What to watch: Heathrow expansion, Sotheby's sold, and pound at five-month low
Here are the top business, market, and economic stories you should be watching today in the UK, Europe, and abroad:
Masterplan for Heathrow third runway
Heathrow Airport unveiled its latest masterplan for a controversial third runway on Tuesday.
Airport chiefs plan to build the new runway by 2026, but expect expansion to be fully completed by 2050, according to the BBC.
The proposals reportedly include rerouting the M25 motorway through a tunnel underneath the new runway at Britain’s busiest airport.
The public now has a chance to have a say on the plans, which are open to consultation until 13 September
An environmental protest scheduled for Tuesday that could have shut down the airport was called off last week, amid divisions among protesters over the use of drones.
The climate group Extinction Rebellion, which gained widespread attention with a series of protests and road blocks earlier this year in London, postponed the protest to later this year.
Pound hits five-month low on Johnson fears
The pound remained at a five-month low in early trading on Tuesday morning, as Boris Johnson’s victory in the Conservative leadership looked increasingly likely.
Sterling tanked on Monday as Matt Hancock, a rival candidate who had dropped out of the race, backed Johnson’s bid to be the next UK prime minister.
Investors are alarmed at Johnson’s rhetoric on a no-deal Brexit, fearing he could take Britain out of the EU without agreement.
"Sterling is increasingly reflecting the no-deal risk,” according to Neil Wilson, chief market analyst at Markets.com. "The EU says it won’t renegotiate (it may have to), MPs won’t accept the existing deal, and Parliament has limited scope to stop this train.”
READ MORE: A no-deal Brexit means more bureaucracy for manufacturers
The second round of voting in the Conservative party leadership contest gets underway on Tuesday. Results are expected at around 5pm local time. Candidates need at least 33 votes to progress to the next round.
Johnson is expected to retain his commanding lead, after winning the backing of 114 of the Conservatives’ 313 MPs in the first round.
The pound was down 0.1% against the dollar to $1.25 (GBPUSD=X) at 8.40am and down 0.1% against the euro to €1.12 (GBPEUR=X).
French billionaire buys Sotheby’s
The French billionaire Patrick Drahi sealed a deal to buy Sotheby’s, one of world's largest brokers of fine and decorative art, jewellery, real estate, and collectibles.
The $3.7bn (£2.9bn) deal means Sotheby’s (BID) will return to private ownership after three decades on the stock market in New York.
Sotheby’s has faced cost-cutting and pressure from hedge fund investors Dan Loeb and Mick McGuire since the financial crisis.
Drahi is one of the richest people in the world, worth over $9bn, according to Forbes.
Long-haul East Asia flights boost Gatwick
Heathrow’s expansion plans come on the same day Gatwick Airport announced a rise in passenger numbers to 46.4 million.
Britain’s second largest airport also reported a 14.3% rise in long-haul passenger numbers, driven largely by increased flights to East Asia.
The airport, bought recently by French transport and construction firm Vinci, recorded a 7.3% rise in annual underlying earnings to £441.4m.
Overall annual revenues were up 6.1% to £810.8m.
Markets mixed in major week for central banks
European markets were mixed on Tuesday morning ahead of a significant week for central banks.
The US Federal Reserve begins a two-day meeting later on Tuesday. The central bank is expected to leave borrowing costs unchanged, but may lay the groundwork for a rate cut later in 2019.
"The Federal Open Market Committee meeting is the week's biggest event so there will be a degree of caution prevailing in the markets," said Masahiro Ichikawa, senior strategist at Sumitomo Mitsui DS Asset Management.
"Expectations for a rate cut in July have increased significantly, so the markets could experience disappointment if the Fed does not send strong signals of impending easing."
Britain's FTSE 100 (^FTSE) and France's CAC 40 (^FCHI) opened flat, but Germany's DAX (^GDAXI) was down 0.7%, the Euronext 100 (^N100) was down 0.2%, and the pan-region Euro Stoxx 50 (STOXX50E) was down 0.3%.
Asian markets were mixed overnight, with Japan's Nikkei 225 (^N225) down 0.7%, Hong Kong's Hang Seng index (^HSI) up 1%, and China's benchmark Shanghai Composite (000001.SS) down by 0.7%.
What to expect in the US
US stock futures were pointing to a lower open later Tuesday.
S&P 500 futures (ES=F), Dow Jones Industrial Average futures (YM=F), and Nasdaq futures (NQ=F) were all down by 0.2%.
