Second global recession in a decade looms, warns World Bank
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A second global recession in a decade looms warned The World Bank, as it slashed its growth forecasts for almost all advanced economies this year and next.
World Bank President David Malpass said Russia's war in Ukraine, stubbornly high inflation and global interest rate rises threatened to add to the "already devastating" legacy of Covid and resulting global lockdowns.
The institution downgraded its forecasts for global growth to 1.7pc in 2023 and 2.7pc in 2024, from previous projections of 3pc in both years.
Economists warned that the global economy remained "fragile", adding: "higher than expected inflation, abrupt rises in interest rates to contain it, a resurgence of the Covid-19 pandemic, or escalating geopolitical tensions could push the global economy into recession."
This would mark the first time since the Second World War that two global recessions have occurred within the same decade.
The World Bank blamed sharp slowdowns in the US, eurozone and China for the downgrades as it slashed its growth forecasts for nearly all advanced economies and most developing markets.
Growth in advanced economies is projected to slow from 2.5pc in 2022 to 0.5pc in 2023. "Over the past two decades, slowdowns of this scale have foreshadowed a global recession," the World Bank said.
“The crisis facing development is intensifying as the global growth outlook deteriorates,” added Mr Malpass. "Weakness in growth and business investment will compound the already-devastating reversals in education, health, poverty, and infrastructure and the increasing demands from climate change."
The World Bank said that the Chinese economy has been an engine for global growth in the last three decades, expanding nearly 50-fold since 1990 and now accounting for nearly a fifth of world economic output.
But the report has pared back its 2022 growth estimate for China to 2.7pc, its lowest annual growth rate since the 1970s with the exception of 2020 when the Covid pandemic hit. It also warned about indebtedness in the country, and overreliance on a faltering construction industry which accounts for more than a quarter of GDP.
More than 70pc of emerging and developing economies have also had their growth prospects revised downward. Most smaller currencies have weakened against the dollar in the last year, making borrowing capital and importing raw materials more expensive.
The report forecast that investment in emerging and developing economies in the next two years will grow at less than half the rate that prevailed in the previous two decades. By the end of 2024, it predicted that GDP levels in emerging and developing economies will be roughly 6pc below levels forecast before the pandemic.
The World Bank also noted the risk of widespread debt crises in emerging and developing economies, as the strong dollar raised the cost of debt repayments for countries who had borrowed in the currency, such as Ghana, Tunisia and Sri Lanka.
In response to the findings, the World Bank has called for increased investment in emerging and developing markets, and faster debt restructuring.
“Even though the world is now in a very tight spot, there should be no room for defeatism,” said Mr Malpass. “The report makes it clear that there are significant reforms that could be undertaken now to strengthen the rule of law, improve the outlook and build stronger economies.”
Read the latest updates below.
05:06 PM
City PR man to pocket £30m in sale of Tulchan to rival Teneo
City public relations chief Andrew Grant is in line for a windfall of around £35m following the sale of his financial communications firm to its rival.
The takeover of Tulchan by Teneo, which was announced today, values Mr Grant's company at as much as £70m.
The transaction will be a major payday for Mr Grant, who founded London-based Tulchan in 2000 and owns around half the business.
A senior industry source described the price tag as “amazing”, adding that Mr Grant “will be delighted”.
Tulchan, which advises clients including Marks & Spencer, Unilever and Legal & General, is one of a number of key players in London’s lucrative financial communications sector.
Teneo, which describes itself as a “global CEO advisory firm”, competes with the likes of Brunswick, FTI and FGS Global. It also provides management consulting and other advisory services.
The deal is the latest example of consolidation in the sector. Finsbury, the WPP-backed PR group, became FGS Global in 2021 following a string of international mergers, most recently with Sard Verbinnen & Co.
Paul Keary, Teneo's chief executive, said: “Today marks a significant milestone in the continued growth of Teneo. Andrew and the Tulchan team are deeply experienced and highly respected advisors who will help expand the breadth and depth of our M&A and c-suite advisory in London, Singapore and around the world.
"Following this transaction, our team will number over 1,600 professionals providing a wide range of integrated consulting services not found at any other advisory firm.”
04:04 PM
Handing over
That's all from me today. My colleague Rachel Millard will take things from here.
