BP in line for huge payday from Putin’s energy firm despite pledge to sell stake
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BP is in line for dividends worth hundreds of millions of pounds from Russia’s oil and gas giant Rosneft even after pledging to ditch its stake in the company.
The FTSE 100 oil and gas giant has yet to sell its 19.75pc of Rosneft and so is entitled to its share of Rosneft’s 441bn rouble (£6.4bn) payout for 2021, worth roughly £1.2bn.
Just before Russia’s invasion of Ukraine, BP was paid a dividend of $464m (£404m) by Rosneft to cover the first half of 2021, but is still entitled to payment for the second half of the year.
It is unclear whether it will ever get the second payment, however, as Russia hits back at sanctions imposed in the West over its war on Ukraine.
Russia initially banned companies from paying dividends to overseas shareholders, and then blocked payments to companies in “unfriendly” countries, including Britain and the US.
Funds are instead put into restricted accounts, with approval from Russia needed to take the money out of the country. BP does not therefore recognise this as dividend income.
Days after Russia’s invasion of Ukraine in February, BP pledged to sell the Rosneft stake it has held since 2013 and has written it down to zero in its accounts. It has limited sale options, however, with Russia preventing sales of certain assets and a limited pool of buyers.
Igor Sechin, Rosneft’s chief executive, said in June that BP remained its largest private shareholder.
Before the invasion, BP’s chief executive Bernard Looney and former chief executive Bob Dudley both held seats on Rosneft’s board.
Both quit the seats as BP announced its plans to sell the stake in February, with Mr Looney telling staff he was “deeply shocked and saddened” by the situation in Ukraine.
BP has booked charges of $25bn on its decision to write down the investment, and no longer includes any share of Rosneft earnings in its accounts. The stake accounted for about half of BP’s oil and gas reserves and a third of its production.
Rosnet confirmed dividend payouts on Thursday as it announced a 13pc rise in profits to 432bn roubles.
Production rose 1.5pc to 4.85 million barrels of oil per day.
Mr Sechin said: "In the interests of our shareholders and in full compliance with the dividend policy, in June 2022 the annual general meeting approved dividends.
"As a result, our shareholders, including BP, received over 441bn roubles as dividends for 2021."
While many traders have been shunning Russian products, oil import bans in the EU and the UK are not set to come into force until 2022. Mr Sechin said the results were “stable” despite “adverse external factors and unlawful sanctions” .
While most Western oil majors have pledged to get out of Russia, Norway’s Equinor is the first to have done so fully, at the start of this month. Sources told Reuters that it had sold its main assets to Rosneft for one euro, while forgoing future liabilities and investment commitments.
BP’s rival Shell is also exiting Russia, recently walking away from its stake in the major Sakhalin 2 liquified natural gas plant after the state took full control of the project.
It says it has also stopped spot purchases of liquified natural gas from Russia, although it still has some long-term contractual agreements.
06:18 PM
Wrapping up
That's all from us today, thank you for following! Before you go, check out the latest stories from our reporters:
British Airways cancels one in seven flights during Queen Elizabeth II's funeral
Scramble to hand back old banknotes as plastic replaces paper
Louis Vuitton owner tells staff to take the stairs and turns down store thermostats
Billionaire founder of Patagonia gives the outdoors brand away
06:17 PM
John Lewis warns over staff bonus and difficult Christmas
John Lewis has slumped to a £99m half-year loss and warned that its staff bonus is at risk as the cost of living crisis batters middle-class consumers. Laura Onita writes:
Dame Sharon White, the chairman of the group that also owns Waitrose, said a successful Christmas is now essential for the fortunes of the company as it battles the biggest wave of price rises in half a century.
She warned that John Lewis will need “a substantial strengthening of performance” in the second half of the year if it is to generate sufficient profit to pay out a bonus for staff, who jointly own the mutual. Employees did not receive a bonus last year for the first time since 1953.
Dame Sharon said: “We haven’t seen inflation of this sort since the shock of the 1970s."
