FTSE falls 2pc as markets lose steam

Europe
Stocks

Stocks

British tobacco firms sank on Tuesday as more than £5bn was wiped off their value after the Biden administration announced plans on Monday evening to reduce the nicotine content of cigarettes to a level that is not addictive.

British American Tobacco fell 221.5p to £26.92 – a five-week low – and Imperial Brands fell 115.5p to £14.65, its lowest price in just over four weeks.

The move “could massively undermine the long-term sales prospects of the large caps. These changes come at a time when tobacco companies are already facing demand headwinds,” said Sophie Griffiths, an analyst at Oanda.

The tobacco industry has been waiting for a number of years for America’s Food and Drug Administration to decide on whether to cap nicotine levels. Plans were first announced in 2018, with Marlboro-maker Altria saying that it did not think it was possible, nor would it reduce smoking.

The FDA is also mulling a ban on menthol cigarettes, a move that hit BAT particularly hard. Research suggested that menthol cigarettes account for up to 75pc of the cigarettes smoked by African-Americans, with the proportion even higher in younger age groups.

This has led the FDA to consider whether the category disproportionately addicts and kills black Americans. London-listed BAT merged with Reynolds in 2017 in a deal worth $ 49bn (£41bn). Reynolds was one of America’s biggest sellers of menthol cigarettes.

Tobacco firms dragged on the FTSE 100, which wiped out all of last week’s gains as it plunged 140.21 points, the highest single day fall since Feb 26, to below the level of 7,000 that it breached last week for the first time in over a year. It joined a global stock market rout to end the day at 6,859.87, while the FTSE 250 lost 382.31 points to close at 22,108.55.

Equity losses came despite sterling ending the day down 0.3pc against its European and US counterparts, to €1.1586 and $ 1.395 respectively. The pound had earlier touched a six-week high on a weak US dollar, before reversing course to stand lower.

Just behind the tobacco giants, two of the biggest losers on the benchmark, was Primark-parent Associated British Foods, which dropped 146p to £23.14, its lowest level since mid-February. It came after the company revealed a halving of profit for the year and revenue down 18pc.

“But it’s growing concern that new variants will set back recovery that seems to be having the greatest impact, particularly amongst airlines like British Airways owner IAG worried those rays of summer hope might be obscured behind another Covid-cloud,” said Danni Hewson at AJ Bell.

IAG closed as the top flight’s biggest loser, down 17.1p to 193.1p. In the same position on the FTSE 250 was cruise operator Carnival, down 104p to £15.31.

05:24 PM

Wrapping up

That is all from us today – here are some of our top stories:

Thanks for following along and see you again tomorrow. Have a good evening!

05:01 PM

Next’s Lord Wolfson soars to 5-year high

WOlfson

WOlfson

Annual pay for Lord Simon Wolfson, the boss of Next, soared to a five-year high of £3.4m following a 28pc pay hike thanks to a £2.4m long-term shares bonus. It came as the retail giant weathered torrid high street conditions amid the pandemic.

The shares boost offset a 20pc pandemic salary cut for all directors of the group between April and June last year, while they also agreed to forgo annual bonuses.

Lord Wolfson’s pay packet means he earned 178 times the average Next worker’s salary of £18,802 a year, according to its annual report. His base annual base salary also rose by 0.6pc to £824,000 in February, in line with the awards made across the workforce.

The details follow Next announcing a 54pc plunge in profits earlier this month, to £342m in the year through January as high street stores suffered amid the pandemic. Impressive online sales, however, have sent shares soaring by more than three quarters over the past year.

It raised its profit forecast for 2021-22 alongside the recent annual results, after online sales were better than expected in February and March, up 60pc on the same period two years ago.

04:41 PM

Football Index collapse to be investigated

Football

Football

Ministers have launched an investigation into the collapse of a “stock market for football” that has left fans almost £90m out of pocket.

My colleague Oliver Gill reports:

John Whittingdale, the gambling minister, is to appoint an independent expert to oversee the inquiry into the failure of Football Index.

