UK Edition
Barclays sheds 5,000 jobs amid cost-cutting drive
Barclays cut its workforce by around 5,000 last year as part of an ongoing push to strip costs from the lender.
The bank confirmed the size of the job losses for the year ending December 2023 after reports emerged that it was planning to cut 2,000 jobs in a £1bn cost-cutting drive.
Investors are awaiting an update in February from chief executive CS Venkatakrishnan, also known as Venkat, which could lay out further cost reduction plans.
Barclays Execution Services, a division which offers legal, HR and compliance services to the Barclays empire, bore the brunt of the losses, it said.
It is the first time the bank has put a number on the headcount reduction for last year, which was first reported by Sky News.
The losses are equal to around 6pc of Barclays global workforce of 84,000. Around a quarter of reductions took place in the UK and have been lost through a combination of redundancies and roles not being filled, Sky News reported.
In November, unions flagged 900 jobs that were set to be lost. These are likely to have been part of the 5,000 figure.
Barclays has been seeking to cut costs to revive its flagging share price which has fallen by 18pc over the past year to 154p.
It has struggled to compete with Wall Street rivals, while growing digitisation and automation of banking has removed the need for many back office functions, leaving staff vulnerable.
Venkat is expected to announce a restructuring of the bank at annual results next month, which could include fresh cost targets
The bank hinted to investors in September that there would be a “material” restructuring charge for the quarter ending December.
However Venkat has been vague about how much of the restructuring charge would form part of February’s restructuring plan.
Gary Greenwood, an analyst at Shore Capita, said: “It doesn’t come as a surprise they are taking out headcount because that’s what they said they would do to address structural costs.
“This is part of that. I expect there will be more to come, among other things.”
A Barclays spokesman said: “Barclays removed approximately 5,000 headcount globally through 2023 as part of its ongoing efficiency programme designed to simplify and reshape the business, improve service, and deliver higher returns. The group is also creating capacity to selectively hire front office roles in key businesses.”
Read the latest updates below.
Nvidia shares rise on new product launches
Shares in AI chipmaker and graphics card giant Nvidia jumped nearly 5pc today after the company announced new products aimed a gamers and heavy users of graphics at the Consumer Electronics Show in Las Vegas.
The chipmaker also said that its new products would not fall foul of US rules aimed at limiting the export of AI chips to China, according to a Bloomberg report.
Land Rover sales grow as JLR moves to tackle epidemic of thefts
Jaguar Land Rover (JLR) has reported a rise in sales towards the end of 2023, as bosses acted to stop the Range Rover from remaining Britain’s “most stolen” car, writes Matt Oliver:
The carmaker on Monday said it sold 101,043 vehicles to wholesale customers in the final three months of last year, up 27pc compared to a year earlier.
This included 16,921 Range Rover Sports, an increase of 49pc, and 18,843 Range Rovers, up 12pc. Sales of the Land Rover Defender also rose 14pc to 27,117 cars.
It comes after JLR patched holes in the security of thousands of its luxury Range Rover and Land Rover models after they became the target of car thieves.
The cars were among the most stolen in the UK last year because of their high resale value and keyless technology which was exploited by criminals.
FTSE closes in the green
The FTSE 100 was virtually unchanged today, closing up 0.06pc. The biggest riser was aerospace business Melrose Industries, up 4.31pc, followed by discount retailer B&M, up 3.16pc. The biggest faller was Shell, down 3.11pc, followed by BP, down 2.62pc.
Over in the mid-cap FTSE 250, Drax was up 9.53pc on news that the Government wants to use its for a carbon capture scheme, with the second-biggest riser being Plus500, up 8.01pc. The biggest faller was mining company Ferrexpo, down 5.56pc, followed by Tullow Oil, down 5.25pc.
Barclays shrinks by 5,000 in efficiency drive
Barclays cut its headcount by 5,000 jobs in 2023, around 5pc of its global workforce, as part of a renewed impetus to cut costs.
The jobs were lost through a mix of redundancies and vacancies which will not be filled following a hiring freeze, according to a Sky News report. Around a quarter of the reductions reportedly took place in in its UK operations.
A Barclays spokesperson said:
Barclays removed approximately 5,000 headcount globally through 2023 as part of its ongoing efficiency programme designed to simplify and reshape the business, improve service, and deliver higher returns. The Group is also creating capacity to selectively hire front office roles in key businesses.
The majority of the individuals impacted are within Barclays’ support function, Barclays Execution Services “BX”, and the Barclays UK Chief Operating Officer function, as management layers are reduced and the Group improves its technology and automation capabilities. We are supporting impacted colleagues with training, advice and outplacement services, depending on their location.
Barclays shares were down 0.58pc in trading today.
Volkswagen adds ChatGPT to its cars
Volkswagen is to integrate the AI chatbot ChatGPT into its cars from later this year.
