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Russian president Vladimir Putin has said that Moscow should consider limiting exports of uranium in retaliation for Western sanctions.
In televised comments addressed to Russian government ministers, Mr Putin said such restrictions could also be introduced for other commodities, and noted that Russia was a major producer of natural gas, diamonds and gold.
“Please take a look at some of the types of goods that we supply to the world market … Maybe we should think about certain restrictions – uranium, titanium, nickel,” he urged Russian prime minister Mikhail Mishustin.
Uranium, a naturally occuring metallic element, is extracted from ore and used to power nuclear reactors.
Mr Putin’s remarks drove shares in uranium mining firms upwards on the expectation of higher prices for the commodity.
In 2023 the US and China topped the list of Russian uranium importers, followed by South Korea, France, Kazakhstan and Germany. Russia is the world’s largest exporter of nuclear fuel and technology.
Since the start of the war in Ukraine, Western governments have been attempting to limit their reliance on Russian exports.
In May, US president Joe Biden signed into law a ban on enriched uranium imports from Russia, a trade worth around $1bn (£767bn) annually. However, it contained waivers in case of supply concerns that would allow the US Department of Energy to maintain normal levels of Russian uranium imports through to 2027.
Russia accounted for 27pc of the enriched uranium supplied to US commercial nuclear reactors last year.
“It will be really hard to replace, especially in the short term, the next 2-3 years,” said Citi analyst Arkady Gevorkyan.
“Western enrichers are only making plans to build additional enrichment capacity, which would require at least three years to be completed. We anticipate that utilities in the US might be able to partially replace it by importing low enriched uranium from China.”
In January last year, the UK government launched a Nuclear Fuel Fund to bolster domestic nuclear fuel production. At the time, it said that Russia owned around 20pc of global uranium conversion capacity and 40pc of enrichment capacity.
Tom Greatrex, chief executive of the Nuclear Industry Association, told The Telegraph that the UK does not use any Russian uranium and that the industry has more than 12 months’ supply in storage.
EDF, which operates eight British nuclear power stations, is understood not to use Russian uranium in the UK. Last year, it told a Commons select committee: “We are determined to eliminate Russian material completely from the UK fuel cycle”.
Any limits by Russia could prove lucrative for hedge funds, which have stockpiled barrels of raw uranium, and would benefit from higher global prices.
EDF has been contacted for comment.
Read the latest updates below.
Goldman Sachs chief David Solomon said that there is still a change that the Fed could go for a bigger than expected rate cut next week because of weakness in the jobs market.
Bloomberg reported that he said:
There’s a case to be made for [a half a percentage point cut] based on more softening in the labour market. I think the percentage chance is in the low 30s.
He reportedly added that his best guess is that the Fed would make a quarter point cut, however.
Thanks for joining us today. We will be back in the morning to cover all the latest from the markets from around 7am.
Wall Street stocks are rebounding this evening after big drops earlier in the afternoon.
The Nasdaq is up 1.2pc and the S&P 500 is up 0.3pc. The Dow Jones is down 0.2pc.
Stocks dropped earlier as traders scaled back expectations for how much relief the Federal Reserve will deliver next week when it begins cutting interest rates.
A possible half a percentage point cut now seems less likely.
Data showed that the US consumer price index gained 0.2pc last month, matching the advance in July. In the 12 months through to August, the index advanced 2.5pc, the smallest year-on-year rise since February 2021 and down from a 2.9pc increase in July.
A top US regulator appointed by President Joe Biden said she wants to see more competition to SpaceX’s internet satellite constellation Starlink.
Elon Musk’s Starlink controls nearly two thirds of all active satellites and has launched about 7,000 satellites since 2018.
Jessica Rosenworcel, chairman of the Federal Communications Commission, said that Starlink has “almost two-thirds of the satellites that are in space right now and has a very high portion of internet traffic … Our economy doesn’t benefit from monopolies. So we’ve got to invite many more space actors in, many more companies that can develop constellations and innovations in space.”
Musk tweeted earlier this month that Starlink, the only high-bandwidth internet system covering the entire planet, “will probably deliver over 90pc of all space-based Internet traffic next year.”
Ms Rosenworcel said “every communications market that has competition is strong, we see lower prices and more innovation, and honestly, space should be no exception.”
Starlink has been approached for comment.
The FTSE 100 had a mixed day on Wednesday, finishing slightly down after news of flatlining economic growth in the UK and softening US inflation.
The session came after the Office for National Statistics said gross domestic product (GDP) recorded no growth in July.
However, analysts were broadly aligned in saying it would not prompt the Bank of England into a surprise second consecutive rate cut later this month.
Rob Wood, chief UK economist at consultancy Pantheon Macroeconomics, said:
There is not enough in today’s GDP release to force the MPC [Bank of England monetary policy committee] to rush to another cut next week; we still expect rate setters to wait until November to cut Bank Rate again.
Later, the US registered a further slowdown in price growth for August, with inflation falling to its lowest level since February 2021 as the Federal Reserve gears up for its own rate cut.
Danni Hewson, AJ Bell head of financial analysis, said:
After a couple of months of nervousness about the state of the US economy and questions about whether a bigger cut might be required to stir the pot, the cooler than expected CPI print [inflation reading] seems to have sealed the deal.
European shares ended flat this afternoon as gains in technology shares were offset by losses in real estate shares.
