11:28 AM GMT

Governments need to find the nerve to make long term changes, says Hunt

Jeremy Hunt ended his session at the Resolution Foundation conference saying Government’s in Britain must consider the long-term when making decisions.

He said:

It’s really important that we’re long term. The benefits of those 110 measures - the £20bn of business investment - aren’t scored by-and-large by the OBR because most of them will feed through not in five years but within a decade.

The real benefits will be because companies like Toyota and Nissan say they want to build plants here because they can see the benefits in the medium and long term - in 10 and 20 years time.

I think that what really matters is that despite all the political noise,  Governments find the nerve to make long term changes - the really difficult changes - that will make a difference.

As long as we do that we have got the most amazing prospects in front of us.

Jeremy Hunt addresses the Resolution Foundation conference
Jeremy Hunt addresses the Resolution Foundation conference - Maja Smiejkowska/PA Wire

11:22 AM GMT

Do not risk our regained financial reputation, Hunt warns Labour

Jeremy Hunt warned that Labour that whichever party wins the next election must not risk Britain’s reputation for looking after the nation’s finances.

The Chancellor’s warning comes a little over a year after a spike in Government borrowing costs caused by Liz Truss’ mini-Budget.

Speaking at a Resolution Foundation event, which Labour leader Sir Keir Starmer will address later, Mr Hunt said:

We have an election next year and we have to make the right choice at that election.

We are making big changes but one of the things we have won back is a reputation for fiscal probity.

It is not possible to meet our fiscal rule to reduce debt in five years and to increase borrowing by £28bn a year. One of those two has to be false.

I hope, whatever the country decides next year, we do not relinquish our reputation for fiscal probity.


11:03 AM GMT

Hunt: Improving productivity will close gap with France, Germany and US

Chancellor Jeremy Hunt said his Autumn Statement’s tax breaks for business investment were designed to improve the UK’s productivity.

“The only way in the long run that you can raise living standards is by raising productivity,” he told the Resolution Foundation’s conference in London.

The Autumn Statement introduced “the most competitive business investment reliefs in the world”, matched only among the OECD group of developed nations by Latvia and Estonia.

Along with the other 109 growth measures in the package, Mr Hunt said it would increase business investment in the British economy by “20 billion a year”.

That would close “about half the gap” with competitors such as Germany, France and the United States, where firms invest around 2pc of gross domestic product (GDP) more a year than in the UK.


10:56 AM GMT

Hunt: Britain has 'untapped potential' to be most prosperous 21st century economy

Jeremy Hunt insisted the UK could be the “most prosperous” economy this century because of its “untapped potential”.

He said the industrial sectors which would grow the fastest are ones “where we are doing really well”.

The Chancellor told a conference hosted by the Resolution Foundation think tank: “If I was going to choose one country in the world that had the most untapped potential to become the most prosperous 21st century economy, it would be Britain.”

He said the UK had a technology sector that was “double the size of Germany’s, three times the size of France”.

Mr Hunt acknowledged that improving the UK’s productivity was the key challenge.

“If you ask why it is that we’ve grown faster than Germany since 2010, despite their higher productivity, it is because we are actually stronger on innovation. If we could solve the productivity bit, there would be no stopping us.”


10:46 AM GMT

Bitcoin making gains as scandals clear out 'bad actors', says asset manager's boss

Bitcoin is topping $41,000 because - not despite - of the recent scandals that have gripped the cryptocurrency sector, an asset management boss has said.

DeVere Group chief executive Nigel Green said the scandals have been clearing out “bad actors” from the market.

Former FTX boss Sam Bankman-Fried was found guilty of fraud last month while Binance founder Changpeng ‘CZ’ Zhao pleaded guilty to money laundering violations and agreed to pay a $50m fine and step down from his role as the company’s chief executive.

Mr Green said:

The CZ/Binance scandal and the FTX collapse which resulted in a month-long trial which convicted the FTX founder Sam Bankman-Fried of seven counts of fraud and conspiracy, triggered some short-term volatility, but the crypto market has continued to remain bullish.

It appears that law enforcement and regulatory authorities worldwide are cracking down on executives and companies of digital currencies.