The German carmaker said Volkswagen’s existing in-car voice assistant, IDA would gain access to ChatGPT, allowing users to access a “multitude of new capabilities that go far beyond the previous voice control”.
Volkswagen said users will be able to use the enhanced system to activate in-car navigation, as well as control air conditioning and ask general knowledge questions.
The car firm said drivers will not be required to create a new account or download any new apps in order to use the new service.
Instead, they will be able to activate it simply by saying “Hello IDA” or by pressing a button on the steering wheel.
Volkswagen said ChatGPT would not gain access to any vehicle data, with conversation history deleted immediately afterwards.
Kai Grunitz, VW board member for technical development, said:
Volkswagen has always democratised technology and made it accessible to the many. This is simply ingrained in our DNA.
As a result, we are now the first volume manufacturer to make this innovative technology a standard feature in vehicles from the compact segment upwards.
Former Tory donor’s hedge fund hit by bond market turmoil
Chris Rokos’s fund has suffered losses after banking instability triggered a surge in bond prices. Michael Bow has the details:
Former top Tory donor Chris Rokos made a slimmer return for his investors last year after his hedge fund was caught up in the bond market turmoil triggered by Silicon Valley Bank’s collapse.
Rokos Capital Management, the trader’s eponymous investment business, returned 8.8pc for investors in 2023 after cutting exposure to riskier investments.
The 8.8pc return for 2023 is a significant step down from the 51pc return the fund generated in 2022. Bloomberg first reported the 2023 return figure.
The hedge fund suffered losses after the unexpected collapse of Silicon Valley Bank earlier in the year prompted a surge in bond prices.
City broker says the Government should have powers to block flotations that exclude London
A top City broker has suggested that the Government should consider taking “direct action” to block British companies from embarking on inital public offerings without including a London listing.
Charles Hall, head of research at Peel Hunt, said:
The lack of tools to persuade Arm to list in the UK was clearly apparent. There could be a mechanism where approval for certain businesses to list overseas is required or at least a secondary listing in the UK is put in place.
The broker said that the Government had been “asleep at the wheel”, and that a strong equity market helps to “stimulate economic growth, a more prosperous population and higher tax revenue”.
He noted that UK listed companies “generally pay a full tax contribution”, whereas “many private companies are structured to avoid/reduce tax”.
Mr Hall also urged the Government to introduce corporation tax incentives for being listed in the UK, and encourage greater use of Save As You Earn schemes in which employees can buy shares in their employer, backed by a tax incentive.
Johnson & Johnson buys cancer biopharma company
Johnson & Johnson is stepping up its investment in anti-cancer drugs, telling investors today that it is to buy out Ambrx, a Nasdaq-listed biopharma company developing potentially better drugs aimed at treating prostate, breast and other cancers.
J&J is paying $1.9bn (£1.5bn) in an all-cash transaction.
Dr Yusri Elsayed of J&J said:
Ambrx’s ADC [antibody drug conjugates] technology offers unique advantages ... which results in engineered ADCs that effectively kill cancer cells and limit toxicities. The results seen to date with [the Ambrx’s drug] ARX517 in mCRPC [metastatic castration-resistant prostate cancer] are promising and represent a potential first- and best-in-class targeted therapy for the treatment of this aggressive disease.
In addition, Ambrx’s pipeline and ADC platform present exciting future opportunities to deliver enhanced, precision biologics as we look to transform the treatment of cancer and improve patients’ lives.
J&J shares are down 0.88pc in trading this afternoon. Ambrx is up 100.39pc.
Google AI company strikes drug discovery deals worth $3bn
An artificial intelligence (AI) business backed by Google has secured $3bn (£2.4bn) worth of deals with the pharmaceuticals industry to discover new drugs, reports Matthew Field:
Isomorphic Labs, which was spun out of Google’s AI lab DeepMind, has signed deals with Eli Lilly and Novaratis to help develop new treatments.
Founded by DeepMind chief executive Demis Hassabis in 2021, Isomorphic is trying to find commercial uses for the lab’s breakthroughs in protein mapping.
DeepMind’s AI breakthroughs have allowed it to map nearly all protein structures known to man using the company’s “AlphaFold” tools.
Revealed in 2020, AlphaFold has been credited with major advances in predicting the structure of proteins, solving the so-called “protein folding problem” that had eluded scientists for decades. It is hoped that the discovery will help uncover new ways to tackle diseases.
The AI technique has already been used to catalogue the 3D structures of 200 million proteins. By mapping the structures, researchers can use the technology to predict how different medical treatments will work.
The technology has been hailed as a major breakthrough in biomedical science and could have uses in tackling antibiotic resistance and plastic waste.