It came as investors shifted their focus to the European Central Bank for an interest rate decision tomorrow.
The pan-European Stoxx 600 index, which includes some of Britain’s biggest companies, was little changed on the day.
German shares outperformed European peers as Commerzbank surged 16pc, after Italy’s UniCredit bought a 9pc stake in the German lender.
Semiconductor industry supplier ASML Holding’s 3.8pc gain caused the technology sector to rise but the real estate sector kept the gains in check, falling 0.8pc.
Investors will now shift their focus to the ECB that meets tomorrow and is expected to cut interest rates by a quarter percentage point.
Joe McConnell, European liquidity strategies portfolio manager at JP Morgan Asset Management, said:
Anything other than a [quarter point] rate cut from the ECB tomorrow would be a huge surprise to us and the market.
The real intrigue will be in [bank president Christine] Lagarde’s comments about the perceived persistence of inflation and the pace of future rate cuts.
Nvidia boss Jensen Huang said that a shortage of its latest AI chips is frustrating some customers, Bloomberg has reported.
He told a Goldman Sachs tech conference in San Francisco:
The demand on it is so great, and everyone wants to be first and everyone wants to be most.
We probably have more emotional customers today. Deservedly so. It’s tense. We’re trying to do the best we can.
Bloomberg reported that Mr Huang said that Nvidia is facing strong demand for its latest generation of chips, called Blackwell.
Russian president Vladimir Putin said today that Moscow should consider limiting exports of uranium, titanium and nickel in retaliation for Western sanctions.
Mr Putin’s remarks prompted a rise in nickel prices and drove shares in uranium mining firms higher.
In televised comments to government ministers, he said such restrictions could also be introduced for other commodities, and noted that Russia was a major producer of natural gas, diamonds and gold.
But he said that measures did not need to be taken “tomorrow”, and must not cause damage to Russia itself.
The three-month contract for nickel rose 2.5pc to an intraday high of $16,110 per metric ton on the London Metal Exchange (LME) after Putin’s remarks.
China is the top nickel buyer from Russia, importing 38,026 tons last year, which accounted for 38pc of Russia’s nickel exports, according to Trade Data Monitor.
Almost 30pc of Russian nickel exports, or 29,172 tons, went to the Netherlands last year for shipment to other European countries.
Shares in uranium miners jumped following the news, with NexGen Energy, Cameco and Denison Mines all up more than 4pc.
The FTSE 100 closed down by 0.2pc.
The top riser was gambling giant Entain, up 4.1pc, followed by Intermediate Captial Group, up 2.3pc.
At the other end of the index, Rentokil Initial plunged 20.1pc , while Howden Joinery fell 1.8pc.
Meanwhile, the mid-cap FTSE 250 dropped 0.6pc.
Top riser was Trustpilot, up 11.9pc, followed by WH Smith, up 10.8pc.
Ocado was the biggest faller, down by 4pc, followed by engineering group Goodwin, down a similar amount.
Rescue deals have been struck to save 23 former CTD Tiles stores after the supplier went bust last month.
CTD Tiles tumbled into administration in August after coming under pressure from a downturn in the home improvement sector.
It ran 86 stores across the UK and employed 425 staff before its collapse.
Administrators swiftly struck a deal for rival Topps Tiles to buy 30 stores, CTD’s brands, intellectual property, stock and two distribution sites for £9 million.
However, 56 stores were shut and 268 jobs at the business were lost.
On Wednesday, the administrators at Interpath Advisory confirmed they have secured two further deals which will allow 23 former CTD stores to reopen.
Stiled Limited, which owns the Tile Giant and Tile Choice brands and operates 49 stores across the UK, is to take on 16 former CTD Tiles stores and associated stock.
Separately, Kajaria-UKP Limited, a UK joint venture with New Delhi-based tile manufacturer Kajaria Ceramics, agreed to save seven stores and take on associated stock.
Canary Wharf has suffered a further debt downgrade following an exodus of office workers in the wake of the pandemic. Lucy Burton reports:
Fitch Ratings has downgraded Canary Wharf Group deeper into junk status to reflect “cash flow constraints” and the looming refinancing of a £350m bond.
Fitch and Moody’s, another credit ratings service, which has itself unveiled plans to leave Canary Wharf, both cut their ratings for the group last year as the value of its office portfolio slumped.
The east London financial district, which got its name from the quay where fruit and vegetables from the Canary Islands were once offloaded, has struggled to attract workers since Covid-19 fuelled an increase in remote working.
Read the full story…
Spanish prime minister Pedro Sanchez said today taht the European Union should reconsider proposed import tariffs on Chinese-made electric vehicles. He urged Brussels and Beijing to find a compromise that avoids a trade war.
Mr Sanchez’s comments during a visit to China suggest a change of tack from Spain. Until now, it has supported the tariffs, while signalling concern about the impact any potential fallout from the EU-China trade spat could have on Spanish industry.
He said:
I have to be frank, we have to reconsider our position, all of us. Not only the member states but also the [European] Commission.
We don’t need another war, in this case a trade war. I think we need to build bridges between the European Union and China, and from Spain we will be constructive and try to find a compromise between China and the European Commission.
Chinese president Xi Jinping urged Mr Sanchez on Monday to play a “constructive role” in improving strained ties between Beijing and Brussels.