The probe will focus on whether the Gambling Commission had the “right tools” to regulate novel betting firms such as Football Index.

04:13 PM

Bonhams buys online auction firm in digital push

Aston

Aston

Bonhams, one of the world’s oldest auction houses, has snapped up an online auction firm specialising in classic cars and motorcycles as it presses ahead with its digital expansion.

My colleague Sam Hall reports:

The company said its purchase of The Market would help to increase its online presence and give it access to a wider range of customers. Bonhams did not disclose details of the transaction but its private equity owner Epiris said it funded the purchase.

Bruno Vinciguerra, chief executive of Bonhams, said: “Digital channels now account for half of Bonhams’ business, and the acquisition of The Market will increase this further.”

The Market was founded in Oxfordshire in 2017 by Tim Joslyn and recorded a 300pc increase in sales last year compared with 2019.

Bonhams, which is owned by private equity firm Epiris, was founded in 1793 and has auctioned off a string of historic vehicles over the years including the world’s oldest surviving Rolls-Royce and the most expensive motorcycle ever sold at auction – an ultra-rare Vincent Black Lightning which sold for $ 929,000 in 2018.

03:57 PM

Halma spins out tech startup

Halma, a global group of safety equipment firms, has completed the spin-out of OneThird, a food technology startup that came from its digital growth programme.

OneThird aims to eliminate food waste by using infrared sensors, AI algorithms and machine learning to predict and extend the shelf-life of fresh produce.

Setting it up independently will allow it to attract more funding, according to FTSE 100 Halma. It said OneThird has already banked €1.5m (£1.29m) of extra funding.

03:38 PM

Markets lose steam

London’s FTSE has fallen almost 2pc, to stay firmly below the 7,000 level reached at the end of last week. Traders are taking profits from recent rallies, while the pound touched a six-week high on a weak US dollar.

Sterling touched its highest since March 4 at $ 1.4009 early today before reversing course to stand lower against the dollar by the afternoon.

Michael Hewson, market analyst at CMC Markets, has a good wrap up of today’s market losses:

“Stocks in Europe appear to have run out of steam after the gains of the last seven weeks, with profit taking appearing to be the order of the day, with losses in excess of 1pc across the board. While today’s losses are quite large, they don’t appear to be being driven by concerns over the economic outlook. If they were copper prices wouldn’t be firmer and the US dollar wouldn’t be weaker.

“With the ECB due to announce its latest policy decision on Thursday and a host of companies reporting their latest numbers, it would appear that after the impressive gains in the past few weeks some are taking the opportunity to book some profits, hence we might see further weakness in the shorter term.”

03:14 PM

Less spending, more debt payments in Jan

Borrowing slumped in January as lockdown stopped shoppers using their credit cards on the high street, instead pushing them to pay down their debts.

My colleague Tim Wallace reports:

Spending on credit cards plunged to £10.7bn, down by more than one-third compared to pre-Covid January 2020, according to industry group UK Finance.

The number of debit card transactions dropped by close to one-fifth on the year, with spending down just over 7pc at £47.8bn.

Unable to spend as normal, households have been using lockdowns to pay down their debts, bolstered by furlough which has kept workers in jobs. Credit card debts fell by almost £3.2bn in January, taking total outstanding balances down to £54.2bn.

This compares to £69.7bn at the start of last year. Debts fell modestly in the months before the pandemic, plunging through lockdowns and only slightly rising even in the peak rebound months of July and August 2020.

02:49 PM

Biotech boosted by Covid test

The pandemic has transformed the fortunes of British biotech minnow Avacta, whose share price soared after clinical data showed its lateral flow test was highly accurate, Julia Bradshaw writes.

The test’s sensitivity and specificity, a metric used by the industry to determine accuracy, were 98pc and 99pc respectively, which is better than the leading lateral flow tests already on the market.

The news sent shares in Avacta up by more than 10pc to 270p, with analysts forecasting sales volumes could reach 20m this year, rising to 90m in 2022.