AlphaFold has already been used for drug development, with scientists synthesising a new drug to treat a common form of liver cancer.Isomorphic, which is owned by Google’s parent company Alphabet, will receive $45m from US pharmaceutical giant Eli Lilly in a deal that could be worth up to $1.7bn. Swiss group Novartis will also pay $37.5m upfront in a deal that could be worth up to $1.2bn.
Auditors hit with record fines
The value of fines levied by the Financial Reporting Council (FRC) against auditors hit a record £33.2m in 2022/23, up from £32.8m the year before, and £19m in 2020/21, according to research by Thomson Reuters.
Adding in the FRC’s costs, which the auditors have also had to pay, the total penalties levied hit £40.4m last year.
Kyle Gibbons of Thomson Reuters said:
The sheer cost of fines issued in 2023 by the FRC demonstrates that the regulator is using serious sanctions to help improve the quality of audits across the industry in Britain.
Inherited money and parental support trump banks for startup funding
Families are more important than banks when setting up a business, new research from weath manager Charles Stanley has suggested.
It found that one in five businesses are initially funded by inherited money, with almost the same number (19pc) funded by parents.
Entrepreneurs remain reliant on family for subsequent growth funding, with 15pc using inheritance for further growth investment.
Only 21pc are reliant on bank funding for startup funding, and 23pc rely on banks for subsequent growth funding.
Andrew Meigh, managing director of financial planning at Charles Stanley, said:
[This] study reminds us that UK business is, at least in part, a family institution. For many entrepreneurs starting a new venture it is their own savings or inheritance on the line, so it is important that there are conversations about their personal and family wealth alongside a drive to build their business in the most tax efficient way.
Handing over
I’m heading off now and will leave you in the cool hands of Alex Singleton.
My parting gift today is this image of ORo, the robot dog companion at CES 2024 in Las Vegas.
The smart robot is designed to keep a watchful eye on your pooch while you are out, navigating your home, playing catch, managing routines, and ultimately giving peace of mind.
Offshore oil legislation is 'smoke and mirrors,' says senior Tory MP
Prime Minister Rishi Sunak’s plans to maximise North Sea oil and gas production give the impression he is “not being serious” about tackling climate change, a senior Tory has said.
Former cabinet minister Sir Alok Sharma, who was president of the international Cop26 climate summit hosted by the UK, said he will not support the Offshore Petroleum Licensing Bill when MPs vote on it later.
He said the legislation is a “smoke and mirrors” exercise which reinforces the perception that the UK is “rowing back from climate action”.
The Bill will require the industry regulator to run annual rounds for new oil and gas licences, subject to stringent new emissions and imports tests.
Currently licensing rounds are run when the North Sea Transition Authority (NTSA) decides it is necessary.
The Government claims the introduction of regular licensing for exploration will increase certainty, investor confidence and make the UK more energy-independent.
Music venue saved after raising £35,000 in 22 hours
A music venue in south London has been saved from closing its doors after receiving £35,000 in donations in less than 24 hours, which the business co-founder said was “insane”.
Keiron Marshall, 34, co-founded The Sound Lounge - a grassroots music venue specialising in live concerts and serving plant-based food - with his wife, Hannah White, 44.
The couple, who have been married for eight years, originally opened a venue in Tooting in 2016 and relocated to Sutton in 2020 during the pandemic.
Mr Marshall said their business was “a week away” from having to close following outstanding bills, soaring energy costs and the price of purchasing stock from suppliers.
The couple met with their financial advisers and it was agreed that £35,000 would be needed to cover any outstanding fees which could “potentially threaten” the business with closure.
They launched a Crowdfunder on Friday, thinking it would take weeks to raise the full amount, but they did so in just 22 hours.
Mr Marshall, said: “When we hit it, I could not believe it - Hannah was crying her eyes out for most of the day.”
Boeing and supplier shares slump after mid-flight blowout
Shares in Boeing, Alaska Air Group and Spirit AeroSystems all tumbled on Wall Street as federal regulators grounded some Boeing 737 Max 9 aircraft.
Investigators are focused on a door plug made by Spirit AeroSystems after an unused exit door opening on an Alaska Airlines flight blew out after takeoff over Oregon on Friday.
Spirit AeroSystems, which builds the fuselage for Boeing’s 737 Max, slid more than 14pc, while Boeing fell 9.2pc and Alaska Air Group lost 4.3pc.
Apple VR headset to go on sale next month, says Tim Cook
Apple’s debut augmented reality headset will go on sale on February 2 in the technology giant’s biggest product launch since the iPhone.
Our senior technology reporter Matthew Field has the latest:
The Apple Vision Pro will be available for pre-orders from January 19 and go on sale in the US a fortnight later.
The headset is a key test for Apple. Virtual and augmented reality goggles have remained a niche interest for technology fans but not as popular as smartphones or tablets.
The Vision Pro will cost $3,500, making it one of Apple’s most expensive devices, and come with new software that superimposes apps, videos and games over the real world.