03:39 PM
Shapps on collision course with unions over strike laws
Trade unions and ministers are on course for a fresh clash after Grant Shapps set out new laws requiring minimum levels of service from ambulance staff, firefighters and railway workers during industrial action.
The proposals were condemned as unworkable and illegal by unions, who warned the legislation would "poison industrial relations" and lead to more walkouts.
Business Secretary Mr Shapps said the plans are in line with laws in other European countries and would "protect the lives and the livelihoods of the British people".
Details of the minimum service levels which will need to be maintained during strikes have yet to be set out.
Mr Shapps said the Government will consult on what an "adequate level of coverage" would be in fire, ambulance and rail services.
He said: "The British people need to know that when they have a heart attack, a stroke or a serious injury, that an ambulance will turn up and that if they need hospital care they have access to it."
03:14 PM
Wall Street creeps higher
Wall Street stocks shifted upwards in early trading despite the World Bank forecasting anaemic global growth.
Meanwhile, US Federal Reserve chairman Jerome Powell gave no indication on the direction of interest rates in a much-anticipated speech in Sweden.
The World Bank pointed to the effects of high inflation, rising interest rates and Russia's invasion of Ukraine in sharply trimming its global growth forecast.
The Dow Jones Industrial Average and the S&P 500 were both up 0.2pc to 33,572 and 3,900 respectively.
The tech-rich Nasdaq Composite Index had a stronger start, up 0.6pc to 10,689.
Among individual companies, Coinbase rose 6pc as it announced it was cutting 950 positions, about 20pc of its workforce following the downturn in the cryptocurrency markets.
03:07 PM
FTX collapse 'kind of a success' for regulators
Harvard professor and former IMF chief economist Kenneth Rogoff took aim at the crypto sector as he discussed central bank independence at the Bank Symposium at the Grand Hotel in Stockholm, Sweden.
Once valued at $32bn, crypto exchange FTX collapsed in November after a run on deposits amid a crisis of confidence in the crypto sector. More than a million creditors were left out of pocket.
Its founder and former chief executive Sam Bankman-Fried faces multiple fraud charges in the US, which he denies.
Mr Rogoff said:
FTX was kind of a success for the regulatory community.
It shows that you need some regulatory structure to provide guard rails.
[Central bank independence] has been the most successful policy innovation post World War Two.
02:53 PM
Lord King agrees with Powell's climate change comments
Former Bank of England governor Lord Kind fully agreed with US Federal Reserve chairman Jerome Powell's comments on climate change.
Mr Powell said "we are not, and will not be, a "climate policymaker" as he gave a speech in Stockholm hosted by Sweden's central bank.
Lord King said central banks should focus on one maxim when striving for central bank independence: "Only do what only you can do."
02:45 PM
Virgin Orbit shares plunge as markets open
Sir Richard Branson's Virgin Orbit suffered a 19pc nosedive in its share price after its failed satellite launch on Monday night.
As markets opened in New York, the company's share price tumbled to about $1.50, having traded above $10 a share this time last year.
02:33 PM
US markets edge upwards at opening bell
Wall Street markets creeped higher at the open as Federal Reserve chairman Jerome Powell refrained from giving any clues on the outlook for interest rates in a speech today.
Mr Powell kept investors guessing on rates a day after two central bank officials signalled it is possibly too early to declare victory over inflation.
The Dow Jones Industrial Average rose 0.1pc to 33,546 while the broad-based S&P 500 lifted 0.1pc to 3,892. The tech-heavy Nasdaq Composite was also up 0.1pc to 10,645.
02:31 PM
Russia borrows record $56bn in a month as sanctions batter Putin
Russia's budget deficit widened to a record in December as revenues plunged amid restrictions on oil exports and spending on the invasion of Ukraine grew.
The fiscal gap reached a record 3.9trn roubles ($56bn) last month, according to Bloomberg calculations based on preliminary government data released today.
That brought the full-year shortfall to about 3.3trn roubles, reversing a surplus in the 11 months of the year.
Finance Minister Anton Siluanov later confirmed the full-year figure, which he said amounted to 2.3pc of gross domestic product, in televised comments at a government meeting.
The preliminary data showed spending for the year was up more than a third compared to pre-war forecasts. Government expenditure in Russia is highly seasonal, with big spikes often coming at the end of the year, widening the deficit.