“This is hugely transformational for us and validates our platform,” said chief executive Dr Alastair Smith.

“It has been pivotal for the company and has significantly altered our valuation by a factor of more than 10 times, which allowed us to raise substantial capital last year, we suddenly got lots more interest from investors.”

02:26 PM

Palladium on a roll

Tired of gold? The smart money might be on palladium, which has hit a record high as carmaker demand and supply disruptions look set to keep the market in a deep deficit.

The metal has climbed 16pc in 2021, building on five years of gains. Palladium has been in heavy demand for use in catalytic converters in petrol cars. Supply disruptions at Russian mines run by MMC Norilsk Nickel, the world’s number one producer, have exacerbated the shortfall, Bloomberg reports.

“A series of positive supply and demand factors have been driving up prices,” said Philip Klapwijk, managing director of Hong Kong-based consultant Precious Metals Insights. “That at the margin will also have sucked in some speculative trend-following money. Also, more generally, palladium had been rangebound for a while until mid-March and the ‘catalyst’ of Russian supply disruption.”

02:11 PM

Big slump in card spending in January, UK Finance data shows

Borrowing slumped in January as lockdown stopped shoppers using their credit cards on the high street, instead pushing them to pay down their debts.

My colleague Tim Wallace reports:

Spending on credit cards plunged to £10.7bn, down by more than one-third compared to pre-Covid January 2020, according to industry group UK Finance.

The number of debit card transactions dropped by close to one-fifth on the year, with spending down just over 7pc at £47.8bn.

Unable to spend as normal, households have been using lockdowns to pay down their debts, bolstered by furlough which has kept workers in jobs.

Credit card debts fell by almost £3.2bn in January, taking total outstanding balances down to £54.2bn.

This compares to £69.7bn at the start of last year. Debts fell modestly in the months before the pandemic, plunging through lockdowns and only slightly rising even in the peak rebound months of July and August 2020.

In some instances that means people have cleared their debts altogether. At the end of January 2020, more than 38m credit cards had an outstanding balance. By the end of this January that toal had fallen by more than 4m as debts were paid off.

01:42 PM

Wall Street opens in the red

US stocks have dropped at the open for a second straight day as global markets retreat from record highs.

US market data - Bloomberg 

US market data – Bloomberg

01:28 PM

Amazon opens first hair and beauty salon in London

Salon

Salon

Fancy a new hairdresser? Amazon is branching out into beauty with its first hair salon just weeks after opening its first grocery store outside the US in London.

My colleague Laura Onita reports:

The online retail giant’s Amazon Salon is a two-floor, 1,500 sq ft site in Spitalfields in east London. It says it will use technology and augmented reality to assist with haircuts and styling.

Customers will be able to experiment with different virtual hair colours, enjoy entertainment on tablets at each styling station and take photos of their new look in a dedicated area.

The services will be provided by Elena Lavagni, owner of Neville Hair & Beauty, an independent salon. It will initially be available only to Amazon employees before opening to the general public in the coming weeks.

John Boumphrey, Amazon’s UK chief, said: “We have designed this salon for customers to come and experience some of the best technology, hair care products and stylists in the industry. We want this unique venue to bring us one step closer to customers.”

12:57 PM

FCA chief plans regulatory ‘nursery’ for fintech sector

Rathi

Rathi

The City watchdog will set up a regulated “nursery” to ensure challenger banks do not fall foul of rules following criticism that it has failed to spot red flags in recent years.

My colleague Lucy Burton reports:

Nikhil Rathi, chief executive of the Financial Conduct Authority (FCA), said the scheme will give it greater levels of oversight and support to newly-authorised firms and is due to be launched by autumn.

Details of the so-called nursery are still being discussed but it will be open to all new financial firms. It is expected to mostly attract financial technology firms such as online banks which are more common as new businesses than bricks-and-mortar high street banks.

The move could also help the FCA spot potential problems early on following criticism that it is too soft on bankers and has missed various red flags in recent years. Last year a report into the FCA’s regulation of London Capital and Finance found that it missed at least six red flags indicating that the firm was breaching financial rules.