Rivals including Facebook-owner Meta have been exploring virtual and augmented reality. Meta has launched several headsets under its “Quest” brand.
The launch of the Vision Pro comes amid concerns from analysts over flagging iPhone sales at the $2.8trn tech giant.
Apple’s chief executive Tim Cook said: “Apple Vision Pro is the most advanced consumer electronics device ever created. Its revolutionary and magical user interface will redefine how we connect, create, and explore.”
Boeing tumble drags down Dow Jones
The Dow Jones Industrial Average opened lower as it was hurt by a tumble in Boeing shares following the grounding of some its jets.
The Dow fell 138.74 points, or 0.4pc, at the open to 37,327.37.
Meanwhile, megacap stocks lifted the S&P 500 and the Nasdaq. The S&P 500 opened higher by 6.46 points, or 0.1pc, at 4,703.70, while the Nasdaq Composite gained 40.39 points, or 0.3pc, to 14,564.47 at the opening bell.
US profit margins collapse in 'very dangerous' sign of weakness
Private US companies are dealing with collapsing profit margins as they contend with impact of interest rates that remain at 23-year highs, according to a new report.
Middle market companies “are in crisis” due to high inflation and soaring rates “threatening to unleash a wave of corporate restructurings,” according to a white paper released by Marblegate Asset Management and Rapid Ratings.
In stark contrast, the report said that large public companies have the tools, resources, and flexibility to respond to today’s difficult economic environment.
Andrew Milgram, managing partner and chief investment officer at Marblegate, said: “The water looks fine from the shore but what’s happening underneath the surface is a very very troubled environment that is very dangerous.”
Marblegate and Rapid Ratings looked at about 1,200 private companies with revenue between $100m and $750m for their research. It also examined about 2,230 publicly traded companies with revenue of $750m or more.
France targets more London finance firms to 'take advantage of Brexit'
Emmanuel Macron’s government will present a bill of measures aimed at luring more of London’s financial businesses to France as he tries to “take advantage of Brexit”.
France’s finance minister Bruno Le Maire said Europe’s second largest economy had already been able to “attract the world’s biggest financial establishments to Paris” since Britain’s decision to leave the EU.
In a New Year’s address to business leaders, he also said that economic growth will accelerate in 2024 and that inflation will ease to below 3pc in the first half of the year.
Mr Le Maire said:
We were able to take advantage of Brexit to attract the world’s biggest financial establishments to Paris.
To strengthen this position, a bill on financial attractiveness will be presented to parliament in spring.
Amazon tipped to return to record high - as Apple falters
Amazon shares are poised to push toward record high levels after a slow start to the year, according to analysts.
Bank of America, Citigroup, Deutsche Bank, Goldman Sachs and JPMorgan are among the institutions naming the online retail giant as their top e-commerce or internet stock for 2024.
Some 97pc of analysts tracked by Bloomberg recommended the stock. The average analyst price target suggests upside of roughly 26pc.
The optimism is in stark contrast to views of rival Big Tech stock Apple, after an iPhone sales slump in China deepened.
Jefferies analysts said the company is likely to see volumes decline further this year. It was the third bearish note on the world’s largest company in three days.
EU approves £775m state aid for electric vehicle battery plant
The EU has approved German plans to provide €900m (£775m) in state aid to an electric vehicle battery maker as it seeks to lure investment in the face of Joe Biden’s hefty green subsidies.
The bloc has given the green light to Germany’s subsidies to Swedish battery maker Northvolt for a plant in Germany’s northern Schleswig-Holstein region, which will be the first constructed outside the company’s home country.
EU competition chief Margrethe Vestager said without the state aid, Norvolt would have made the investment in a new plant in the US, where large subsidies are on offer under Joe Biden’s Inflation Reduction Act.
FTSE 100 dragged down by falling oil prices
The FTSE 100 has continued to be weighed down by the energy sector and precious metals miners, both of which are taking a hit from falling commodity prices.
The UK’s blue chip index has fallen 0.2pc so far today, with the FTSE 250 up 0.1pc.
Oil and gas companies have dropped as much as 2.1pc as Brent crude drops 2.9pc towards $76 a barrel. A trading update from Shell also hurt the sector as the company warned of a fourth quarter impairment of up to $4.5bn (£3.5bn).
Meanwhile, precious metals miners have slumped as much as 2.1pc as the price of gold has dropped a further 1pc today to about $2,022 an ounce as investors bet on rapid interest rate cuts by the US Federal Reserve.
Building materials supplier issues profit warning amid construction downturn
Online building materials supplier CMO warned over annual earnings as it said economic uncertainty continues to hit the construction and home repairs sector.
Plymouth-based CMO, which claims to be the UK’s largest online-only retailer of building materials, said orders had been lower than usual at the end of 2023 as homeowners shifted towards less profitable smaller building and repair projects.