Euro zone government bond yields fell on Wednesday after a moderate rise in US consumer prices, which should allow the Fed cut interest rates next week even though it is likely to dissuade them from an outsized 50 basis point move.
Germany’s 10-year yield, the benchmark for the euro zone, is down at 2.10pc, down from 2.13pc yesterday evening.
Britain’s 10-year gilts are 3.76pc, down from 3.82pc last night.
US benchmark 10-year yields, which had earlier fallen to a 15-month low of 3.61pc, are currently 3.63pc, down from 3.65pc last night.
Lindsay James, investment strategist at Quilter Investors, said:
Given inflation has now steadied at a consistent level, a [US] rate cut next week is now a near certainty.”
The artificial intelligence boost to the S&P 500 has been “overcooked” and is fizzling out, Morgan Stanley’s chief investment officer Mike Wilson has said.
He told Bloomberg Television:
The AI dream – a little bit of that luster has come off. We just got overcooked on the whole AI theme. It doesn’t mean it’s over.
Bloomberg reported that he reiterated his support for investing in so-called defensive stocks, in areas including utilities, consumer staples and health care.
He also reportedly said that in a “soft landing” for the US aeconomy, Donald Trump’s policies are likely good for stocks and bad for bonds. He said:
I do think the stock market is pro-Trump. The stock market has traded better when his odds go up, and vice versa.
Truth Social owner Trump Media & Technology Group dropped 16.3pc this afternoon.
The company behind former President Donald Trump’s social media platform has often risen and fallen with expectations for Mr Trump’s re-election chances, and is coming off a debate with Vice President Kamala Harris.
Since closing above $66 in early March, the stock has tumbled to $15.54. That affects Mr Trump personally because he is the company’s largest shareholder.
Bitcoin and other cryptocurrencies – which Mr Trump has been championing in recent weeks, along with his own crypto company – fell modestly Wednesday. Bitcoin was down roughly 3pc.
Today’s consumer prices index data for the US caused stock markets to tumble. The S&P 500 is currently down 1.6pc, the Dow by 2pc and the Nasdaq by 1.3pc.
Seema Shah, chief global strategist at Principal Asset Management, said:
This isn’t the CPI report the market wanted to see.
Investors have a long history of being overly optimistic about how much and when the Fed will cut interest rates, only to send stock prices lower after being confronted with reality.
Gargi Chaudhuri, chief investment and portfolio strategist, Americas at BlackRock:
We believe the market is pricing in more rate cuts than what will occur this year.
However, the Fed has at least already indicated it’s about to begin lowering interest rates as it shifts its focus from fighting high inflation to protecting the job market and keeping the economy out of a recession.
With inflation down from its peak of 9.1pc two summers ago, the Fed is hoping to ease the brakes off the already slowing economy by making it easier for companies and households to borrow.
Zara owner Inditex, the world’s biggest fashion retailer, posted a record profit for the first half of the year on Wednesday, despite slower sales growth.
The Spanish group said its net profit rose 10pc to €2.8bn euros (£2.4bn) in the first six months of its financial year, which ends July 31.
Oscar Garcia Maceiras, chief executive, said:
The design and quality of our fashion proposition and the experience we offer our customers are, together with the efficiency and increasing sustainability of our operations, the keys to the solidity of these results.
Inditex, which also owns Pull&Bear, Bershka, Massimo Dutti and Stradivarius, said its spring and summer collections were “very well received” by customers.
Sales increased by 7.2pc to €18.1bn, but it was a slower pace than in the first six months of 2023, when they grew by 13.5pc.
Analysts, however, had expected the slowdown after four years of record earnings. The group’s net profit was close to expectations from analysts surveyed by financial data firm FactSet.
Sam North, an analyst at eToro, said:
The luxury fashion sector was better equipped to deal with the cost-of-living crisis, with its customers less sensitive to economic uncertainty in comparison to price-sensitive high street shoppers, and LVMH and Hermès and others really capitalised on this.
However, easing inflation and cost pressures appears to be sparking a revival amongst some of the high street’s biggest names such as Inditex.
US stocks have deepened their losses following inflation data that indicated the Federal Reserve is unlikely to cut interest rates by a heftier half a percentage point next week.
The consumer price index slowed to 2.5pc in August from a year ago, down from 2.9pc in July and the lowest annual figure since February 2021.
However, money markets expect the Fed will cut interest rates by a quarter of a point next week – the first cut in four years – having predicted a 62pc chance of a larger half a point cut a month ago.
Preston Caldwell, US economist at Morningstar, said: “Today’s inflation data should diminish the odds of a 0.5pc Federal funds rate cut this month, but we had already thought that was unlikely. By contrast, it does nothing to diminish the odds of a 0.25pc cut.”
The Dow Jones Industrial Average was down 1.7pc to 40,046.73, while the S&P 500 dropped 1.3pc to 5,423.46.
The tech-heavy Nasdaq Composite is also suffering losses, down 0.7pc to 16,899.69.
My colleague Alex Singleton will take over the live updates now, and will keep you informed into the evening.
The Gym Group has improved its sales and profit guidance as younger people looked for more affordable options to keep fit.
Shares in the company rose 9.6pc after the value gym chain also swung back to profit for the past half-year.
The positive update came just two months after it previously upgraded its performance targets.
It told shareholders that it benefited from a rise in new members, increased visits from existing members and price increases for certain membership packages.