This greater regulatory scrutiny is seemingly appealing to investors who are piling into the likes of bitcoin.

It would also be attractive to institutional investors who bring with them huge amounts of capital.


10:38 AM GMT

Britain must capitalise on areas of 'competitive advantage,' says Hunt

Jeremy Hunt said the Government’s strategy to deliver growth combines increasing productivity with capitalising on Britain’s “competitive advantages” against other countries.

Speaking at a Resolution Foundation event, the Chancellor said the first part of his strategy was to “deal with productivity by increasing business investment”.

He added this also required an improvement in skills.

The second part of his strategy is to capitalise on Britain’s innovative technology and financial services industries.

He said Britain has “got to have a very clear view of where our competitive advantage is”.

Chancellor Jeremy Hunt laid out his pitch for growth
Chancellor Jeremy Hunt laid out his pitch for growth - CHRIS RATCLIFFE/POOL/EPA-EFE/Shutterstock

10:27 AM GMT

Pension fund ownership of UK stocks hits record low

Pension fund’s share of Britain’s stock markets has fallen to a record low, official figures show, as they seek more profitable returns overseas.

Insurance and pension funds’ proportions in UK quoted shares slumped to 4.2pc in 2022, according to the Office for National Statistics (ONS).

It was the lowest proportion jointly held by them on record. The proportion has been falling since 1997, when the combined ratio owned was 45.7pc of UK equities.

Pension funds alone held just 1.6pc, the lowest figure on record.

The ONS said the fall may be because companies are “expecting more profitable returns on overseas shares” as well as changes in pension fund regulations.

The data show that at the end of 2022, shares in quoted UK-based companies listed on the London Stock Exchange were worth a total of £2.42trillion.

The proportion of UK shares held by overseas investors increased to a record high of 57.7pc of the value of the UK stock market.


10:11 AM GMT

Gas prices fall as demand remains low

It was a bitterly cold weekend but wholesale gas prices remain subdued as the outlook for demand remains weak.

Europe’s benchmark contract fell as much as 4.9pc as the market remains confident about the plentiful levels of storage.

The UK’s equivalent contract was down as much as 5pc.

It comes as the weather is expected to turn milder across Britain and northern parts of Europe towards the end of the week, further limiting usage.


09:54 AM GMT

German exports shrink as demand from EU wanes

German exports fell unexpectedly in October on the back of lower demand from fellow European Union countries, official data showed Monday.

Exports totalled €126.4bn euros (£108.4bn), down 0.2pc on the previous month, according to adjusted figures from federal statistics agency Destatis.

Analysts surveyed by Factset had predicted a 1pc rebound in exports following a dip in September.

Imports meanwhile declined more sharply by 1.2pc month-on-month, totalling €108.6bn.

As a result, the country’s trade surplus - the difference between exports and imports - grew to €17.8bn from €16.7bn in September.

The latest drop in exports was driven by a 2.7pc plunge in demand from EU member states, against a sombre economic backdrop.

The German economy, the EU’s largest, has struggled to find its way out of a downturn in recent months as it battles headwinds including the fallout from Russia’s war in Ukraine, high inflation and weaker demand from China.

The German government expects output to contract by 0.4pc this year.


09:40 AM GMT

Turkish inflation hits 61.98pc

Turkey’s annual inflation rate ticked up slightly in November showing further signs of levelling off following a series of sharp interest rate rises.

The rate moved to 61.98pc last month from 61.36pc in October, the TUIK state statistics agency said.

The pace at which consumer prices are rising has started to ease, after six successive months of interest rate hikes took borrowing cost to 40pc from 8.5pc.

Analysts are pencilling in a final rate rise of 2.5 percentage points at the central bank’s next policy meeting on December 21.

The latest batch of data show higher borrowing costs starting to slow down consumption - a key goal of the central bank.

Turkey’s gross domestic product rose by just 0.3pc between July and September. It had risen by 3.3pc between April and June.


09:20 AM GMT

Wizz Air suspends Israel flights until next year

London-listed Hungarian airline Wizz Air said that it has decided to suspend operations in Israel until early January next year.