Sales for the full year are expected to fall 14pc to around £71.5m, roughly as expected, but the company warned that underlying earnings are now expected to plummet to around £1m - less than half the £2.1m notched up in 2022.
In August, it had guided for underlying earnings of around £2.5m.
Chief executive Dean Murray said: “With macro-economic headwinds continuing to impact the construction sector, we proceed with caution for the outlook for 2024, but remain confident in our model and strategy to take the business forward, and our ability to deliver profitable progress.”
But CMO said that, despite the disappointing last quarter, it had successfully delivered on some key strategic priorities, including improving product margins and carriage cost control.
Britain’s construction sector has been under pressure after interest rates have been raised to levels not seen since the 2008 financial crisis, with the Bank of England pushing through 14 increases in a row until finally pausing in September last year.
Germany to give green light to UK deal to sell Eurofighter jets to Saudi Arabia
Chancellor Olaf Scholz’s government has defended plans to lift Germany’s longstanding veto on sales of Eurofighter jets to Saudi Arabia, saying Riyadh has adopted a “constructive approach” in the Israel-Hamas war.
Germany, Britain, Italy and Spain jointly build the jet and each can veto deals. Berlin has blocked one deal, sought by the UK, since 2018.
However, German Foreign Minister Annalena Baerbock, on a visit to Israel on Sunday, signalled that Berlin was ready to lift its blockade.
She said: “We do not see ourselves, as the German federal government, opposing British considerations on other Eurofighter (sales).”
She underlined the Saudi role in the Middle East security crisis since the eruption of the Israel-Hamas war on October 7.
Mr Scholz “shares this assessment,” his spokesman said on Monday at a press conference, noting that “it is an open secret that Saudi Arabia’s airforce has used Eurofighters to shoot down rockets launched by the Huthis on the way to Israel”.
Germany has blocked arms sales to Riyadh since the 2018 murder of dissident journalist Jamal Khashoggi in the Saudi consulate in Istanbul.
That includes blocking a deal for 48 Eurofighter jets signed by Saudi Crown Prince Mohammed bin Salman in London.
BT's new boss to start in February
Allison Kirkby will take over as the new chief executive of BT on February 1, the telecoms giant has confirmed.
Ms Kirkby, who will become the company’s first female boss, will take over from Philip Jansen, who will step down after five years leading the business.
BT’s share price has fallen 0.1pc today to 121.2p.
Apple suffers iPhone sales slump in China
Apple’s iPhone slump is deepening in China, where sales of the latest model plunged by 30pc year on year in the first week of 2024, according to analyst Jefferies.
The tech giant lost ground to China’s native mobile market, which grew in December, led by Huawei with its new range of Mate 60 devices, estimated to have shipped 35m smartphones in 2023.
In contrast, Apple suffered a double-digit fall in sale volumes in December, according to a note from Jefferies citing industry checks.
Jefferies warned Apple faces a similar decline this year.
Ministers call for former Post Office chief exec to lose CBE
Rishi Sunak is under pressure to intervene in the Post Office honours row as a petition calling for the former chief executive to lose her CBE approaches one million signatures.
Our political editor Ben Riley-Smith has the latest:
More than one million people have signed an online petition calling for Paula Vennells, who led the Post Office when sub-postmasters were wrongfully prosecuted, to be stripped of the honour.
Two cabinet ministers also said the former chief executive should lose her CBE awarded in 2019 over the Horizon IT scandal, described as “the worst miscarriage of justice in recent British legal history”.
Mr Sunak said on Sunday ministers were considering options including exonerating all those unjustly convicted, and stripping the Post Office of handling the appeals process, with announcements expected this week.
Read how backbench campaigners over the scandal are attempting to force a debate in the House of Commons today or tomorrow.
And relax... the CES 2024 show is here
The Consumer Electronics Show (CES) 2024 has got underway in Las Vegas, meaning we will be furnishing you with lots of stories of weird and wonderful developments from the world of technology over the next week.
Here a delegate is trying out a Phantom Neo massage chair, which works with separately moving left and right sides and relaxes users with pulsed electromagnetic field technology.
Wall Street poised for slump after Boeing grounds jets
US stock markets slipped ahead of the opening bell, with Boeing tumbling after the grounding of more than 170 jets following a mid-flight blowout.
Boeing nosedived 8.7pc in trading before the bell after the US Federal Aviation Administration (FAA) ordered the temporary grounding of some 737 MAX 9 jets fitted with a panel that blew off an Alaska Air Group jet in midair on Friday.
The aircraft manufacturer could lose about $12.5bn in value if losses hold through market open.
Alaska Air Group slid 4.6pc after the carrier cancelled more than 200 flights following the FAA order, while other airlines like JetBlue Airways, Delta Air Lines and United Airlines lost between 1.4pc and 3pc.