As a result, revenues grew by 12pc to £112.1m for the six months to June 30.
Gym Group boss Will Orr said:
Our typical audience is younger than some of our competitors and they are particularly looking for affordable ways to move towards a healthier lifestyle at the momentum.
With the recent economic backdrop there has been a trend in a lot of areas towards low costs operators, and that plays into our strengths.
The finance chief of struggling shipbuilder Harland & Wolff has resigned with immediate effect, the Belfast-based company has announced.
Arun Raman has stepped down from the board of the yard famed for building the Titanic.
His departure follows the exit of chief executive John Wood, who left at the end of July after the Government declined to provide a £200m loan guarantee to the ailing business.
Restructuring expert Russell Down was named as interim executive chairman,
The company last month had its London-traded shares suspended after it failed to file an audited set of accounts by a deadline last month.
It was also plunged deeper into crisis after the Falkland Islands withdrew from £120m contract talks.
Harland & Wolff played a crucial role in the Second World War, building 140 warships and 123 merchant vessels as well as more than 500 tanks.
Wall Street lacked direction at the opening bell after inflation fell as expected to a three-year low of 2.5pc.
The Dow Jones Industrial Average was down 0.9pc to 40,371.28 and the S&P 500 fell 0.4pc to 5,474.28.
However, the tech-heavy Nasdaq Composite gained 0.1pc to 17,041.06.
Manchester United have posted net losses of £113.2m in their latest accounts, but are understood to believe they are compliant with Premier League financial rules despite a fifth straight year in the red.
The Premier League’s profitability and sustainability rules (PSR) allow a maximum loss of £105m over a three-season period, but within that certain losses are deemed ‘allowable’ such as infrastructure, youth team and women’s team spending.
Everton and Nottingham Forest both incurred points deductions last season after being found in breach of PSR.
Included in United’s newly-reported losses were costs of £47.8m linked to the strategic review embarked upon by the club’s owners, the Glazer family, in November 2022, which ultimately resulted in Sir Jim Ratcliffe acquiring a 27.7pc stake in the club.
The club earned a record £661.8m in revenue and has embarked on a major backroom shake-up in recent months, including bringing in a new chief executive, Omar Berrada, poached from Premier League champions Manchester City.
He said: “As I embark on my new role as chief executive officer of this historic club, we are all extremely focused on working collectively to create a bright future with football success at the heart of it.
“We are working towards greater financial sustainability and making changes to our operations to make them more efficient, to ensure we are directing our resources to enhancing on-pitch performance.”
United finished eighth in the Premier League in the 2023/24 season – their lowest finish since 1990 – but won the FA Cup -with victory over Manchester City in the final at Wembley for a second trophy in two years.
The value of the pound has fallen against the dollar as the latest inflation figures raised bets that the Federal Reserve will opt for a more modest cut to interest rates next week.
Sterling was down 0.1pc to $1.307, having touched $1.31 earlier, after the US consumer prices index fell as expected to its lowest level in three years.
Paul Ashworth, chief North America economist at Capital Economics, said:
Overall, inflation appears to have been successfully tamed but, with housing inflation still refusing to moderate as quickly as hoped, it hasn’t been completely vanquished.
Under those circumstances, we expect the Fed to take a measured approach to cutting interest rates.
Rachel Reeves is under pressure to mount a multi-billion pound raid on the pension pots of wealthy savers by slashing the amount of tax-free cash they can withdraw.
Our economics editor Szu Ping Chan has the details:
The Institute for Fiscal Studies (IFS) has urged the Chancellor to cap the amount that can be taken tax-free from pension pots in a move that could raise £2bn.
Currently, people can take up to 25pc of any pension as a tax-free lump sum when they reach 55, up to a maximum of £286,275.
Reducing the amount to £100,000 would affect about one in five retirees, the IFS said, and raise £2bn in the long run.
Read how the current system works and who benefits.
US stocks extended losses in premarket trading after data showed core inflation rose more than expected in August.
Core inflation, which strips out more volatile food and energy prices, rose 0.3pc between July and August, according to the Labor Department, which was higher than the 0.2pc expected by economists.
Compared to the same month last year, core inflation stood at 3.2pc, in line with forecasts.
Ahead of the opening bell, the S&P 500 was down 0.5pc, Nasdaq 100 futures were down 0.5pc and the Dow Jones Industrial Average had fallen 0.6pc.
The Federal Reserve is unlikely to announce a jumbo rate cut next week, analysts have said, despite inflation falling to a three-year low.
Money markets indicate there is a 10pc chance of a half point reduction in borrowing costs from the Fed, although traders have priced in a quarter-point cut from the 23-year highs of 5.5pc to 5.25pc.
Charles Schwab UK managing director Richard Flynn said:
This month’s inflation figures reiterate the likelihood of a slow cutting cycle – disinflationary pressures are strong enough to help ensure against a price spike, so the Fed can opt for a gentle pace to manage risks to the labour market and avoid a recession.
Some market watchers are hoping for an aggressive 0.5pc rate cut at the next Fed meeting in September, but this could prompt inflation to fall too swiftly, which would likely be consistent with a recession.
More gradual cuts would hedge against this and have historically been favourable for equities too. It has been a long cycle, but in this case, slow and steady should win the race.