The budget airline said it “continues to monitor the situation on the ground closely, and stands ready to redeploy capacity should conditions stabilise”.

It carried 29.3pc more passengers in November, at 4.8m.

Wizz Air said it had also restarted inbound flights to Chisinau, Moldova, in Eastern Europe having suspended flights to the country in March due to tensions linked to Russia’s war with Ukraine.

It said the move follows a “comprehensive evaluation of safety factors”, adding that the group “intends to gradually reintroduce operations, including reopening its base in Chisinau, while ensuring safe and secure operations for its crew and passengers”.

Wizz Air has cancelled its flights to Israel until January
Wizz Air has cancelled its flights to Israel until January - REUTERS/Bernadett Szabo

09:03 AM GMT

Saudi Arabia buys 49pc stake in Rocco Forte hotels

Saudi Arabia’s sovereign wealth fund has taken a minority stake in the Rocco Forte luxury hotels group as it continues to diversify the kingdom’s investments away from oil.

Founders Rocco Forte and his sister Olga Polizzi will remain as executive chairman and deputy chair, respectively.

The Forte family will retain majority ownership and control of the company, which owns the Balmoral hotel in Scotland among its 14 sites across Europe.

Saudi Arabia’s Public Investment Fund (PIF) has purchased a 49pc stake in the hotel group, valuing it at about £1.2bn, the FT reported. Rocco Forte did not comment on the size of the stake.

Chairman Forte said: “PIF is an excellent partner for us going forward. They share the same vision for the brand and the future strategy of the group with the same ambition to take a long-term view.”

Hotelier Rocco Forte will remain as executive chairman of the group
Hotelier Rocco Forte will remain as executive chairman of the group - Andrew Crowley

08:48 AM GMT

FTSE 100 falls amid declining oil prices

The FTSE 100 fell in early trading as heavyweight energy stocks lost ground amid declining crude prices.

The blue-chip index was down 0.2pc in early trading, while the more domestically-focussed FTSE 250 midcap index added 0.5pc.

The oil and gas sector fell as much as 2pc as crude oil prices fell amid uncertainty over global fuel demand growth and doubts over the strength of the Opec+ group’s pledge to cut output.

Brent crude has fallen more than 1pc in London toward $78 a barrel.

Industrial metal miners slipped 2.7pc as copper prices fell on a stronger dollar.

The market will be focused this week on US employment data, with an October JOLTS number and November ADP National Employment report due during the week leading up to the more comprehensive November non-farm payrolls report on Friday.

Among individual stocks, Rolls-Royce gained 3.6pc to top the FTSE 100 after JP Morgan upgraded the engineering company’s stock to “overweight” from “neutral”.


08:36 AM GMT

Ryanair cancelled 1,830 flights since start of Israel-Hamas war

Low-cost airline Ryanair has said more than 960 flights were cancelled last month due to the war between Israel and Hamas.

It comes after the Irish carrier cancelled over 870 flights in October as a result of the conflict in Gaza.

Airlines have suspended flights to Tel Aviv and neighbouring Jordan after Hamas militants launched an attack on Israel on October 7 and due to the subsequent escalation of the war.

Rival easyJet said last week that conflict and the threat to stability across the Middle East has also affected demand for flights in destinations such as Egypt, while it saw bookings impacted across the board in October and November due to the war.

EasyJet warned that it does not expect to narrow losses in the first quarter of its new financial year as flights and wider demand are affected, but it said booking appetite had started to recover in recent weeks.

Ryanair’s latest passenger statistics showed it operated over 66,400 flights in November, with a 4pc increase in people flown, at 11.7 million, despite the cancellations.

The budget airline’s shares have climbed 1.1pc in early trading.

Ryanair
Ryanair

08:25 AM GMT

BBC 'needs to be realistic' about licence fee increases, says minister

Culture Secretary Lucy Frazer said that a £15 rise in the BBC licence fee would be “high”, after the Telegraph reported that Rishi Sunak is set to block a 9pc hike in the annual fee.

Ms Frazer was asked on Times Radio about the Prime Minister’s suggestion that the BBC needs to be “realistic” about what people can pay.