02:08 PM
Federal Reserve not a 'climate policymaker,' says chairman
The Federal Reserve has only a limited role to play in combating climate change, chairman Jerome Powell said today, a stance that puts him at odds with environmental activists who have pushed central banks worldwide to take steps to restrict lending to energy companies.
Mr Powell said "we are not, and will not be, a 'climate policymaker,'" in prepared remarks to be delivered during a panel discussion in Stockholm hosted by Sweden's central bank this afternoon
He said: "Without explicit congressional legislation, it would be inappropriate for us to use our monetary policy or supervisory tools to promote a greener economy or to achieve other climate-based goals.
In his written remarks, Powell stuck to the topic of central bank independence, the subject of the panel, and did not comment on the Fed's interest rate policies.
01:41 PM
Pound falls amid inflation concerns
The pound has lost 0.5pc against the dollar after the Bank of England's chief economist warned that inflation could prove persistent, even as domestic energy prices retreat.
Huw Pill said early retirement and long-term sickness means Britain faces a prolonged period of inflation.
Meanwhile, a series of surveys today showed British consumer spending rose in December - seemingly defying the cost-of-living crisis - but lagged inflation.
The pound was down to just over $1.21.
Sterling has recovered almost 20pc in value since hitting a record low of $1.03 against the dollar in late September. But it remains 10pc below where it was this time last year.
01:02 PM
London stock markets see £15bn fall off in new company listings
London stock markets experienced a drop-off in activity last year as the total value of new listings shrank by £15bn compared to 2021, new analysis has revealed.
Just £1.6bn was raised in total from companies going public in 2022, down from the record-breaking £16.3bn raised in 2021, according to accountancy giant EY.
This amounts to a decline of 90pc year-on-year.
It was a "very difficult year" for the UK's IPO market, EY said, with tougher economic conditions leading activity to nearly grind to a halt toward the end of year.
An IPO refers to an initial public offering, which means that a company goes public by listing its shares on a stock exchange.
12:29 PM
Crypto exchange becomes first to float in UK
While Coinbase is cutting jobs, Britain has its first listed crypto exchange after a float raising £3.1m.
Tap Global hopes to use the listing as a platform to significantly grow its 100,000 userbase and expand internationally.
The company, which has a crypto app regulated by the Gibraltar Financial Services Commission, has listed on the Aquis Stock Exchange in London.
It was the first crypto fintech company approved by Mastercard in Europe.
Chief executive David Carr acknowledged that the decision to float now in the wake of the collapse of FTX had "raised some eyebrows" but insisted the market "will mature, leaving fully regulated and responsible firms, such as Tap, well-positioned to succeed".
12:12 PM
Wall Street traders await Fed chairman's speech
The direction is unclear for Wall Street when markets open later as investors refrained from placing large bets ahead of commentary from Federal Reserve chairman Jerome Powell.
Mr Powell could provide clarity on the outlook for interest rates when he speaks at a panel discussion at 2pm UK time.
US stock index futures were subdued after two Fed policymakers said the upcoming inflation data will help them decide if they could slow the pace of interest rate increases to a quarter-point rise at an upcoming meeting in February.
Dow Jones Industrial Average contracts down 0.3pc, S&P 500 futures were down 0.1pc, and Nasdaq 100 contracts looked flat.
11:55 AM
Coinbase to axe 950 staff
Coinbase, one of the world's largest cryptocurrency exchanges, has announced it will cut about 950 jobs as the crisis in the digital asset sector continues.
The company said it will spend between $149m and $163m (£122m and £134m) on restructuring, which it says will be "substantially complete" by the end of the second quarter this year.
The job losses are a "response to the ongoing market conditions impacting the cryptoeconomy, as well as ongoing business prioritisation efforts", it said in a statement.
The cuts come a month after the US-listed exchange reached a $100m (£82m) settlement with New York regulators for anti-money laundering failures.
In June last year it laid off around 18pc of staff - roughly 1,100 people.
Coinbase's shares rose 2.8pc in pre-market trading.
11:38 AM
UK crypto launch will not be rushed, says minister
Getting the design of a digital pound right is a bigger priority than having a rapid launch, Britain's financial services minister Andrew Griffith has said.
"We have got to get it right," Mr Griffith told parliament's Treasury Select Committee, adding that being right was more important than being first given the UK's "strong financial reputation".