Mr Rathi said: “Currently, firms gain regulatory status and are treated in the same way as a firm with a long track record.

“The regulatory nursery will keep us in close contact with firms immediately post-authorisation so we can provide support and, where we need to, intervene earlier to steer firms in the right direction.”

12:23 PM

Petra says diamond market showing signs of recovery

South Africa-focused diamond producer Petra Diamonds says the diamond market is showing signs of recovery with “robust demand for jewellery” and prices recovering to pre-pandemic levels.

My colleague Rachel Millard reports:

The company, which owns the Cullinan mine where the Cullinan diamond in the Crown Jewels was found, said revenue for the third quarter was up 16pc to $ 106m [£75.8m].

It has just been through a debt for equity swap which has cut debts from $ 700m to $ 290.7m.

Richard Duffy, chief executive, said: “Petra is in a far stronger position, with a solid platform for future growth and development.”

Shares rose 3.33pc to 1.55p.

11:55 AM

MPs probe Greensill lobbying

The influential Treasury Select Committee said today it will demand answers from the Chancellor Rishi Sunak and former Prime Minister David Cameron about the latter’s lobbying for collapsed Greensill Capital.

Greensill’s founder, Lex Greensill, Bank of England Governor Andrew Bailey and the chief executive of the Financial Conduct Authority, Nikhil Rathi, will also face questions about the company and Mr Cameron’s actions.

Mr Cameron has denied breaking any code of conduct or government rules and the government has repeatedly said the outcome of his discussions on Greensill’s proposals for access to a Covid-19 loan scheme were not taken up.

In a letter to Mr Cameron, the committee asked the former prime minister to provide a timeline of his contacts with ministers and government officials, and also to state when he first became aware of financial difficulties at Greensill.

11:25 AM

Sales boost for J&J

Over to the US, where Johnson & Johnson has beaten expectations for quarterly revenue and profit and raised dividend payouts to shareholders. It reported $ 100m in sales for its Covid-19 vaccine, whose use was paused by US regulators last week.

The company, which has previously said the vaccine will be available on a not-for-profit basis until the end of the pandemic, also tightened its forecast for adjusted profit this year, showing it largely performed as previously expected.

Use of the vaccine was paused last week by US regulators as they review reports of rare but serious blood clots in recipients.

11:03 AM

Britain buys more Chinook helicopters from Boeing in £1.4bn deal

Chinook

Chinook

The RAF is buying 14 Chinook helicopters from Boeing in a $ 2bn (£1.4bn) deal but will not get them for several years due to budget pressures on the cash-strapped Ministry of Defence.

My colleague Alan Tovey reports:

A “letter of acceptance” from the UK embassy in Washington, which begins the contracts process for the deal ,confirmed Britain wants to buy the Chinook H-47 extended range helicopters.

However, it warned that “as a direct result of the worldwide impact of Covid-19, the UK has had to reconsider the expenditure profile of this project”, Bloomberg reported.

The letter went on to say it wanted to try to avoid any price increases resulting from the delayed deliveries of the heavy-lift helicopters.

Britain is “eager to proactively engage to understand and attempt to mitigate the price and schedule impacts of the three-year deferral while recognising there are many programmatic and industrial base factors which need to be considered”, the letter added.

10:48 AM

More than £5bn wiped off UK tobacco firms

Cigarettes 

Cigarettes

My colleague Oliver Gill has more details on the big tobacco rout. He writes:

More than £5bn was wiped off the value of UK tobacco firms after the Biden administration announced plans to reduce the nicotine content of cigarettes to a level that is not addictive.

British American Tobacco and Imperial Brands both fell around 6pc in morning trade after the announcement on Monday evening.

The tobacco industry has been waiting for a number of years for America’s Food and Drug Administration to decide on whether to cap nicotine levels. Plans were first announced in 2018, with Marlboro-maker Altria saying that it did not think it was possible, nor would it reduce smoking.