She said:

What that means is that we’re in a position where people are struggling with the cost of living. And as a Government, we tried very hard to make sure that those costs are low. And the licence fee is due to rise, although we froze it for two years.

But as it rises, the BBC needs to be realistic about how much it can rise by. We want to make sure we protect licence fee payers and make sure that it just rises at an amount that people can afford.

Asked about a rise over £170, she said: “Well, obviously, that’s high. This is something that we’re looking at at the moment. And we’ll be making a decision on this in due course.”


08:19 AM GMT

Bitcoin hits highest level in 19 months

Bitcoin rose past $41,000 (£32,300) for the first time since May last year as investors increasingly hope that the US will soon allow broader trading of the world’s biggest cryptocurrency.

The digital asset has skyrocketed this year, gaining nearly 150pc, with expectations growing that US regulators will allow the creation of exchange-traded funds (ETFs).

These would track the price of bitcoin and allow the public to invest in the currency without directly purchasing it.

Lucy Guzmararian, founder of Token Bay Capital, told Bloomberg: “This idea that institutional money in US capital markets is going to have a legitimate, compliant avenue... the expectations are extremely high that that’s really going to take bitcoin to new levels.”

The currency remains well below its record value of almost $69,000 in 2020, but the rally marks a recovery following the high-profile scandals and collapses that rocked the crypto industry.

FTX, the world’s second-biggest crypto exchange, dramatically went under last year, and its boss Sam Bankman-Fried faces up to 110 years in prison for what prosecutors described as “one of the biggest financial frauds in American history”.


08:07 AM GMT

UK markets mixed at the open

Britain’s stock markets lacked direction at the start of the week as gold hit an all-time high amid hopes of interest rate cuts.

The FTSE 100 was down 0.3pc to 7,503.55 while the domestically-focused FTSE 250 gained 0.2pc to 18,444.22.


07:54 AM GMT

Spotify needs to embrace leaner structure, says boss

As he announced 17pc of Spotify’s staff will find out within hours that they will lose their job, chief executive Daniel Ek said:

When we look back on 2022 and 2023, it has truly been impressive what we have accomplished.

But, at the same time, the reality is much of this output was linked to having more resources.

By most metrics, we were more productive but less efficient. We need to be both.

While we have done some work to mitigate this challenge and become more efficient in 2023, we still have a ways to go before we are both productive and efficient.

Today, we still have too many people dedicated to supporting work and even doing work around the work rather than contributing to opportunities with real impact.

More people need to be focused on delivering for our key stakeholders – creators and consumers. In two words, we have to become relentlessly resourceful.

He added: “Embracing this leaner structure will also allow us to invest our profits more strategically back into the business.”


07:49 AM GMT

Capita sells environmental research company for £60m

Capita has agreed a deal to sell its controlling stake in environmental research business Fera Science to UK private equity firm Bridgepoint.

The outsourcing giant said it has sold its 75pc stake in Fera for an enterprise value of £60m, valuing the business at £80m.

Fera was set up in 2015 as a joint venture between Capita and the Department for Environment, Food and Rural Affairs (Defra), which holds the remaining 25pc share.

The business specialises in environmental testing, research, and advisory and assurance services for both the public and private sectors.


07:44 AM GMT

Spotify to cut nearly fifth of workforce

Spotify will cut more than 1,500 jobs after its bosses said the company had been hit by slower growth and higher interest rates.

The music streaming service, which employs about 9,300 staff, will reduce its workforce by 17pc, its chief executive Daniel Ek said in a statement on the company’s website. Staff will be notified today.

Mr Ek said: “To be blunt, many smart, talented and hard-working people will be departing us.”

Mr Ek said that in 2020 and 2021, the company had secured “lower-cost capital and invested significantly” but was down facing up to rising costs.

He said that “despite our efforts to reduce costs this past year, our cost structure for where we need to be is still too big”.

Spotify will cut 17pc of its staff
Spotify will cut 17pc of its staff - REUTERS/Eric Gaillard

07:27 AM GMT

Petrofac to offload assets to shore up finances

Oil services group Petrofac has said it is looking at selling off assets to shore up its finances as it faces a cash crunch.