"It will be a long lead-time activity," Mr Griffith said.
A public consultation on the attributes of a digital pound would be launched in coming weeks, though without a final decision on whether to push ahead with one.
11:19 AM
Oil prices edge higher
Oil prices have swung between gains and losses as traders take stock of the outlooks for US monetary policy and Chinese consumption.
Brent crude, the international benchmark, is up 0.5pc to just above $80 a barrel.
US-produced West Texas Intermediate was up 0.7pc to more than $75 a barrel.
Two Federal Reserve officials said the central bank will likely need to raise interest rates above 5pc before pausing and holding to combat inflation. The comments also weighed on Asian stocks and other commodities.
Oil rallied on Monday after Beijing provided refiners and traders with a generous import quota in its second allocation for 2023.
Asia's biggest economy is gearing up for growth after dismantling its strict Covid restrictions late last year.
11:00 AM
Champagne shortage fears drive sales of English sparkling wine up 20pc
Sales of English wine have helped wine retailer Majestic achieve its "highest-ever market share" over the festive period amid warnings of Champagne shortages.
Senior business reporter Daniel Woolfson has the details:
The high street wine merchant said sales of English fizz grew 19pc over the eight weeks to Boxing Day.
It comes after the boss of Champagne giant Moët Hennessy, which owns brands such as Veuve Clicquot, Dom Pérignon and Moët & Chandon, warned the business was "running out of stock" at a press conference in Singapore in November.
Sales of Spanish alternative sparkling Cava grew at Majestic too, by 29pc over the eight week period.
John Colley, chief executive at Majestic, said: "We are under no illusions as to how tough the next 12 months will be, but I am more confident than ever that we have the right strategy and backing in place to emerge from the cost-of-living crisis as an even stronger business."
Majestic was formerly owned by Naked Wines, but was sold to American private equity firm Fortress Investment Group in 2019, taking the company into private ownership.
Since then it has opened 12 new stores, and plans to open a further five in 2023.
10:44 AM
Online retailers suffer toughest year ever as shoppers cut costs
Online retailers suffered their toughest year ever in 2022 as shoppers tightened their belts in the face of soaring prices.
Economics editor Szu Ping Chan has the details:
UK online sales fell 10.5pc in 2022 compared with the previous year, according to business group IMRG.
This is the biggest drop since records began at the start of the millennium and also the first time sales have fallen on an annual basis since 2000.
Andy Mulcahy, a director at IMRG, said double-digit price rises meant cautious consumers had shunned purchases of non-essential items. While the average checkout value among the 200 retailers tracked by IMRG rose 10pc to £134 in 2022, the number of people buying items fell by up to a fifth last year.
Millions of families are grappling with soaring energy bills and housing costs, with the Bank of England and Office for Budget Responsibility both predicting the UK will remain in recession this year.
The BRC/KPMG retail sales monitor reported a 6.9pc increase in total sales in December compared with a year ago.
However, Paul Martin at KPMG said the rise in sales values masked a "significant" drop in volumes, with December marking the ninth consecutive month of falling volumes.
10:27 AM
Warehouse closures in addition to Amazon's 18,000 job cuts
Amazon's decision to close three warehouses in Britain puts 1,200 jobs at risk - and is in addition to the 18,000 job cuts confirmed by chief executive Andy Jassy last week.
The US online retail giant said it would also open two additional fulfilment centres in the UK, meaning it will be net creating 2,500 jobs in Britain.
However, staff at its fulfillment centres in Hemel, Doncaster and Gourock Scotland, which are earmarked for closure, will have to relocate to the new sites in Peddimore, West Midlands, and Stockton-on-Tees, County Durham, if they want to keep their jobs.
Amazon is seeking to rein in costs that had spiralled during the boom era for online shopping during the pandemic.
Senior technology reporter Matthew Field examines why only the return of Jeff Bezos can reverse the company's decline.
10:09 AM
Amazon closures to make sure warehouse network 'fits our business needs'
Here is a statement from an Amazon spokesman on the plans to close three warehouses in the UK:
We're always evaluating our network to make sure it fits our business needs and to improve the experience for our employees and customers.
As part of that effort, we may close older sites, enhance existing facilities or open new sites, and we've launched a consultation on the proposed closure of three fulfilment centres in 2023.