05:57 PM
FTSE 100 closes flat
The FTSE 100 has ended a volatile session flat as gains in banking and consumer stocks offset losses in energy shares.
After two sessions of sharp losses, the blue-chip index paused as banks were lifted by bets of a 70pc chance that the Bank of England would deliver a 75-basis-point interest rate rise next week.
While data on Wednesday showed that inflation surprisingly fell in August, a BoE survey said the British public's expectations for inflation over the coming year rose to a record high last month.
"We have seen some calm come back into the markets and at the moment, investors seem to be taking the view that perhaps the selloff earlier in the week was overdone," said David Jones, chief market strategist at Capital.com.
05:36 PM
TikTok launches spontaneous photo feature similar to BeReal
TikTok, one the world’s most downloaded apps, has unveiled a new feature that prompts people to post daily candid photos or videos of themselves at random moments.
Called TikTok Now, the feature follows the recent success of BeReal, a social media platform that requires people to take a daily picture of themselves within a two-minute time limit.
Founded in 2020, BeReal’s simple design and spontaneity have appealed to young users seeking a fresh alternative to traditional social media.
Say hello to TikTok Now: a new feature for you to connect and create with friends. pic.twitter.com/rYcd599MVB
— TikTokComms (@TikTokComms) September 15, 2022
05:05 PM
Bank of America to offer paid sabbaticals to long-term staff
Bank of America is starting a paid sabbatical programme to reward its long-term employees, starting with four weeks off for those who have spent 15 years with the company.
Beginning next year, the bank will offer time off to let employees “reinvest in their priorities in life,” Bloomberg reported. The move is to recognise tenure at the company at certain career milestones, and to attract and retain talent.
It comes as firms across corporate America and Wall Street are grappling with employee burnout and fighting to retain talent.
04:40 PM
Kanye West ends Yeezy partnership with Gap
Rapper and designer Kanye West says he’s terminating his partnership with ailing apparel retailer Gap, potentially spelling the end of a troubled association that left both sides disappointed.
Lawyers for West, who is known as Ye, sent a letter to Gap on Thursday arguing the company had failed to release apparel and open stores as stipulated in the agreement.
“Gap left Ye no choice but to terminate their collaboration agreement because of Gap’s substantial noncompliance,” said Nicholas Gravante Jr., a partner at Cadwalader Wickersham & Taft.
Ye had “diligently tried to work through” the issues with Gap directly and through his lawyers but got nowhere, Gravante said. The artist will now move forward with opening Yeezy retail stores.
04:17 PM
Wickes boosted by surge in demand for home insulation
Shoppers are racing to buy more insulation for their homes as they attempt to ward off higher energy bills this winter. Hannah Boland reports:
DIY chain Wickes reported a 85pc increase in sales of home insulation products compared to pre-Covid levels, as it said customers were looking for ways to cut back on how much energy they use to heat their homes.
Chief executive David Wood said the company had also seen strong sales of other energy-efficiency products such as LED light bulbs and draft excluders.
He said: "To be honest, I do think the Government should be helping households buying these types of products."
The higher demand comes as households prepare to be hit by further energy price increases at the start of next month. Prime Minister Liz Truss earlier this month laid out plans to freeze energy bills at around £2,500 a year for an average household this winter and next.
04:05 PM
Handing over
That's all from me today – thanks for following! Giulia Bottaro will take things from here.
03:38 PM
Heathrow cancels 15pc of flights on Monday
Heathrow Airport is cancelling 15pc of its flights on Monday due to Queen Elizabeth's funeral.
The move will affect 100 British Airways flights and four Virgin flights, the BBC reports.
My colleague @KatyAustinNews reports that 15% of Heathrow flights will be cancelled on Monday to ensure the skies over London fall quiet and as a mark of respect during the events surrounding HM Queen Elizabeth’s state funeral… affects 100 BA flights and 4 Virgin
— Faisal Islam (@faisalislam) September 15, 2022
03:17 PM
Scramble to hand back old banknotes as plastic replaces paper
Consumers are scrambling to replace their paper banknotes with new plastic cash before their old money loses its status as legal tender at the end of this month.