The contractor said it is “examining a range of strategic and financial options” to improve its balance sheet after delays in securing advance payment guarantees on its pipeline of work.

Bosses are considering offloading “non-core assets” and are speaking to investors about taking stakes in parts of the business.

Petrofac chief executive Tareq Kawash said:

Petrofac’s underlying business is robust with material growth in our backlog from approximately $5.5 billion in new awards in new and traditional energy this year.

This demonstrates our competitive strength and long-term potential.

To deliver on this, we are working hard to address short-term liquidity challenges and strengthen the financial position of the group.

I am grateful for the continued efforts of our people, and the support of our clients and other stakeholders, as we work to deliver a positive future for Petrofac.

Petrofac said has suffered 'delays in securing advance payment guarantees,' impacting its cash flow
Petrofac said has suffered 'delays in securing advance payment guarantees,' impacting its cash flow

07:17 AM GMT

Gold hits all-time high as traders bet on interest rate cuts

The value of gold hit a new record as markets increasingly bet that interest rates will be cut early next year.

Gold rose above $2,111 an ounce for the first time in Asian trading hours, before falling back to $2,086.

There was no obvious catalyst for the move, leaving dealers suspecting that some traders were jumping onto the bandwagon after the precious metal broke $2,107 last week.

Global central banks also bought a net 800 metric tons of gold in the year to September, a record for the period, with many expecting the price to top $2,240 or $2,400.

Markets are pricing in aggressive interest rate cuts next year, which is also delivering a boost to gold, which is considered a safety net against inflation.

Traders are betting there is a 59pc chance of a US interest rate cut as early as March, up from 20pc a week ago.

Gold surged more than 3pc in early trading before paring much of those gains.

The precious metal hit new highs for a second consecutive session after breaking its record on Friday, which passed its previous all-time high it set in August 2020.

Chris Weston, head of research at Pepperstone Group, said there’s been “a big momentum shift” on gold.

Shares of gold miners were also up. Newmont rose as much as 3.6pc in Sydney, while Northern Star Resources climbed as much as 5.3pc. Zijin Mining Group jumped as much 6.4pc in Hong Kong.

The price of gold hit a record high during Asian trading hours
The price of gold hit a record high during Asian trading hours - DAVID GRAY/AFP via Getty Images

06:50 AM GMT

Good morning

Thanks for joining me. The price of gold hit a record high during Asian trading hours as investors increasingly bet that interest rates will be cut next year.

Traders are putting a 59pc chance on the US Federal Reserve cutting rates by March, helping push the price of the precious metal to $2,111 an ounce.

5 things to start your day

1) Britain’s stagnant economy is costing workers £10k a year, says think tank - ‘Low investment disease’ in the public and private sector has damaged productivity

2) Catholic church’s climate tsar brands Sunak ‘utterly reckless’ over North Sea licences - Bishop Arnold also criticises Labour’s track record on the environment

3) Minimum wage rise risks redundancies, warns recruitment giant - The move will pile pressure on companies already struggling with high labour costs

4) Tens of thousands of free cash machines will disappear in next decade, warns ATM boss - Cash use will soon be as rare as cheques as people opt for digital payments

5) Red tape holding back UK’s ambition to be a life sciences superpower, warn experts - 56pc of planned developments in the ‘Golden Triangle’ are still awaiting permission

What happened overnight


MSCI’s broadest index of Asia-Pacific shares outside Japan was still up 0.4pc, led by gains in South Korea and Australia.

Meanwhile, Japan’s Nikkei dipped 0.4pc as the yen extended recent gains. Chinese blue chips eased 0.2pc, while the country’s central bank set another firm fix for the yuan.

Trade figures for China are due later in the week with the recent trend being softening exports to the US overshadowing gains in Asia.

EUROSTOXX 50 futures and FTSE futures were a fraction firmer. S&P 500 futures slipped 0.1pc, after finishing at a 20-month high on Friday, while Nasdaq futures lost 0.2pc.

The S&P 500 is up 19pc for the year so far and just 4pc away from its all-time peak.