We also plan to open two new fulfilment centres creating 2,500 new jobs over the next three years.
All employees affected by site closure consultations will be offered the opportunity to transfer to other facilities and we remain committed to our customers, employees and communities across the UK.
09:59 AM
Amazon to shut three UK warehouses
Amazon has said it plans to shut three UK warehouses in a move which will impact 1,200 jobs.
A spokesman for online retail giant Amazon has said the firm has launched consultations over the closure of three UK warehouses.
Sites in Hemel Hempstead, Doncaster and Gourock, in the west of Scotland, have been proposed for closure.
It is understood that all workers at the sites will be offered roles at other Amazon locations.
Amazon has also revealed plans for two new major fulfilment centres in Peddimore, West Midlands, and Stockton-on-Tees, County Durham, which will create 2,500 jobs over the next three years.
09:58 AM
Petrol falls below 150p a litre for the first time since Putin invaded Ukraine
Petrol prices have fallen below 150p a litre for the first time since Vladimir Putin's invasion of Ukraine.
The fuel rose to a record of 191.53p a litre in July as Western sanctions against Russian oil impacted supply chains.
However, average prices at the pump dropped to 149.74p on Monday according to the AA. The last time petrol cost less was on the day of Russia's invasion on February 24.
Diesel now averages 172.21p a litre, having been 153.05p when the Russian invasion began and then setting a record of 199.07p on July 1.
Luke Bosdet, the AA's spokesman on pump prices, said: "A 41.8p-a-litre crash in the average pump price of petrol is a huge relief for drivers, cutting £22.99 from the cost of filling the typical car tank (55 litres).
"However, fuel at 150p a litre is still historically way above the April 2012 record of 142.48p, the previous yardstick of dire pump prices."
Even though fuel costs are falling, motorists are facing an imminent jump in prices at the pump.
Since February 24, the Chancellor has cut fuel duty by 5p a litre, which is in effect a 6p cut when VAT is factored in.
That is on top of the postcode lottery of petrol prices.
Luke Bosdet, the AA's spokesman on pump prices, said:
Road fuel is set for a 6p jump in March when the fuel duty cut (with VAT) comes to an end.
Indicative of the chaos of UK pump pricing and the rampant exploitation of drivers by many fuel retailers, the AA spotted supermarket and non-supermarket retailers yesterday charging less than 140p a litre in South Wales and Northern Ireland.
How fuel stations in areas of big populations and high volume sales can charge well over 10p more for fuel than in largely rural parts of the UK is a question that the Competition and Markets Authority will have to address.
The AA hopes that 2023 will be a year of transformation for fuel prices, where greater pump price transparency mirroring Northern Ireland's Fuel Price Checker will direct motorists to retailers charging fair prices and re-invigorate the level of competition seen before the Covid pandemic.
09:46 AM
Gas prices fall as mild weather lowers demand
European natural gas prices fell as warmer-than-usual temperatures continued to curb demand for heating.
Mild weather has reduced pressure on the continent's gas inventories, with storage levels at roughly the same levels over the past three weeks at a time when countries normally tap their reserves.
Trevor Sikorski, head of natural gas, coal and carbon at Energy Aspects in London said the weather is giving gas markets "breather".
He said: "We will probably end the winter with healthy storage levels, making it less difficult to balance the market for the forward winter season."
Dutch front-month futures gained as much as 3.5pc earlier, before trading 1.8pc lower at €73 a megawatt-hour. The UK equivalent shed 2.5pc to 179.05 pence a therm.
09:32 AM
Disney staff ordered to return to the office four days a week
Staff at Disney have been ordered back to the office four days a week as former chief executive Bob Iger returns to the helm of the entertainment giant.
Matthew Field has the latest:
In a memo to staff, Mr Iger said employees would be expected to be in the company's offices from Monday to Thursday from March 1. Disney joins a raft of major companies in walking back working from home arrangements.
Mr Iger wrote: "Creativity is the heart and soul of who we are and what we do at Disney. And in a creative business like ours nothing can replace the ability to connect, observe and create with peers that comes from being physically together.
"Starting March 1, employees currently working in a hybrid fashion will be asked to spend four days a week on-site, targeting Monday through Thursday as in-person workdays."
Read how the change in Disney's working arrangements comes as a flurry of US companies revert to old working practices.