Tim Wallace reports:
The Bank of England said its head office in Threadneedle Street is facing long queues as holders of ageing £20s and £50s line up to swap the notes before September 30.
Warning of waiting times of more than an hour that mean customers arriving after 2pm may not be served, a spokesman said: “There will be long queues.
“We would ask that you kindly consider the long wait times when travelling to the Bank to undertake an in person exchange."
As an alternative, Threadneedle Street suggests customers send banknotes by post for exchange instead of bringing them into the institution in person.
New plastic £20 notes with a picture of the artist JMW Turner came into circulation in February 2020, while polymer £50s have been available since June last year.
The highest-value notes feature an image of Alan Turing, the scientist famed for his code breaking work at Bletchley Park in the Second World War.
02:53 PM
Rees-Mogg puts energy security bill on hold
Business Secretary Jacob Rees-Mogg is said to have put the Government's energy security bill on hold.
Mr Rees-Mogg has told officials that the existing bill – currently under scrutiny in the House of Lords – will be paused or even ditched to reflect new priorities, the Financial Times reports.
Instead, new legislation will be drawn up to incorporate the energy support scheme for businesses.
The energy support bill set out several reforms, including renationalising responsibility for balancing the UK's power networks – a function currently carried out by National Grid.
Officials told the newspaper that the bill could be taken on by the Treasury or the Levelling Up department.
02:37 PM
Wall Street opens lower as rate worries linger
Wall Street's main indices have opened lower after a slew of economic data pointed to resilience of the US economy, likely keeping the Federal Reserve on track for aggressive interest rate hikes to tame inflation.
The S&P 500 fell 0.3pc, while the Dow Jones as flat. The tech-heavy Nasdaq shed 0.7pc.
02:23 PM
Adobe buys app maker Figma for $20bn
Software giant Adobe has agreed to buy rival Figma in the largest ever takeover of a private software company.
The $20bn (£17.4bn) deal, which is a mix of half cash and half stock, is second only to the takeover of WhatsApp, though it could even eclipse that depending on share moves.
Adobe fell about 9pc in pre-market trading.
Figma, which allows customers to collaborate on software as they build it, enjoyed a boom in demand during the pandemic while more people worked remotely.
The company expanded its customer base in recent years from software designers at big companies like Airbnb and Google to also include individuals building lightweight games, maps and presentations. It has also attracted a loyal student following.
THREAD: This morning we’re announcing that @Figma has entered into an agreement to be acquired by @Adobe !
More information here: https://t.co/eqJsSlkShq (1/9)— Dylan Field (@zoink) September 15, 2022
02:05 PM
We never supported banker bonus cap, says BoE
The Bank of England has insisted it never supported a cap on bankers' bonuses and said there are more effective ways to ensure banks account properly for risks.
The comments came after reports that Chancellor Kwasi Kwarteng is seeking to scrap the limit on bonuses in order to boost Britain's competitiveness.
A spokesman for the Bank said: "The Senior Managers Regime, the remuneration rules on deferral, clawback and malus are more effective tools for ensuring bankers take proper account of risks.”
Read more on this story: Kwarteng seeks to scrap bankers’ bonus cap
01:52 PM
US retail sales rise despite squeeze on budgets
Americans picked up their spending a bit in August even as surging inflation on household goods, rent and food took a toll on household budgets.
Retail sales rose an unexpected 0.3pc last month after falling 0.4pc in July, the Commerce Department said. Stripping out business at petrol stations, sales rose 0.8pc.
Sales at grocery stores rose 0.5pc, helped by rising prices in food. Business at restaurants rose 1.1pc, while online sales fell 0.7pc. Business at clothing stores rose 0.4pc while sales at furniture stores fell 1.3pc.