The FDA is also mulling a ban on menthol cigarettes, a move that hit BAT particularly hard. Research suggested that menthol cigarettes account for up to 75pc of the cigarettes smoked by African-Americans, with the proportion even higher in younger age groups.

This has led the FDA to consider whether the category disproportionately addicts and kills black Americans.

London-listed BAT merged with Reynolds in 2017 in a deal worth $ 49bn (£40.7bn at the time). Reynolds was one of America’s biggest sellers of menthol cigarettes.

10:27 AM

Market update: FTSE continues to slide

The FTSE’s bad start to the day has gotten worse, with the blue-chip index now trading down 0.9pc.

Tobacco giants Imperial Brands and British American Tobacco are leading the decline following reports that the White House is considering whether to cap nicotine levels in cigarettes.

European market data - Bloomberg 

European market data – Bloomberg

09:56 AM

Asda deal raises competition concerns, says watchdog

The CMA has said the Issa Brothers’ £6.8bn takeover of Asda raises some competition concerns over fuel prices.

The watchdog said the deal could lead to higher petrol prices in some parts of the country.

The buyers now have 5 working days to offer legally binding proposals to the CMA to address the competition concerns identified.

Joel Bamford, senior director of mergers at the CMA, said:

Our job is to protect consumers by making sure there continues to be strong competition between petrol stations, which leads to lower prices at the pump. These are two key players in the market, and it’s important that we thoroughly analyse the deal to make sure that people don’t end up paying over the odds.

Right now, we’re concerned the merger could lead to higher prices for motorists in certain parts of the UK. However, if the companies can provide a clear-cut solution to address our concerns, we won’t carry out an in-depth Phase 2 investigation.

09:48 AM

Government abolishes emergency Brexit permits for truck drivers

Kent 

Kent

The Government has abolished an emergency Brexit rule requiring lorries crossing the English channel to obtain a permit before entering the county of Kent.

From Tuesday, drivers will no longer have to get a Kent Access Permit to show their truck has the right clearances to travel into the European Union, the Department for Transport said.

The government introduced the permit to reduce the risk of traffic chaos caused by lorries not having the right documents to pass post-Brexit border checks.

Drivers who didn’t have the pass faced a £300 fine if they entered the county.

The decision comes as trade with the EU bounces back after a sharp slump in January. UK goods exports rose almost 47pc in February from the previous month.

“Delays have been prevented thanks to hauliers arriving at the border prepared,” the government said in the statement. “Freight volumes between the U.K. and the EU continue to operate at normal levels.” [via Bloomberg]

09:20 AM

Hammerson collects less than half of rent due

Bull ring 

Bull ring

Shopping centre owner Hammerson has revealed less than half of its second quarter rent due has been collected despite retail restrictions easing.

The group, whose property portfolio includes the Birmingham Bullring and London’s Brent Cross, said it had received 48pc of second quarter rent due in the UK as market conditions remained “challenging”.

Across the wider group, rent received stood at 40pc, with £27m still outstanding.

But Hammerson, which last week revealed talks over a potential deal to sell its portfolio of UK retail parks, said a rise in shopper numbers across England was encouraging since the reopening of non-essential retail on April 12.

It said around 90pc of operators in England were now able to trade and so-called shopper footfall at its sites was “competitive with pre-pandemic levels”.

Footfall at its flagship sites is running at around four fifths of what was achieved in the same week in April 2019 before the coronavirus crisis struck.

Hammerson said: “The company continues to work hard with brand partners to focus on improving collection rates on agreed rents.

08:42 AM

Japan should consider scrapping Olympics, says ex-minister

Tokyo

Tokyo

Japan needs to consider scrapping the Tokyo Olympics and speeding up its vaccine roll-out amid growing virus infections, according to former Finance Minister Jun Azumi.

Bloomberg has the details:

“We’re at a point in time when we should seriously consider a cancellation or postponement,” said Azumi, leader of the main opposition party’s parliamentary affairs committee in an interview Monday. He added that recent polls showed 70pc of the public are against holding the Tokyo Games.