Neil Birrell, chief investment officer at Premier Miton Investors, added: “The likelihood of a 0.5pc cut from the Fed next week has taken a big knock with this number, but it won’t be enough to stop the Fed cutting at all.”
US inflation has fallen to its lowest level in three years, cementing expectations for the Federal Reserve to begin cutting interest rates next week.
The consumer prices index dropped from 2.9pc to 2.5pc in August, its slowest rate since February 2021, according to the US Labor Department.
The Government has unveiled a “new and improved” deal to help the transition to a greener way of producing steel at the country’s biggest steel plant, confirming it will contribute £500m to the transition.
Ministers said workers at Tata Steel’s giant site in Port Talbot, south Wales, will get improved redundancy terms and the offer of a skills package.
Around 2,800 jobs will be lost as a result of the shutdown of blast furnaces and switch to using an electric arc system of production.
Business Secretary Jonathan Reynolds admitted the deal “falls short of what would be my ideal”, as he unveiled a new package.
The Labour MP told the Commons: “Since becoming the Secretary of State two months ago, I’ve had to respond to a series of challenges not just with the steel industry, but also in shipping, such as Harland & Wolff, and in other areas where the previous government had simply ceased to make decisions and decided to leave them for us to deal with.
“This was a dereliction of duty and it has left the steel industry in particular in an extremely perilous position.”
Mr Reynolds said the Government’s £500m investment can be clawed back if the company does not retain 5,000 jobs across its UK business after the change.
Gas prices have edged lower as a storm in the US is expected to miss major facilities.
Dutch front-month futures fell 1pc as Hurricane Francine was expected to bypass liquefied natural gas facilities clustered around the Texas-Louisiana border.
Venture Global, operator of the Plaquemines LNG terminal near New Orleans, said it has “robust hurricane response plans in place”.
Gas prices fell by 5pc on Tuesday as a cold snap in Europe failed to meaningfully dent supplies.
US stocks have fallen in premarket trading after the US presidential debate in which Vice President Kamala Harris put Republican Donald Trump on the defensive.
The presidential hopefuls battled over abortion, the economy, immigration and Trump’s legal woes at their combative first debate, leaving investors skittish ahead of US inflation data that could influence the Federal Reserve’s policy moves next week.
Bond yields, which move inversely to prices, fell as Democrat candidate Ms Harris’ robust display fuelled expectations of a decline in interest rates, whereas investors forecast higher spending that would boost rates if the former President wins.
Investors are now looking to the US Labor Department’s consumer price index report, which is expected to show inflation fell from 2.9pc to 2.5pc in August.
In premarket trading, the Dow Jones Industrial Average, S&P 500 and Nasdaq 100 were all down about 0.3pc.
Campbell’s has caused a stir with a rebranding of the company made famous by Andy Warhol.
Our reporter James Warrington has the details:
When asked why he had chosen to paint cans of Campbell’s Soup, Andy Warhol had a straightforward response: “I used to have the same lunch every day, for 20 years, I guess, the same thing over and over again.”
The artist’s series of paintings of tins of tomato soup, created between 1961 and 1962, helped lift Campbell’s from the realm of boring cupboard staple to part of pop culture history.
However, what was once a blessing may now be a curse. Campbell’s executives have decided to ditch the word “soup” from the company name to shake off its association solely with one product.
Read why it is parting with its pop culture past.
The price of gold has risen for a third day ahead of US inflation data which will indicate the scale of interest rate cuts expected to be made by the Federal Reserve next week.
Bullion was up 0.3pc to $2,521 an ounce, close to its record of 2,531.75 set in August.
Analysts said gold was attractive amid uncertainty caused by the US presidential debate and amid an expected drop in US inflation – which could lead to sharp drops in interest rates.
Matthew Jones, precious metals analyst at Solomon Global, said:
Last night’s Trump v Harris was a clash of opposites. The stark divide only deepened existing political uncertainty, a factor that tends to push investors toward safe-haven assets like gold.
When the political landscape feels unpredictable and financial markets experience sudden volatility, people seek stability in something tangible—and gold historically thrives in such moments.
The debate was not just political theatre; it likely increased market anxiety, giving gold another day in the sun.
Boohoo has announced it will close its US warehouse just over a year after launching the site as it battles to cut costs.
The online retailer said it would cease operations at its distribution centre in Pennsylvania as it seeks “sustainable, profitable growth”.
Chief executive John Lyttle had previously described the site as a “complete gamechanger” as it would slash delivery times to shoppers in the US, its largest overseas market.
However, shares were down 2pc today as it said it will instead fulfil US orders from its warehouse in Sheffield.
Katie Cousins, an analyst at Shore Capital, said the short life of its US warehouse highlights “a naivety of the American market, along with a waste of time and resources”.
WH Smith’s pivot towards airport and station shops has boosted the retailer’s full-year revenues, despite weakening performance on the high street.
The London-listed company said like-for-like revenue at its travel shops leapt 7pc in the year ending August 31, helping to drive a 5pc boost in total turnover.
It comes as the retailer said it will also open 37 Toys R Us concessions before Christmas, more than doubling the number of mini-outlets at WH Smith locations.
WH Smith has sought to become a “one-stop-shop” for travel buying in recent years, preferring captive audiences at airports and railway stations to walk-in high street trade.
The newsagent, which has 1,100 outlets across the UK, said its travel division performed strongly over the key spring and summer months, aided by “strong passenger numbers”.