🇺🇸Cautious consumers in August
🟡#Retail sales +0.3%
⚠️Adj. for inflation +0.2%
🟡Core 0.0%
⚠️Adj. for inflation -0.6%
🚨Revisions⬇️
Autos +2.8%
Build mat +1.1%
Rest/bars +1.1%
Sports +0.5%
Merch +0.5%
Cloth +0.4%
Food +0.5%
Elec -0.1%
Online -0.7%
Furn -1.3%
Gas -4.2% pic.twitter.com/240Itj1Q13— Gregory Daco (@GregDaco) September 15, 2022
01:47 PM
AstraZeneca’s Covid jab maker suffers sales plunge
Sales are down by a fifth at the maker of AstraZeneca's Covid-19 vaccine, as the jab gets passed aside for other vaccines in national booster rollouts.
Hannah Boland has more:
Oxford Biomedica said its revenues had fallen 21pc in the first half of the year to £64m, which was "largely driven by a reduction in Covid-19 vaccine manufacturing revenues".
The company said volumes of jab production were down, given last year it saw "exceptional results when vaccine manufacturing was at full pace". It is now expecting to make £30m from Covid vaccine sales for 2022 as a whole, compared to £100m last year.
As a whole across the business, it said revenues in the second half were likely to be similar to those in the first, meaning they would come in at around £130m, compared to £143m last year.
Shares in the company spiked during the pandemic, tripling to £15.60 each, but have since fallen back to below early 2020 levels at £4.50 each.
12:51 PM
Chancellor to present mini Budget next Friday
Chancellor Kwasi Kwarteng will deliver a mini budget next Friday after MPs agreed to delay the start of recess.
Mr Kwarteng will outline policy proposals from Liz Truss's Government on September 23, according to multiple reports.
The Budget is expected to include tax cuts for millions of people, as well as more details about support with energy bills.
12:46 PM
Microsoft's $69bn Activision takeover faces in-depth probe
Microsoft's $69bn (£60bn) takeover of Activision Blizzard will face an in-depth investigation amid concerns it could harm competition.
The Competition and Markets Authority said it will refer the deal to Phase 2 investigation after Microsoft turned down the chance to offer remedies.
The deal with Activision, which owns titles including Call of Duty, will make Microsoft the world's third-largest gaming company.
12:25 PM
Private equity firms circle Vodafone's €13bn towers division
Private equity firms are said to be vying to snap up a stake in Vodafone's €13bn (£11.3bn) mobile towers business.
KKR and Global Infrastructure Partners are among the suits for Vantage Towers, while Swedish investment firm EQT has also been exploring a potential investment, Bloomberg reports.
Vodafone has invited the interested parties to participate in an auction process.
Shares in Frankfurt-listed Vantage Towers have fallen by more than a fifth this year. Vodafone advanced as much as 5pc following the report.
According to the report, Vodafone hasn't made a final decision on the size of the stake it wants to sell. It currently holds around 82pc of Vantage.
12:11 PM
US futures slip ahead of retail sales data
US futures declined as investor sentiment faltered ahead of more economic data that will give hints about the outlook.
Traders remain focused on US data, with a decline in producer prices providing some relief after Tuesday’s surprise inflation beat.
Jobs, manufacturing and retail numbers later today will be parsed for clues on the strength of the economy and inflation expectations.
Futures tracking the S&P 500 fell 0.2pc, while the Dow Jones slipped 0.1pc. The tech-heavy Nasdaq lost 0.4pc.
11:58 AM
Trainline passenger numbers reach 95pc of pre-Covid levels
UK train passenger numbers bounced back to 95pc of pre-pandemic levels in August, according to new figures from Trainline.
The ticket booking app notched up sales of £2.2bn in the first half of the year, up 17pc on 2019.
Trainline said the recovery had been driven by its international business as tourism returned to Europe. But it said business travel remained "subdued".
11:36 AM
Germany considers taking stake in another energy firm
The German Government is considering taking a stake in a second energy supplier to contain a deepening energy crisis.
A rescue package for VNG – the troubled gas importing subsidiary of EnBW – could include a capital injection that would give Berlin a minority stake in the company, Bloomberg reports.