With virus cases increasing, the government’s first priority should be to speed up its vaccine drive. To do that, it should cut the red tape that limits the number of people who can give vaccine jabs and distribute doses more efficiently within Japan, he added.

“We need a massive number of people who can actually administer doses,” said Azumi, acknowledging that difficulties securing the vaccines from abroad had also delayed inoculation efforts. “The regulations haven’t been eased and only a limited number of medical professionals have been given permission to administer the shots.”

The comments come amid growing speculation that Prime Minister Yoshihide Suga will soon place Tokyo and some other cities under a third state of emergency as Japan struggles to contain the latest surge in infections. A renewed emergency and tighter restrictions on activity will delay the economy’s recovery while further testing the resolve of policy makers and Olympic organizers to press ahead with the Summer Games.

08:18 AM

Pound eyes $ 1.40

The pound has continued its rally and is closing in on $ 1.40. The currency has been boosted by the recent easing of lockdown restrictions and the roll-out of Covid vaccines.

07:54 AM

Is it time for Primark to embrace online shopping?

Shares in Primark’s parent Associated British Foods have recovered some earlier losses and are currently trading 1.3pc in the red.

Commenting on this morning’s update, Adam Vettese, an analyst at eToro, says:

Primark has long been Associated British Food’s cash-cow, so the fact it has lagged behind other parts of the ABF group over the past year, will have been strange for investors to see.

The primary reason for that is the fact Primark does not have an online shop to sell its goods, meaning it couldn’t generate cash when its stores were closed during the various lockdowns over the past year.

While competitors have ramped up their online offerings over the past 12 months, a lack of e-commerce functionality has cost Primark up to £3bn in sales and £1bn in profit.

I’m sure there will be shareholders out there asking themselves why Primark’s management refuse to adapt to the digital era, when others have profited handsomely from it.

“I’m equally sure management will argue that creating an online store will force it to raise its famously low prices. But at some point, that becomes a price worth paying, if it stops you from being left behind.

07:36 AM

Furlough’s ‘heavy lifting’ keeps lid on job losses

Sunak

Sunak

Unemployment has fallen for the first time since before Covid-19 struck, the Office for National Statistics said today.

My colleague Russ Lynch has a full report on the numbers. He writes:

Economists said the jobs market was “turning the corner” as figures showed a 50,000 fall in unemployed people to 1.67m over the three months to February, pushing the jobless rate down to 4.9pc.

The data marks the first quarterly decline since the quarter to December 2019, the ONS said.

The labour market fall-out has been kept artificially low by the furlough scheme, which was extended for the third lockdown, and has cost the UK £57.7bn so far, according to Government figures.

Companies have placed almost 5m workers in the jobs retention scheme so far, but the Office for Budget Responsibility expects the jobless rate to rise to 6.5pc by the end of the year after furlough closes in September.

More recent indicators suggest a mixed picture for the jobs market as the ONS’s experimental data showed 56,000 fewer workers on company payrolls in March compared to the previous month.

07:14 AM

FTSE falls below 7,000

The FTSE 100 has opened in the red and fallen back below the 7,000 mark as other markets retreat from record highs.

European market data - Bloomberg 

European market data – Bloomberg

06:49 AM

Primark reports ‘record’ sales after reopening

Primark

Primark

Primark reported “record” sales in England and Wales in the first week of reduced lockdown restrictions.

However, the pandemic and forced closure of stores hit its parent company Associated British Foods hard in the six months to February with sales down 17pc to £6.3bn and adjusted profits before tax down by half to £319m.

Primark’s owner also revealed it will repay £121m in furlough cash claimed for workers in the current financial year, including £72m to the UK Government, and will not make any further claims under various government job retention schemes.

Following the decision to repay taxpayer cash, the company also announced it will pay a 6.2p-a-share interim dividend to shareholders worth £49m.