AJ Bell investment director Russ Mould said:
Boeing’s reputation has been shattered after the incident last Friday involving one of its 737 MAX planes.
It is the latest in a string of problems for the company, which include the grounding of 737 MAX plans in 2019 after two crashes and subsequent delivery delays and production issues.
In premarket trading, the Dow Jones Industrial Average was down 0.6pc, the S&P 500 had fallen 0.3pc and the Nasdaq 100 had dropped 0.3pc.
Pound slips as dollar rallies
The pound has edged down on a relatively quiet day for UK economic data as the US dollar continued its rally.
Sterling was 0.1pc lower at $1.27 after the dollar posted its biggest weekly rise against major currencies since July, putting a halt to the declines seen in late 2023.
The dollar index rose 1pc last week, the most in six months, as data showed a sharp slowdown in inflation around the world, driving expectations of central bank rate cuts, particularly by the Federal Reserve, and sparking a rally in equities.
Against the euro, the pound was down 0.1pc at 86p.
Oil slumps as Saudi Arabia cuts prices
Oil prices have fallen after Saudi Arabia cut its prices for exports to Asia to the lowest level since November 2021.
Saudi Aramco cut the official selling price for its flagship Arab Light crude to a $1.50-a-barrel premium to the regional benchmark for February.
The $2-a-barrel reduction was deeper than had been foreseen, and follows a weakening in the price of Middle Eastern crudes, lacklustre demand from China and surging global supplies.
Oil posted the first annual loss since 2020 last year as production expanded from outside the Opec+ cartel.
Brent crude, the international benchmark, has slumped by 2.1pc today toward $77 a barrel, while US-produced West Texas Intermediate has dropped 2.3pc toward $75.
Three energy companies allowed to forcibly install prepayment meters
EDF, Octopus and Scottish Power have been given permission to return to forcibly fitting prepayment meters (PPMs) after they were temporarily banned following a scandal around the practice.
Ofgem said the three companies had met its set of conditions, which include conducting internal audits to identify PPMs wrongfully installed before the February 2023 moratorium and offering compensation and a return to a non-prepayment payment method to any affected customers.
Once suppliers meet the conditions and restart “involuntary” PPM installations, they must also provide regular monitoring data to Ofgem to identify any concerning practices.
Customers and consumer groups will be able to check energy suppliers that can install prepayment meters without a household’s permission on the Ofgem website.
EDF, Octopus and Scottish Power will still have to make at least 10 attempts to contact a customer before a prepayment meter is installed and carry out a site welfare visit before proceeding.
They are not allowed to forcibly fit a PPM if the household is considered to include “highest risk” customers, including those which require a continuous energy supply for health reasons, have an older occupant aged 75 and over without support, or those with children under two years old.
Britain’s richest woman paid £265m – despite her business empire making a loss
Britain’s richest woman Denise Coates saw her pay rise by £7m to just over £220m last year, despite her family’s gambling empire Bet365 making a loss.
Our reporter Michael Bow has the details:
Ms Coates took home a total of £265m in salary and dividends from Bet365 last year, new account filings show.
The billionaire received £220.7m in salary, up from £213m a year earlier. She also gained from a dividend of around £45m, on par with the same payout last year.
Ms Coates is one of the world’s best paid executives and regularly tops the list as Britain’s best paid chief executives. She earns roughly £1m for every working day of the year before tax.
She has run Bet365 since it launched from a portakabin in Stoke 20 years ago. As well as the company’s founder and chief executive, she is Bet365’s majority owner.
Boeing plane was restricted after warning light appeared, say investigators
The Boeing plane that suffered a blowout mid flight over America was not being used for flights to Hawaii after a warning light that could have indicated a pressurisation problem lit up on three different flights, a federal official said.
Jennifer Homendy, chair of the National Transportation Safety Board, said Alaska Airlines decided to restrict the aircraft from long flights over water so the plane “could return very quickly to an airport” if the warning light reappeared.
Ms Homendy cautioned that the pressurisation light might be unrelated to Friday’s incident in which a plug covering an unused exit door blew off the Boeing 737 Max 9 as it cruised about three miles (4.8 kilometers) over Oregon in the US.
Drax shares jump ahead of expected carbon capture approval
Drax shares have gained as much as 7.8pc in early trading after The Telegraph revealed ministers are preparing to approve a multibillion-pound CO2 capture scheme it claims would make it “carbon negative”.
The scheme has infuriated greens already angered by Drax’s switch from coal to wood – burning eight million tonnes last year alone. They say Drax’s clear-cutting of forests in North America destroys the environment rather than supporting it.
Next week, however, Energy Secretary Claire Coutinho is expected to secure Drax’s future by approving a scheme to bolt two massive carbon capture plants onto Drax’s four generating units, potentially stripping out almost all the CO2 emissions from what was once the UK’s dirtiest coal-fired power station.