VNG, which supplies gas to around 400 municipal utilities and industrial operators, submitted an application for state aid last week.
It comes as Germany considers nationalising energy giant Uniper, which already needs more funding after burning through much of a €19bn rescue package handed over in July.
11:27 AM
LVMH cuts lights and heating in energy-saving push
The world's biggest luxury goods group will turn down the heating and switch off the lights at night as part of a new energy-saving plan.
LVMH, which owns brands including Luis Vuitton and Moet & Chandon, said it will turn off the lights at stores between 10pm and 7am, while its offices would go dark at 9pm.
It will also lower temperature settings at industrial sites by 1 degree in winter and raise them by 1 degree in summer.
The company, owned by Europe's richest man Bernard Arnault, said the two measures will allow it to cut its energy usage by 10pc.
There's been growing disquiet in France over shops that keep their lights on at night, despite laws that required them to turn them off.
Parkour activists have posted viral videos of them climbing up shop fronts at night to switch off illuminated signs.
11:06 AM
Amazon workers begin first ever UK strike ballot
Amazon workers at a Coventry warehouse will become the first in the UK to take part in a formal strike ballot.
Hundreds of employees will today begin voting on whether to walk out in a row over the company's 3pc pay offer.
The ballot closes on October 19, with any industrial action likely to take place in November, the GMB union said.
Amanda Gearing, GMB Senior Organiser, said:
These Amazon worker will be the first ever in the UK to take part in a formal strike ballot – they're making history.
They’re being offered 35p an hour during the worst cost of living crisis in a generation – and that’s from a company worth more than £1 trillion. Understandably, they are furious.
Amazon can afford to do better. It’s not too late to avoid strike action; get round the table with GMB to improve the pay and conditions of workers.
10:48 AM
Energy bill freeze to hand suppliers up to £1.6bn profit
The taxpayer is to fund profits of up to £1.6bn for energy suppliers this year after their earnings were protected in Liz Truss's freeze on household bills.
Rachel Millard has more:
Businesses will be allowed to make a margin of 1.9pc on energy that they sell to the public through the Prime Minister's subsidy scheme, which caps the average bill at £2,500.
The cost of supplying households is expected to hit more than £80bn over the next year owing to a surge in wholesale prices.
This means that companies will be in line for a £1.6bn profit – even though the Treasury is partly responsible for footing this cost.
Rocketing gas costs over the past year have triggered a cost-of-living crisis, with average household bills climbing 54pc in April to £1,977.
They were set to increase to £3,549 in October after Ofgem, the energy regulator, raised the price cap on energy bills. The cap, introduced in 2019, changes every three months to reflect wholesale costs.
Read Rachel's full story here
10:33 AM
EDF to take €29bn hit from nuclear woes
EDF has said it will take a €29bn (£25bn) hit from troubles at its nuclear reactors – a bigger impact than previously feared.
The French energy firm, which is on the brink of nationalisation by Emmanuel Macron, has taken almost half of its nuclear reactor fleet offline due to maintenance or problems with corrosion.
This has hit electricity production, which EDF now warns will hit the low end of a range between 280-300 terawatt-hours, well short of the 360TWh generated in 2021.
The financial hit is €5bn higher than its previous estimate of €24bn.
While 26 of EDF's 56 reactors are currently offline, executive director Cedric Lewandowski has said that five should restart in September, five more in October and seven in November, with the rest online by February.
But the firm still forecasts nuclear output below 2021 levels in 2023 and 2024.
10:13 AM
Wizz Air to order 75 more jets amid expansion plan
Wizz Air has said it will order 75 more jets from Airbus as it doubles down on its rapid expansion to challenge rival Ryanair.
The budget airline will exercise purchase rights for the A321neo jets granted by the manufacturer last year, it said. Delivery dates are subject to agreement.
Wizz Air has already lifted capacity above pre-Covid levels and boss Jozsef Varadi said the new order puts the airline on track to have 500 aircraft by the end of the decade.