Shares were up 13.7pc as it said it would hand £50m back to shareholders through a share buyback programme, while it also announced an £85m cash return as a result of a recent buyout of its pension scheme.
WH Smith Pension Trust completed a £1bn full scheme buy-in with Standard Life in 2022, insuring the liabilities of just under 12,950 members.
Rachel Reeves has defended her decision to claim £4,400 to heat her second home a day after MPs voted to scrap winter fuel payments for 10 million pensioners.
The Chancellor justified the taxpayer-funded expenses bill as pensioners prepare to lose the payment of up to £300.
More than 50 Labour MPs defied Sir Keir Starmer on Tuesday and refused to vote for his plan.
Rachel Reeves claimed £4,400 of taxpayer cash towards her energy bills. In the past five years alone, she has claimed £3,700, Telegraph analysis reveals.
Asked whether it is fair that taxpayers cover the heating bill on her second home, the Chancellor told GB News: “Well, being a constituency MP means that you have to have a house in London as well as, of course, living in the constituency, and that’s the same for all MPs.
“Those are long standing rules. I am determined to ensure that the poorest pensioners are protected and will still get winter fuel payments, and indeed, to ensure that pension incomes continue to increase with the triple lock.”
Britain has sanctioned 10 ships in Vladimir Putin’s “shadow fleet” of vessels which it says use illicit practices to avoid Western restrictions on Russian oil.
The G7 imposed a $60-a-barrel cap on Russian prices last year and said it would block insurance to any vessel which sold Moscow’s crude at a higher price.
The Government has now announced restrictions on 10 ships thought to be at the heart of the Kremlin’s efforts to dodge the restrictions and fund its war machine.
Foreign Secretary David Lammy said:
Today’s sanctions further undermine Russia’s ability to trade in oil via its shadow fleet.
Alongside our partners, we will continue to send a stark message to Russia that the international community stands with Ukraine and we will not tolerate this illicit fleet.
Shares in pest control giant Rentokil have dived after it downgraded its sales and profit expectations following slower-than-expected activity in the US in recent months.
The world’s largest pest control company also suggested that it would reduce staffing levels after overspending.
Bosses told investors that its sales performance in July and August was lower than anticipated, particularly in its biggest market in North America.
It expects to take a roughly £80 million hit to annual operating profits as a result of slower sales, higher business costs and the impact of foreign currency movements.
Rentokil shares have dropped 18.8pc in early trading.
The business was boosted in June after activist investor Nelson Peltz built a significant stake, making it among the top 10 shareholders in the company.
His investment company, Trian Partners, said it wanted to “discuss ideas and initiatives to improve shareholder value”, indicating that it could steer changes for Rentokil.
Oil prices have edged higher as a hurricane neared the US, risking a slowdown in production.
Brent crude, the international benchmark, was up 1.5pc to more than $70 a barrel as Hurricane Francine gained strength.
The storm is expected to hit Louisiana today after causing some offshore oil platforms in the Gulf of Mexico to be suspend operations, although it will likely miss major natural gas export plants.
Oil prices fell below $70 a barrel for the first time in three years on Tuesday amid concerns about demand from the US and China.
The Government is expected to announce details of a multimillion-pound package to help the transition to a greener way of producing steel at the country’s biggest steel plant.
Tata Steel is planning to change the way it produces steel at its site in Port Talbot in South Wales, with the loss of up to 2,800 jobs.
The company will close the remaining blast furnace at Port Talbot by the end of the month in readiness for switching production with a new electric arc furnace which needs fewer workers.
The Business Secretary, Jonathan Reynolds, is expected to outline today details of a deal to help with the transition.
Housing and planning minister Matthew Pennycook told LBC: “We have to have a green transition in steel production”.
Asked how the Government could find money to help Tata Steel, Mr Pennycook said he understands that the package is from “allocated funding” while “the pressures we’re dealing with in terms of the public finances are unfunded spending commitments”.
He added: “Ensuring there is a green transition in steel in this country is an important part of our industrial strategy and what it will take to get the British economy on a sound footing once again.”
The previous Conservative government had agreed to give Tata Steel £500m towards the £1.3bn electric furnace, which will melt scrap steel.
US government borrowing costs have fallen to their lowest level in two years as traders expect data to show inflation eased to its slowest pace in three years.
The yield on two-year US Treasury bonds – the return the government promises to buyers of its debt – fell five basis points to 3.55pc this morning, which is the lowest since September 2022.
It comes as official data is expected to show later that inflation fell from 2.9pc to 2.5pc in August, which would be its slowest pace since February 2021.
That would cement the case for the Federal Reserve to cut interest rates next week.
UK stocks edged higher as optimism about interest rate cuts lifted copper and gold prices, boosting miners.
The FTSE 100 was up 0.1pc, while the mid-cap FTSE 250 wa down 0.1pc after earlier gains as investors maintained a cautious stance ahead of crucial US inflation figures later today.
Industrial and precious metal miners were both up as much as 2.1pc as a weaker dollar and rate-cut hoped boosted copper and gold prices.
Heavyweight energy shares gained 1.2pc after oil prices climbed amid concerns about Hurricane Francine disrupting output in the US.
In corporate news, Rentokil Initial plunged by as much as 18.2pc after the pest control company announced jobs cuts to address spiralling costs.