09:15 AM
Hornby shares plunge after sales warning
Model train maker Hornby has warned that sales are "behind budget" due to pressure on consumer finances amid rocketing living costs.
Shares in the company slumped by 17pc in early trading as the London-listed firm blamed "the challenging consumer economic climate".
It said that the performance over the three months to December 31 will "impact" its full-year performance.
The firm added: "We remain cautious in our outlook for the full year and beyond due to a high level of uncertainty around the impact of several factors on our sales, such as inflation and mortgage costs for consumers, but with employment expected to remain high we are hopeful that the confidence in consumer spending remains."
Hornby highlighted that group sales over the third quarter were ahead of the same period last year.
It added that cumulative group sales for the year so far are up 6pc against the previous financial year.
08:54 AM
Markets fall amid inflation worries
Markets have fallen into the red after warnings from the Bank of England's chief economist that inflation will persist for longer in Britain.
The FTSE 100 was down 0.3pc to 7,705 while the domestically-focused FTSE 250 lost 0.4pc to 19,408.
Drinks maker Diageo and consumer giant Unilever weighed down the UK's blue-chip index.
Huw Pill, the Bank of England's chief economist, warned that Britain's shrinking workforce could keep prices high, which together with the energy crisis and supply chain issues increases the risks of price rises persevering.
Meanwhile, the Government announced plans on Monday to scale back energy subsidies for businesses for the next financial year by about 85pc, after the government described the current level of support as "unsustainably expensive".
08:45 AM
Games Workshop misses sales targets
Games Workshop shares fell 5.2pc as it missed its sales target despite record half-year revenues.
The makers of Warhammer said the 7pc increase in sales to £226.6m "isn't where we wanted to be, particularly in the US" which was flat, at constant currency, against a record year last year.
Pre-tax profits slipped 5.2pc to £83.6m for the six months to November 27 last year.
However the period does not cover the impact of its deal with Amazon to create a Warhammer TV series expected to star former Superman star Henry Cavill.
Although it had no update on the deal, the company said: "We remain confident we will bring the worlds of Warhammer to the screen like you have never seen before."
08:32 AM
Card Factory optimistic despite hit from postal strikes
Retailer Card Factory has upgraded its full-year earnings outlook, despite revealing a hit to its online sales from recent postal strikes.
The group said store sales rose 7.1pc on a like-for-like basis in the 11 months to the end of December as shoppers returned to the high street this festive season.
But it said sales at cardfactory.co.uk slumped 27.6pc year-on-year, impacted by last month's Royal Mail strikes as well as the increase in customers shopping in store, though it stressed trading on the site remains far higher than pre-pandemic levels.
The firm said its strong recent Christmas performance means it is on track for underlying earnings of at least £106m for the full year, against the £96.9m expected in the City.
This will put it on track for pre-tax profits of around £48m, it added.
Shares lifted 6pc in morning trading.
08:25 AM
Cutting business energy support part of 'easing back to normal', says Shapps
The Business Secretary has defended the scaling back of support for businesses with their energy bills, saying a "responsible government has to make those difficult choices".
When it was put to him that companies having to put up prices as a result of the move would not counter inflation, Grant Shapps told LBC Radio:
It's fair to acknowledge that when you do anything, make any of these policy decisions, you're always balancing an array of often quite difficult choices.
In this case, more borrowing and more tax against supporting businesses and what the Chancellor's tried to do is balance both of those things.
What I am saying is a responsible government has to make those difficult choices between do you put up tax, do you run the risk of higher mortgage rates and loan rates for businesses - we saw what happened with that before - or do you kind of ease back to a normal situation where governments don't normally intervene and support energy bills.
08:21 AM
Former Danish PM defends Facebook after Brazil protests
The co-chair of Facebook's oversight board has defended the social network in light of the unrest in Brazil.
Some 1,500 people have been arrested after a far-right mob ran riot inside the presidential palace, Congress and Supreme Court, unleashing chaos on the capital.
Helle Thorning-Schmidt, the former Danish prime minister who is co-chair of Facebook’s oversight board, said the social network had learned from the January 6 storming of the US Capitiol building by Donald Trump supporters in 2021.
She told BBC Radio 4's Today programme:
If I look at Meta, I have to say that Meta doesn’t look like the same social media company in terms of their content moderation as they were two years ago.