Mr Varadi said: “The combination of Wizz Air’s ultra-low cost operation and the market-leading Airbus A321neo aircraft together create a strong platform for Wizz Air’s future growth.”
10:05 AM
Putin’s gas blackmail risks backfiring disastrously
As Europe battles to keep the lights on this winter, leaders across the Continent have begun framing the energy standoff with Russia as an epic struggle between good and evil, writes Matt Oliver.
“It is about autocracy against democracy,” said Ursula Von Der Leyen, the European Commission’s president, in her annual address on Wednesday.
Her rhetoric, a far cry from past calls for diplomacy, is the latest example of hardening European attitudes amid signs that the tide may finally be turning – both on and off the battlefield in Ukraine.
With Kyiv’s soldiers pushing back the Russian invaders and the European Union comfortably exceeding targets for gas storage, academics and experts say that – although the coming months will be among the hardest in living memory – Vladimir Putin no longer holds the leverage he once did over the Continent’s gas supplies.
09:48 AM
DFS hit by slump in sofa sales
DFS has reported a big slump in profits as it warned the cost-of-living crisis was denting demand for sofas.
The retailer reported a 43pc fall in pre-tax profit to £58.5m in the year to the end of June.
It said order numbers "softened markedly" in the last three months of that period as the cost-of-living crisis weighed on customers.
DFS warned that sales volumes across the industry could slump by 15pc in the current financial year compared to pre-pandemic levels.
That would slash its profit to as little as around £20m, even as the business said that its revenue would continue to grow.
Tim Stacey, chief executive of DFS, said:
This has been the most operationally challenging year that we can remember, with industry-wide Covid-related supply chain issues, double-digit cost inflation on raw materials and ongoing colleague absence and skill shortages.
09:28 AM
Pound holds steady near 35-year low
Sterling was little changed this morning, hovering close to a 35-year low against the dollar touched last week.
The pound has been one of the worst performing major currencies this year as investors fret about inflation and the economic outlook, as well as political uncertainty.
Markets are betting on the Bank of England to raise interest rates by 50 basis points – or even 75bp – when it meets next week.
The pound was down 0.1pc against the dollar at $1.1524, just above last week's 35-year low. Against the euro, it was little changed at 86.49p.
09:14 AM
H&M sales disappoint as it lags behind Zara
H&M's sales fell more than expected over the summer as the retailer fell further behind Zara amid a deepening cost-of-living crisis.
Revenue fell 4pc in the three months to the end of August – the first decline in six quarters and worse than analyst forecasts.
It comes a day after Zara owner Inditex reported a 25pc jump in first-half sales and higher profits than expected after increasing prices.
H&M has said it wants to strengthen its market position by not raising prices as much as competitors.
09:04 AM
Billionaire Patagonia boss gives company away
The billionaire founder of outdoor brand Patagonia has given his company away to charity.
Yvon Chouinard said the new ownership structure will mean any profit not reinvested in running the business will be used to fight climate change.
That will amount to around $100m (£87m) a year, he said.
Patagonia, which specialises in hiking and outdoor clothing, was already donating 1pc of its profits to climate-related charities. But in an open letter, Mr Chouinard said he wanted to do more.
He wrote: "Despite its immensity, the Earth’s resources are not infinite, and it’s clear we’ve exceeded its limits. But it’s also resilient. We can save our planet if we commit to it."
08:48 AM
Hilton Food shares crash on profit warning
Shares in Hilton Food have tumbled by the most on record after the company issues a profit warning.
The food group, which supplies products to supermarkets including Tesco and Waitrose, said customers were cutting back and higher costs had hammered its seafood business.
Shares crashed more than 25pc to the bottom of the mid-cap index.
08:38 AM
FTSE risers and fallers
The FTSE 100 has pushed higher in early trading after two days of sharp losses following higher-than-expected inflation figures.
The blue-chip index gained 0.5pc, boosted by banking and mining stocks.
Banks including Barclays and Lloyds were among the main drivers as traders bet on a big 75 basis-point increase in interest rates next week.