Rightmove was up 0.6pc having initially fallen by 2pc after the real estate portal rejected the £5.6bn cash-and-stock takeover proposal from Australia’s REA Group.
Shares of WH SMith jumped as much as 12.5pc to the top of the FTSE 250 after the company reported a higher annual revenue and announced a buyback plan worth £50m.
Homewares chain Dunelm has notched up a rise in annual sales and profits, but cautioned it was yet to see a “meaningful” recovery in consumer spending.
The retailer reported a 6.6pc rise in pre-tax profits to £205.4m for the year to June 29 after sales rose 4.1pc, with a marked pick-up in sales growth to 5pc in the final three months.
But shares fell 1.6pc as Dunelm said it was continuing to see a “challenging consumer environment” and warned “the timing of a sector recovery remains uncertain”.
Nick Wilkinson, chief executive of Dunelm, said:
Whilst we are gradually seeing improvements to economic indicators, we are yet to see a meaningful change in consumer spending habits in our markets.
Against this backdrop, and compared to a strong first quarter last year, we have made a solid start to full-year 2024-25.
In corporate news, Rightmove has rebuffed a takeover proposal from Rupert Murdoch’s REA Group in Australia, valuing the UK online property portal at about £5.6bn.
REA, which is majority-owned by the business magnate’s News Corp, confirmed it had put forward an approach for a cash-and-shares deal, which it said would be worth around 705p a share.
Shares in London-listed Rightmove rose 0.7pc as it said the takeover proposal “fundamentally undervalued” the company.
Rightmove claimed that, based on REA’s closing share price on September 10, the proposal would value each Rightmove share at 698p, or £5.5bn.
The company said: “The board carefully considered the proposal, together with its financial advisers, and concluded that it was wholly opportunistic and fundamentally undervalued Rightmove and its future prospects.”
After the economy stagnated in July, ICAEW economics director Suren Thiru said:
These figures confirm that the UK economy struggled for momentum in the aftermath of the general election as falling manufacturing and construction output caused overall activity to flatline in July.
The UK’s growth trajectory should slow further in the coming months with higher energy bills and expected tax rises likely to trigger renewed restraint in spending and investment, despite a boost from subdued inflation.
Despite these downbeat figures, a September rate cut is not certain given that some rate setters are still sufficiently nervous over lingering price pressures to delay loosening policy again, at least until November.
Airport bosses feel they are pulling their weight for the UK economy, after several set new monthly records for passenger numbers.
Nearly eight million people passed through Heathrow’s terminals last month, while the airport also saw its busiest day, with 269,000 passengers on August 18.
It is on course to serve 30m passengers between June and September, which would be the most for that period in the airport’s history.
The airport said Taylor Swift concerts brought in an additional 40,000 passengers this summer, with fans passing through its terminals for the European leg of her Eras Tour.
Manchester and Stansted airports also had their busiest ever months in August, with 3.4m and 3.1m passengers respectively.
Heathrow chief executive Thomas Woldbye said: “For the past four months we have broken several new records, demonstrating our ability to open a world of opportunity for more people, cargo, business and the UK economy.”
Britain’s stock markets have opened higher after Britain’s flatlining growth cemented bets that the Bank of England will cut interest rates by November.
The FTSE 100 climbed 0.1pc to 8,217.46 while the midcap FTSE 250 rose 0.3pc to 20,709.42.
The Euros football tournament helped boost parts of Britain’s economy during July as England made it the the final.
The ONS said that businesses in retail, the arts, entertainment, and recreation sector “reported higher turnover than in previous years”.
It said: “Licensed premises noted a positive impact specifically from the European Football Championships; however, some restaurants cited this as negative impact on footfall.
“Despite falling on the month, some travel agents also noted an increase in bookings because of the Summer Olympics in Paris.”
Sanjay Raja, UK chief economist at Deutsche Bank Research, said the decline in GDP was therefore “disappointing”, adding:
Growth is normalising from the rapid pace set in H1-24 – this much should be expected.
The pace of the slowdown, however, is a little faster than we anticipated – especially in light of the still stellar survey data we’ve seen over summer.
Money markets indicate there is a slightly greater chance that the Bank of England will cut interest rates next week in response to the stagnation in Britain’s economy.
Traders bet there is a 23pc chance that borrowing costs will be reduced by a quarter of a percentage point next week, up from about 19pc before the ONS data was released.
The pound is flat against the dollar at $1.308, having been up 0.2pc in the wake of the US presidential debate, which dealt a blow to Donald Trump’s protectionist policies, according to early analysis.
The Bank of England cut rates for the first time in four years last month, reducing the Bank Rate from 5.25pc to 5pc.
Rachel Reeves needs to be careful not to paint a too dire picture of the economy and public finances to pave the way for tax rises, analysts have warned after growth flatlined.
Our senior economics reporter Eir Nolsøe has the latest:
The Chancellor has warned of a £22bn black hole in public finances, partially resulting from large public sector pay rises.
Lindsay James, investment strategist at Quilter Investors, said: “Given the mood music emanating from the government and the economic inheritance it has received from the Conservatives, the government needs to be careful not to overcorrect with its narrative around tax rises and the potential this has to put off investment.”
She added: “Tax rises have been flagged ahead of the Autumn Budget, and consumers and businesses may feel rather more cautious heading into the winter months as they await details from the Treasury.”