06:34 AM

‘Green shoots of a recovery are emerging’

Bar worker 

Bar worker

Responding to the latest labour market statistics, Tej Parikh, chief economist at the Institute of Directors, says:

While the labour market continues to battle with the pandemic, there are signs it is turning a corner.

The Job Retention Scheme is doing a lot of heavy lifting and is helping to keep a lid on jobs losses. Over 2021 the unemployment rate will creep upward as firms tend to weak balance sheets and furlough support ends in September. Nonetheless, the green shoots of a recovery in the jobs market are emerging.

As more of the economy reopens over the coming months, businesses will look to take on more staff to meet pent-up demand. While vacancies have slowed recently there is likely to be significant growth in new positions over the spring and summer, barring a return to tighter restrictions.

The economy is not out of the woods yet, and the government should remain prepared to extend support if the roadmap meets speedbumps. Meanwhile, it is important that retraining and upskilling schemes hit the ground running to help workers find new opportunities in the post-pandemic economy.

06:19 AM

Payrolls unexpectedly drop

Despite the drop in the headline rate, company payrolls still fell for the first time in four months with more people pulling out of the workforce.

The number of employees on payrolls fell 56,000 in March, according to the ONS. The jobless rate fell to 4.9pc in the quarter through February because the number of people looking for work dropped, with the furlough scheme still propping up a significant number of jobs.

Darren Morgan, director of economic statistics at the ONS, said:

The latest figures suggest that the jobs market has been broadly stable in recent months after the major shock of last spring.

The number of people on payroll fell slightly in March after a few months of growth. There are, though, over 800,000 fewer employees than before the pandemic struck, and with around five million people employed but still on furlough, the labour market remains subdued.

However, with the prospect of businesses reopening, there was a marked rise in job vacancies in March, especially in sectors such as hospitality.

06:06 AM

Breaking: Unemployment drops below 5pc

The UK unemployment rate unexpectedly dropped below 5pc for the three months to the end of February, coming in at 4.9pc compared to analyst expectations of 5.1pc.

05:56 AM

Agenda: Unemployment set to remain steady

Good morning. In a few minutes the Office for National Statistics will release the latest unemployment data, with analysts expecting numbers to remain steady as the economy began to reopen last month.

5 things to start your day

1) UK intervenes in $ 40bn Nvidia-Arm deal on national security: The culture secretary, Oliver Dowden, issued a rare notice intervening in the acquisition by Nvidia, triggering an investigation by the CMA.

2) Rishi Sunak opens door to ‘Britcoin’ digital currency backed by Bank of England: The Treasury and the BoE will examine the viability of a “digital pound” as part of a drive to make the UK’s finance sector more innovative post-Brexit.

3) Ex-Persimmon boss teams with US fund to buy Avant Homes: Yorkshire property developer Berkeley DeVeer has partnered with New York’s Elliott Advisors to take over Avant Homes Group.

4) Taxman misses chance for furlough fraud crackdown, warns watchdog: National Audit Office urges HMRC to update furlough fraud estimates as criminals adapt to extensions of wage subsidy scheme.

5) Asda billionaires pile their plate high with Leon takeover: Insiders say the Issa brothers want to turn their petrol station forecourts into destinations for shoppers, making miniature shopping centres.

What happened overnight

Asian stock markets were mixed on Tuesday after Wall Street was pulled lower by tech stock declines.

Tokyo and Hong Kong retreated while Shanghai and Seoul gained.

The Shanghai Composite Index gained 0.1pc to 3,481.52 while the Nikkei 225 in Tokyo tumbled 1.9pc to 29,114.27. The Hang Seng in Hong Kong shed less than 0.1pc, to 29,099.73.

The Kospi in Seoul rose 0.3pc to 3,209.13 and the S&P-ASX 200 in Sydney sank 0.4pc to 7,038.20. New Zealand, Singapore and Jakarta declined while Bangkok advanced.

Coming up today

Corporate: Associated British Foods (Interim); Petra Diamonds, Avast (Trading update)

Economics: Unemployment rate (UK); producer price index (Ger), consumer confidence (Ger)