Channel 4 plots job cuts after advertising slump
Channel 4 is reportedly preparing to make its largest job cuts since the global financial crisis as bosses contend with a slump in TV advertising.
The broadcaster could cut as many as 200 jobs, according to the Guardian, after its staff numbers swelled to a record level of more than 1,200, putting its wage bill at more than £108m.
A Channel 4 spokesman told the newspaper: “Like every organisation, we are having to deal with an extremely uncertain economy in the short term and the need to accelerate our transformation to become a wholly digital public service broadcaster in the long term.
“As a result, we need to continue to divest from our linear channels business and simplify our operations to become a leaner organisation.”
Channel 4 reduced its headcount by 200 people when the TV advertising market slumped during the 2008 financial crisis, which amounted to nearly a quarter of its then 875 permanent employees.
Boeing shares slump after jets grounded
Boeing shares have slumped by 9pc in premarket trading in New York after more than 170 of its passenger jets were grounded after a refrigerator-sized hole opened up in a plane mid-flight.
Phones, magazines and even the shirt off a child’s back were sucked out of an Alaska Airlines service from Oregon to California on Friday, prompting concerns about the Boeing 737 Max 9 plane used by commercial airlines all over the world.
The US Federal Aviation Administration (FAA) has grounded 171 US-operated planes while officials perform safety checks. Britain’s Civil Aviation Authority (CAA) has demanded that all planes of the same model are inspected before entering UK airspace.
Gas prices slump as supplies remain high despite cold snap
Wholesale natural gas prices have dropped sharply after a cold snap across Britain and Europe failed to have a significant impact on supplies.
Dutch front-month futures - the European benchmark - have fallen 6.3pc toweard €32 per megawatt hour, while the UK equivalent contract has dropped 6.8pc to nearly 81p per therm.
Prices are down about 20pc since the start of October after a mild winter and lower usage during cold period left record storage levels still unusually high.
Storage sites remain 85pc full across the continent.
Rolls-Royce sales boosted by North America and China
Rolls-Royce Motor Cars achieved “extraordinary” record sales last year, the luxury car-maker announced.
It said 6,032 cars were delivered to customers in 2023, which was 11 more than during the previous 12 months.
Global sales were led by North America and China, with year-on-year growth in Europe, Asia-Pacific and the Middle East.
Rolls-Royce Motor Cars chief executive Chris Brownridge, who took on the role after Torsten Muller-Otvos stepped down at the end of November, said: “2023 was another extraordinary year for Rolls-Royce, with strong sales performances in all regions and across the full product portfolio.
“It’s especially encouraging to see the enormous interest in and demand for Spectre, supporting the decision to adopt a bold, all-electric strategy for future model development and production.”
Some 180 jobs were created at the BMW-owned company’s headquarters in Goodwood, West Sussex, in 2023, taking the site’s total workforce to more than 2,500.
FTSE 100 falls as miners hit by falling price of gold
The FTSE 100 has extended losses from last week as investors look ahead to updates from Britain’s major supermarkets this week and a slew of economic data.
The blue-chip FTSE 100 fell 0.3pc, while the midcap index FTSE 250 moved 0.2pc higher.
Precious metal miners led the losses among sectors, falling 1.7pc to a near three-month low, as gold prices slipped on fading expectations of an early rate cut in the US.
The index fell close to 9pc last week.
Shell slipped 1.7pc as it flagged impairment charges of about $2.5bn to $4.5bn (£2bn to £3.5bn) for the fourth quarter, mainly related to the Singapore refining and chemicals hub the oil major is looking to sell.
CMC Markets soared 20pc after the online trading platform raised its full-year operating income forecast after a strong third quarter driven by improved market conditions.
In economic data this week, US inflation figures will be published on Thursday and the UK’s November GDP data on Friday, while there will also be quarterly reports from some of Britain’s biggest retailers and homebuilders.
CMC Markets buoyed by return of institutional investors
CMC Markets shares surged after the online trading platform boosted its profit outlook.
The financial services company said improving market conditions, led by increased activity from B2B and institutional investors, had led to a strong performance in the third quarter of its 2024 financial year.
Its shares surged by 17pc after it said it expects full-year operating income to be between £290m to £310m, up from previous guidance of £250m to £280m.
German economy hit by disappointing factory orders and farmer protests
German factory orders increased by much less than expected in November in a blow to the eurozone’s hopes of avoiding a recession - just as farmers held protests which blocked roads in Europe’s largest economy.
Manufacturing orders grew by 0.3pc, well below analyst expectations of a gain of 1.1pc, according to the Destatis statistics office.
However, it was an improvement on a 3.8pc drop in October.
Meanwhile, exports increased 3.7pc from October in the biggest monthly jump in more than one and a half years.
It comes as farmers blocked highway access roads in parts of Germany this morning and gathered for demonstrations, launching a week of protests against a government plan to scrap tax breaks on diesel used in agriculture.