One of the things the oversight board did when Meta put the Trump case in front of us was that we gave them the advice that they needed to develop a protocol for exact situations like this.
When questioned about claims by Global Witness, a media monitoring group, that Facebook took its eye off the ball in the runup to the Brazilian election, allowing outright disinformation to be published, she said:
The case might come before the oversight board but it seems like things are very different from two years ago in the Trump decision.
Back then the decision was arbitrary, Meta didn’t have a protocol, they hadn’t allocated specific time and resources to this incident and the risk of things turning violent.
It looks like Meta has, in contrast to other social media companies, done just that.
08:03 AM
Markets digest Bank of England inflation warning
A mixed start for British markets as investors digest comments from the Bank of England's chief economist on inflation.
Huw Pill said during a speech in New York that a surge in early retirement and long-term sickness means Britain faces a prolonged period of inflation compared with the rest of the world.
The internationally-focused FTSE 100 is up 0.3pc to 7,724 while the midcaps on the domestically-focused FTSE 250 have fallen 0.5pc to 19,413.
07:50 AM
Weakening jobs market to hit Robert Walters
Recruiter Robert Walters has warned that profits will just miss expectations amid a worsening jobs market in the UK and worldwide due to mounting economic gloom.
The group said that while group net fee income continued to rise - up 8pc to £105.3m in its fourth quarter on a constant currency basis - growth slowed sharply compared with previous quarters.
It said group net fee income still lifted 20pc over the full year, putting profits on track to hit a record, but that the result would be "slightly below" market expectations.
07:48 AM
Science minister calls Virgin Orbit failure 'gutting'
Looks like science minister George Freeman got out the bunting a little too early after Virgin Orbit's take off:
🚨Historic moment as UK 🇬🇧 wins the Space Race for 1st space satellite launch from Europe with the safe release of the @VirginOrbit #CosmicGirl faring with 9 satellites 🛰 aboard.
One small step for an old 747.
One giant leap for the UK Space Sector. #ScienceSuperpower 🌍 pic.twitter.com/4Ho4AkzjfN— George Freeman MP (@GeorgeFreemanMP) January 9, 2023
His later response: "Gutting."
After a successful launch, rocket fire, release & entry into space, @VirginOrbit reported a problem with orbit trajectory.
Gutting.
Just been to thank the flight & ground crew & Mission Control team🤝
“We do these things not because they are easy but because they are hard.” https://t.co/GrsD9PZ6yo pic.twitter.com/rM7SI5tgMx— George Freeman MP (@GeorgeFreemanMP) January 10, 2023
07:44 AM
Britain undeterred by Virgin Orbit failure, says UK Space Agency boss
The inquest into the failure of the Virgin Orbit mission begins in earnest today as its share price plunges, writes Matthew Field.
UK Space Agency deputy chief executive Ian Annett told BBC Radio 4's Today programme: "We are not quite sure [what went wrong] yet, Virgin will need to do a full review of the data in the next few days or so."
He said there was an "anomaly in the second stage", meaning the rocket reached space but its satellite release failed.
He added: "It shows how difficult getting a satellite into orbit actually is."
The satellites were supposed to be released from the 70ft rocket after it reached space and travel to an orbit 550km above the earth.
However, they have instead likely burned up as they fell back through the atmosphere.
The satellites will all be insured, which should mean the providers are able to recover their costs.
Mr Annett said the failure showed space remains "hard" and "this happens in the space industry". He said the UK sector would be undeterred and more launches were planned in the next 12 months.
07:35 AM
AO World shrugs off sales slump
AO World has said profitability is ahead of its previous expectations after moves to slash costs successfully improved the firm's margins.
The online electricals retailer said it is "cautiously optimistic" despite a 17.2pc drop in sales over the three months to December 31, compared with the same period last year.
It said the sales slump was in line with the board's expectations.
Meanwhile, it said it now expects to deliver adjusted earnings of between £30m and £40m for the current year after improving its guidance.
07:29 AM
Microsoft considers $10bn Investment in ChatGPT creator
Microsoft is in discussions to invest as much as $10bn in OpenAI, the creator of viral artificial intelligence bot ChatGPT.
The proposal under consideration calls for the Washington-based software giant to put the money in over multiple years, though the final terms may change, sources told Bloomberg.
The two companies have been discussing the deal for months, they added.