Miners such as Glencore and Rio Tinto were also higher as supply issues sparked by Europe's energy crisis kept prices elevated.
Shell gained 0.4pc after it named gas and renewables head Wael Sawan as its new chief executive.
The domestically-focused FTSE 250 gained 0.6pc. Hilton Food crashed 25pc after it issued a profit warning.
08:13 AM
THG issues profit warning as two directors step down
THG has warned its sales will miss expectations this year as two top directors stepped down in the latest blow for the troubled retailer.
The struggling ecommerce firm, founded by Matthew Moulding, said its profits will fall below 2021 levels to between £100m and £130m while revenue would grow between 10pc and 15pc.
That’s down from previous forecasts of flat earnings and sales growth of between 22pc and 25pc.
THG also announced the departure of two non-executive directors – Zillah Byng-Thorne and Andreas Hansson. Shares slumped more than 9pc as markets opened.
Almost 80pc of THG’s market value has been wiped out this year as investors question the beauty and health-food firm’s business model and corporate governance.
It has also been hit by sharp cost increases, as well as SoftBank’s decision to call off an investment deal that gave it the option to buy a 20pc stake in the group’s Ingenuity business.
08:09 AM
Kwasi Kwarteng seeks to scrap bankers’ bonus cap
Kwasi Kwarteng is considering lifting a cap on bankers’ bonuses in an attempt to make the City more competitive globally.
Giulia Bottaro and Camilla Turner have more:
The Chancellor is understood to believe the initiative would attract top talent to Britain amid a scramble to improve London’s position against other financial centres such as New York, Frankfurt, Hong Kong and Paris.
Former prime minister Boris Johnson never proposed scrapping the cap, which limits bonuses to twice annual salary, to avoid a backlash.
According to the Financial Times, Mr Kwarteng, who has promised a “Big Bang 2.0” in the City driven by post-Brexit rules, told banking executives last week: “We need to be decisive and do things differently.”
People close to Mr Kwarteng believe the key issue is boosting London's desirability as a destination for top bankers over other competing financial centres such as Paris, which is offering 30pc income tax rates to attract investment banking professionals.
It is feared that unless measures are taken to make it a more favourable environment for high net worth financiers, London could lose out to other capital cities.
08:06 AM
FTSE 100 opens higher
The FTSE 100 has opened on the front foot, clawing back some of its losses after yesterday's sell-off.
The blue-chip index rose 0.4pc to 7,308 points.
08:04 AM
Shell picks renewables chief as new boss
Good morning.
Shell has tapped its head of gas and renewables as its new chief executive in a sign of the oil giant's shift towards clean energy.
Wael Sawan, who's served at the company for 25 years, will take over the top job at the beginning of next year.
It came as Shell confirmed the departure of chief executive Ben van Beurden after almost four decades at the FTSE 100 group.
Mr van Beurden, who joined in 1983, steered the company through some of its most turbulent times.
5 things to start your day
1) Putin’s gas blackmail risks backfiring disastrously It will be a painful winter – but Europe is finding a way to survive without Russian fuel
2) Women think prices rise faster than men because they ‘like round numbers’, claims ECB Gap in expectations between the sexes means women are less confident in the economy
3) Threat of cross-Channel power crunch as Britain and France rely on importing each other's energy ‘Close co-operation’ will be required between UK and the continent to keep the lights on
4) Harsh winter risks sparking social unrest in Europe, warns IMF Warning comes as EU hits energy suppliers with €140bn raid on profits
5) Kwarteng seeks to scrap bankers’ bonus cap Chancellor hopes to boost City with wave of reforms
What happened overnight
Asian stocks edged higher at the open on Thursday, tracking gains on Wall Street as markets adjusted following a rout this week on higher-than-expected US inflation data.
Coming up today
Economics: Retail sales (US), jobless claims (US), labour costs (EU)
Corporate: MJ Gleeson, Kier Group (full-year results); Hilton Food Group, IG Group (interims); Trainline (trading statement)