It comes after Sir Keir Starmer in recent weeks warned things would get worse before they would get better.
He also said the “broadest shoulders” would need to carry the biggest burden, as the Government sets out to repair public finances.
The stagnation in Britain’s economy is unlikely to be the start of a “renewed downturn”, economists have said, although it has made an interest rate cut by the Bank of England next week “a bit more likely”.
Ruth Gregory, deputy chief UK economist at Capital Economics, said:
The economy stagnated in July (consensus and CE 0.2pc), but that doesn’t mean the UK is on the cusp of another recession and we still think the stickiness of inflation will keep the Bank on hold in September.
At least the quarterly rate dipped only slightly from 0.6pc in June to 0.5pc in July.
And other indicators, such as the activity PMIs suggest the economy is still expanding by about 0.4pc quarter on quarter.
So we still think a mild slowdown in GDP growth to more normal rates of 0.3pc quarterly later this year is more likely than a sudden drop back into recession.
For now, we are sticking to our view that the Bank of England will keep interest rates unchanged in September before cutting rates again in November. But today’s data has made an interest rate cut next Thursday a bit more likely.
Chancellor Rachel Reeves highlighted an £8bn investment by Amazon announced overnight as new data showed Britain’s economy stagnated during the Government’s first month in power.
Amazon Web Services (AWS) is to invest the sum over the next five years building, operating and maintaining data centres in the UK, the company has announced.
The technology giant said the growth of cloud computing and artificial intelligence was key to the increasing investment, which the company said could contribute around £14bn to the UK’s GDP and help support around 14,000 jobs each year.
The Chancellor said:
I am under no illusion about the scale of the challenge we face and I will be honest with the British people that change will not happen overnight.
Two quarters of positive economic growth does not make up for fourteen years of stagnation.
That is why we are taking the long-term decisions now to fix the foundations of our economy, including today’s announcement of £8bn of new investment from Amazon Web Services, that will help rebuild Britain and make every part of the country better off.
Construction suffered a 0.4pc contraction in July in a sharp reversal from the 0.5pc growth recorded in June.
The slump comes despite the Government’s manifesto pledge to build 1.5m homes over the next five years.
Britain’s services sector grew its output by 0.1pc during July, following a decrease of 0.1pc in June.
After Britain’s economy stagnated in July, the ONS director of economic statistics Liz McKeown said:
The economy recorded no growth for the second month running, though longer-term strength in the services sector meant there was growth over the last three months as a whole.
July’s monthly services growth was led by computer programmers and health, which recovered from strike action in June.
These gains were partially offset by falls for advertising companies, architects and engineers.
Manufacturing fell, overall, with a particularly poor month for car and machinery firms, while construction also declined.
Britain’s economy flatlined during the first month under the new Labour government, official figures show.
Gross domestic product (GDP) expanded by 0pc in July, according to the Office for National Statistics.
Growth had been expected to hit 0.2pc during the first month of Sir Keir Starmer’s premiership, having fallen to 0pc during June, down from 0.4pc in May.
Statisticians had described the economy as “going gangbusters” during the final months of under Tory leadership, with GDP expanding 0.7pc during the first three months of the year and 0.6pc during the second quarter.
GDP growth was flat in July 2024 but grew 0.5% in the three months to July 2024.In July services grew (+0.1%) but production (-0.8%) and construction (-0.4%) both fell.Read more ➡️ https://t.co/rI5JUOz1LX pic.twitter.com/8KVdtuuBEK
Thanks for joining me. The Office for National Statistics has released its first figures showing the level of growth in Britain’s economy under Sir Keir Starmer’s premiership.
It showed the economy grew by 0pc during July, showing it stagnated after economists had expected it to grow by 0.2pc.
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Asian shares traded mostly lower after the US presidential debate between Vice President Kamala Harris and former President Donald Trump.
The value of the US dollar has increased against peers in the past when expectations for a Trump re-election have strengthened, among other moves that have come to be known as part of the “Trump trade,” due in part to his calling for tariffs.
In currency trading, the dollar fell 0.2pc against the pound, which is worth $1.31. It fell to 141.72 Japanese yen from 142.41 yen, while the euro cost $1.1036, up from $1.1023.
Japan’s benchmark Nikkei 225 lost 0.8pc in morning trading to 35,867.33, while Australia’s S&P/ASX 200 lost 0.3pc to 7,989.90.
South Korea’s Kospi slipped 0.2pc to 2,517.44 after data showed the seasonally adjusted unemployment rate in the nation edged down to 2.4pc in August 2024 from 2.5pc in July, the lowest in a year as the number of unemployed people declined.
Hong Kong’s Hang Seng dipped 1.5pc to 16,984.02, while the Shanghai Composite slipped 0.8pc to 2,719.73.
Wall Street’s benchmark S&P 500 index closed up yesterday but concerns about slowing economic growth stunted gains and the Dow dipped as bank stocks sank after warnings of current-quarter weakness.
The S&P 500 gained 0.4pc, closing at 5,495.52. The Dow Jones Industrial Average of 30 leading US companies fell 0.2pc, to 40,736.96, and the Nasdaq Composite gained 0.8pc, closing at 17,025.88.
In the bond market, the yield on benchmark 10-year US Treasury notes fell to 3.64pc from 3.70pc late on Monday.