Semafor earlier reported that the potential investment would involve other venture firms and could value OpenAI at about $29bn.
Documents sent to investors had targeted end-2022 for a deal closing, it added.
ChatGPT has lit up the internet since launching at the end of November, gathering its first million users in less than a week.
Its imitation of human conversation sparked speculation about its potential to supplant professional writers and even threaten Google's core search business.
07:19 AM
Virgin Orbit shares set for $200m fall after rocket failure
Virgin Orbit shares have tanked by about a third after the failure of Britain's first satellite launch.
The company said it was investigating the problem that meant its LauncherOne rocket failed to reach the correct orbit.
Shares slumped by as much as 37pc in the pre-market in New York, wiping up to $240m if it trades that way when markets open later today.
It is presently trading at $1.39, a fall of 30pc and a loss of more than $200m.
Virgin Orbit’s modified 747 plane "Cosmic Girl" took off from Spaceport Cornwall just after 10pm, carrying the company’s LauncherOne rocket underneath its wing.
At an altitude of roughly 35,000 feet, the rocket successfully deployed from Cosmic Girl and ignited its main engine. However, sometime during the flight the vehicle suffered an unknown anomaly, leading to the loss of the mission.
Thousands gathered in Cornwall for what was supposed to be the start of a new era in which the UK can launch satellites.
Science editor Sarah Knapton reported from Cornwall overnight on the failed launch.
It started out so well, but Britain's first satellite launch ended in failure on Monday night when the LauncherOne rocket failed to reach the correct orbit.
Shortly before midnight, Virgin Orbit announced there had been an anomaly which meant the rocket containing nine satellites was heading back down to Earth.
The rocket was expected to burn up on reentry, destroying all the satellites on board.
The evening had started out successfully with LauncherOne taking off strapped to a repurposed Boeing 747 nicknamed 'Cosmic Girl' while Spaceport Cornwall blasted out the Rolling Stones Start Me Up.
Read how within less than two hours, the mission ground to a halt.
07:13 AM
Good morning
It's the morning after the failed satellite launch the night before.
The rocket launched by a Virgin Orbit on its modified 747 aircraft failed to deploy its nine satellites as planned, sending the company's shares plunging.
British astronaut Tim Peake, no less, said the outcome was "so disappointing" but that "getting into space is hard – and valuable lessons will be learned".
Bosses will be hoping those lessons are learning quickly. In pre-market trading, Virgin Orbit shares were down about 30pc.
5 things to start your day
1) Sturgeon and Burnham plot £3bn raid on Westminster to connect HS2 to Scotland | First minister and mayor held secret talks aimed at extending HS2 north of the border
2) Mortgage rates to almost triple for nearly 800,000 homeowners this year | Homeowners to face sharp increase in rates with over a million set to remortgage
3) How cars with picnic tables and champagne coolers helped Rolls-Royce to its best year in history | Sales at the luxury car maker are soaring despite the cost of living crisis
4) Donald Trump’s Scottish golf courses miss deadline to file accounts | Extension comes as former US president battles growing furore over his tax affairs
5) Electric car battery maker Britishvolt in sale talks | Startup has struggled to hit targets and factory site faces multiyear delays
What happened overnight
Asian stocks had fallen after a rally in US shares evaporated amid investor concerns over US Federal Reserve officials' comments about a possible 5pc interest rates rise.
Chinese shares in Hong Kong dropped after a 2pc gain, while Japan’s Topix Index advanced after reopening following a public holiday.
Equities in developing nations entered a bull market amid a rally fueled by optimism over China’s reopening and a weakening dollar.
China's reopening buoyed sentiment with its stocks rising for a sixth consecutive session on Monday, while Hong Kong shares jumped to a six-month high.
China's benchmark has dipped 0.21pc while Hong Kong's Hang Seng index fell 0.85pc.
Copper prices hit their highest in more than six months, driven higher by an improving demand outlook after top consumer China's reopening, while zinc climbed 5pc to its highest since December 15.
Japan's Nikkei rose 0.5pc, bucking the regional trend.
Core consumer prices in Tokyo, released on Tuesday, rose a faster-than-expected 4.0pc in December from a year earlier, underpinning market expectations that the Bank of Japan may phase out its massive stimulus by tweaking its yield curve control policy.
In Australia, shares lost 0.19pc in early trading.