Chancellor Olaf Scholz’s unpopular three-party coalition infuriated farmers last month by drawing up plans to abolish a car tax exemption for farming vehicles and the diesel tax breaks. The proposals were part of a package to fill a €17bn (£14.6bn) hole in the 2024 budget.
Shell expects boost to gas trading
Shell said profits from gas would be “significantly higher” in the fourth quarter, although earnings from oil products and chemicals will be lower.
The FTSE 100 energy giant said gas profits would be up on the previous three months after it benefited from seasonal shifts in the market.
However, it said its chemicals and products segment would make a loss over the period.
Shell’s gas trading division has been a major source of income since Russia invaded Ukraine in February 2022, prompting a total realignment of the market.
Chinese property giant crisis deepens as third executive arrested
A top executive of China Evergrande’s electric vehicle company has been detained by police in the latest sign of trouble for the world’s most heavily indebted property developer.
China Evergrande New Energy Vehicle announced the detention of Liu Yongzhuo, its vice chairman and an executive director, in a notice to the Hong Kong Stock Exchange.
Its shares plunged as much as 23pc after they resumed trading later in the day.
Mr Liu is the second executive from the company to come under investigation in recent months, following the announcement in September that chairman Xu Jiayin was “subject to mandatory measures” from Chinese authorities over “crimes”.
It comes at a turbulent time for Chinese markets after Zhongzhi Enterprise Group, a major shadow bank in China that has lent billions in yuan to property developers, filed for bankruptcy liquidation after it was unable to pay its debts.
A crackdown on excessive borrowing that began several years ago has left dozens of Chinese developers out of business or struggling for survival.
The industry-wide meltdown has snagged a vital cog in China’s economic engine, reverberating through financial markets.
Share prices sank in Hong Kong and Shanghai, with the benchmark Hang Seng index down 2.2pc. Evergrande Group’s shares lost 1.4pc.
Good morning
Channel 4 is preparing to axe more than 200 jobs as it tries to address a slump in television advertising, it has been reported.
Bosses are seeking to reduce its £108m wage bill after staff numbers swelled to a record 1,200, according to the Guardian.
Elsewhere, Britain is more attractive than Europe for manufacturing firms, factory bosses have said, as “a newfound sense of optimism” sweeps the industry.
Most manufacturing chiefs believe the UK is now a competitive location for their business, according to a new report from industry group Make UK and PwC, and is set to pull further ahead of European rivals.
The majority of bosses also believe Britain’s competitive edge over Germany, France, Italy and Spain will grow rather than shrink this year, the report found.
5 things to start your day
1) OpenAI warns copyright crackdown could doom ChatGPT | Ban on use of news and books to train chatbot risks making services ‘impossible’ to create
2) Belstaff reliant on Sir Jim Ratcliffe to stay afloat as losses mount | Iconic British jacket brand faces ‘material uncertainty’ after £28.9m hit
3) Rise in dementia cases risks sparking jump in family legal battles | Lawyers warn over surge in care and inheritance disputes as prevalence of illness grows
4) Musk denies drug use claims amid concern from Tesla executives | The entrepreneur said that in three years of random drugs testing “not even trace quantities were found of any drugs or alcohol.”
5) Oil and gas will power Britain for decades to come, says North Sea Transition chief | Interview: Stuart Payne on why new drilling licences are crucial for the UK’s energy security
What happened overnight
Leaders in the US Congress announced a top-level deal on spending totals, opening the way for more detailed talks on the substance of fiscal packages, and potentially reducing the chance of a shut down of parts of the American Government later this month.
President Joe Biden said the $1.6trn federal spending limit agreed by the Democratic and Republican leaders in Congress “moves us one step closer to preventing a needless government shutdown and protecting important national priorities.”
But a more detailed deal needs to be negotiated and passed before 19 January to avoid parts of the public sector running out of money.
Meanwhile, major Asian stock markets retreated after Wall Street logged its worst week since Halloween.
Oil prices fell after Saudi Arabia on Sunday cut oil prices to Asian markets to their lowest level in 27 months.
Hong Kong’s Hang Seng sank 1.9pc to 16,187.00, led by technology shares, which dropped 2.4pc. The Shanghai Composite index slipped 1.2pc to 2,894.58.
China announced sanctions Sunday against five American defense-related companies in response to US arms sales to Taiwan and US sanctions on Chinese companies and individuals. The announcement was made less than a week ahead of a presidential election in Taiwan that is centred around the self-ruled island’s relationship with China, which claims it as its own territory.
In South Korea, the Kospi shed 0.2pc, to 2,572.41, and Australia’s S&P/ASX 200 lost 0.5pc to 7,453.40.
Taiwan’s Taiex gained 0.5pc, while the SET in Bangkok was 0.5pc lower.